SOURCE: China Auto Logistics, Inc.

China Auto Logistics, Inc.

March 05, 2009 07:00 ET

As China's Internet Users Are Reported to Now Exceed 300 Million, China Auto Logistics Stretches Its Domestic Auto Website Southwest

Launches Eleventh Website in Yunnan Province's Growing Capital City of Kunming

TIANJIN CITY, CHINA--(Marketwire - March 5, 2009) - Moving closer to its goal of establishing a "national" website serving China's domestic automobile purchasers and dealers, China Auto Logistics Inc. (OTCBB: CALG) (the "Company"), one of China's leading automobile importers, a top provider of one-stop auto logistics and dealer financing and the originator of two leading automobile websites, announced today the launch of its eleventh www.1365car.com website in Kunming, capital city of Yunnan province in China's southwest.

Long considered a relatively remote backwater city economically, Kunming was known mainly as China's largest grower and supplier of flowers. However, it is now rapidly emerging as a strong economic center with a population of nearly seven million, in a province (Yunnan) with more than 45 million people, that has become a key link to China's Southeast Asian neighbors, and the expected home by 2010 of China's fourth largest airport.

Unsurprisingly, coupled with this new dynamism is the growth being seen in the city's automobile purchases, which have exceeded 18% annually compared to a national average of approximately 10%. This has brought the privately-owned auto rate in the city to about 26% -- double the national rate -- and, with more than one million motor vehicles, Kunming recently was ranked ninth overall in China in this category. At the same time, reflecting growing internet usage in the city, Kunming is being widely blanketed with Wi-Fi connectivity.

"We see Kunming as a very exciting place to be," stated Mr. Tong Shiping, CEO and President of the Company, "providing a growth opportunity not only in Yunnan, but in much of neighboring Guizhuo province as well." He added that the city currently is the home of only 56 4S shops (auto dealers), which has been a limiting factor in the 5000 hits per day achieved by the Company thus far. "However," he said, "based on more than eight months of research, we fully expect continuing growth in both of these numbers."

Formula For Success: Growth In Car Sales And Record Internet Usage

Mr. Shipping commented further, "As we move closer to our goal of achieving national coverage with our domestic automobile website, the confidence we have in the Company's growth strategy is strengthened not only by the continuing growth we are seeing in China's auto sales, but also by the ongoing dramatic expansion in the number of people in China who are utilizing the internet. As reported elsewhere, this number reached more than 300 million in January, and currently is growing at a rate of seven million to eight million new users per month."

"Moreover," he said, "the critical 18 year old to 55 year old user group we are targeting is now spending roughly 44% of their spare time browsing the internet, which according to recent research compares with about 30% worldwide. And, significantly, we also are seeing more than 50% of car buyers doing research online before they visit their local auto dealers. In this growth environment, the opportunity to expand our Company's reach and profitability is very clear."

Description of China Auto Logistics Inc.

Founded in 1995, with profitable sales in 2007 of approximately $152 million, the Company has grown to become one of the top importers and sellers of luxury vehicles in China. Imported luxury automobiles, accounting for more than 10% of all Chinese automobile sales revenues, are the fastest growing segment of the still young Chinese automobile industry, now the largest in the world. The Company has grown sales and profits by becoming one of China's top logistical servicing and financing companies for automobile importers. Additionally, it is a leader in providing accurate pricing and other automobile-related information with its two web portals, www.at188.com, aimed at the import market, and www.1365car.tj.cn, which it is expanding throughout China to reach the much larger market of domestically manufactured automobile purchasers and dealers. Following completion of a successful reverse merger on November 10, 2008, the Company is trading as a fully reporting company in the U.S. with the stock symbol CALG.OB. For additional information, please visit www.chinaautologisticsinc.com.

Information Regarding Forward-Looking Statements

Except for historical information contained herein, the statements in this press release are forward-looking statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve known and unknown risks and uncertainties, which may cause our actual results in future periods to differ materially from forecasted results. These risks and uncertainties include, among other things, product demand, market competition, and risks inherent in our operations. These and other risks are described in our filings with the U.S. Securities and Exchange Commission.

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