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CRAGAR Industries Posts 2nd Consecutive Quarter of Positive Earnings

16 August 1999

CRAGAR Industries, Inc. Posts Second Consecutive Quarter of Positive Earnings

    PHOENIX, Aug. 16 -- CRAGAR Industries, Inc.
(OTC Bulletin Board: CRGR) today reported the posting of its second
consecutive quarter of positive earnings.  The Company reported earnings for
the quarters ended March 31, 1999 and June 30, 1999 of $100,457 and $207,410,
respectively.  These results compare to quarterly losses of $350,602 and
$575,920, respectively, for the same three-month periods in 1998.
    "By focusing the Company's strategic plan on replacing lost sales from
Super Shops, our then largest customer that went bankrupt in late 1997, and by
reducing operating costs, the Company has had a bottom line improvement of
over $1.2 million in the first half of 1999," commented Michael L. Hartzmark,
President and CEO of CRAGAR.  "We will continue to focus our attention on
profitable business and on maximizing the strength of the CRAGAR brand name
within the marketplace.  We will continue to streamline our operations, as we
diligently position CRAGAR for the future.  We are looking to establish
strategic alliances and anticipate introducing one or more new products over
the coming months to help maintain the positive momentum of the past six
months."
    The Company attributes this improvement principally to an increase in
sales, the Company's continued efforts to reduce operating costs, and its
commitment to reducing its inventory.  The Company's net sales increased by
over 24% for the six months ended June 30, 1999 over the same six-month period
in 1998.  In addition, the Company was able to reduce it's selling, general
and administrative costs by 38% for the six months ended June 30, 1999 as
compared to the same period in 1998.  The Company reduced its inventory by
over 26% compared to its December 31, 1998 levels.  In addition to reducing
the carrying costs associated with inventory, the inventory reduction improved
the Company's cash flow and allowed it to reduce debt.

    CRAGAR Industries, Inc. is an international designer, producer, and seller
of custom wheels and wheel accessories for cars, trucks, vans, sport utility
vehicles, racing vehicles, and motorcycles.
    For additional information, contact Michael L. Hartzmark, President and
CEO, at 623-247-1300 extension 508.

    This release includes statements, which may constitute forward-looking
statements made pursuant to the safe harbor provisions of the Private
Securities Litigation Reform Act of 1995.  Forward-looking statements are
inherently subject to risks and uncertainties, some of which cannot be
predicted or quantified.  Future events and actual results could differ
materially from those set forth in, contemplated by, or underlying the
forward-looking statements.  Please refer to the Risk Factors in the Company's
filings with the Securities and Exchange Commission, which identify certain
important factors that could cause the actual results to differ materially
from those contained in our forward-looking statements.  These factors
include, but are not limited to, the Company's success in replacing sales lost
as a result of the bankruptcy of the Company's former primary customer, the
Company's ability to continue to reduce its operating costs, the Company's
efforts to establish and manage any strategic alliances, the success and
timing of any new product introductions, dependence on external financing,
product availability, market conditions, and general economic conditions.