SOURCE: China Auto Logistics, Inc.

China Auto Logistics, Inc.

April 29, 2009 07:00 ET

China Auto Logistics Launches Twelfth Domestic Auto Website in Thriving Suzhou With a Special Focus on Rural Car Buyers

Company's Domestic Sites Now Reach Areas With 70%-80% of All Current Auto Sales in China

TIANJIN CITY, CHINA--(Marketwire - April 29, 2009) - China Auto Logistics Inc. (OTCBB: CALG), one of China's leading importers of luxury automobiles, originator of two of China's leading automobile websites, and a top provider of one-stop auto-related logistics and dealer financing, reported today that it has successfully launched its twelfth domestic automobile website in the very prosperous city of Suzhou, in the province of Jiangsu, approximately 80 kilometers from Shanghai.

While the city is famed for its historic canals and gardens on the shores of Lake Taihu, Suzhou's 6.2 million residents also own more than 1.7 million automobiles, making it the third largest city in China in terms of auto ownership behind Beijing and Shanghai. With 2008 GDP per capita of more than $15,300, it also ranks second in this category among China's 659 cities.

Mr. Tong Shiping, CEO and president of China Auto Logistics, stated, "While Suzhou's size and comparative affluence were key reasons for choosing it as one of our core sites, we are also particularly interested in the fact that its rural population for some time has been ranked as having the fastest growing per capita income in China. For Suzhou and for China as a whole, we believe that automobile sales to rural residents will be the engine behind the anticipated continuing advance in auto buying in 2009 and beyond."

Government Assistance to Rural Residents

According to the Company, one of the key elements of the massive economic stimulus program inaugurated by the Chinese government this year has been a program to provide incentives to purchase automobiles to the more than 700 million citizens living in rural areas. The Company anticipates active buying from this segment of the population based on grants provided by the government, no-interest loans provided by rural credit associations and discounted prices from auto manufacturers which have lowered purchase prices by 10% or more.

"Statistics we have seen estimate that in 2009 the more than $732 million in government grants will translate to sales of more than one million auto units, with this being one of the key reasons for China's expected ascendancy this year to becoming the number one automobile market in the world," Mr. Shiping noted.

New Approaches to Reach Rural Customers

The Company said that over the past several months it has invested considerable effort to study behavior and consumption patterns of rural residents. Based on this, it has worked closely with the more than 140 4S shops (automobile dealers) in Suzhou to develop unique content and graphics on its website for marketing to this important consumer niche. Included among the experimental approaches it is utilizing are channels directed exclusively to "rural" cars, such as pick-up trucks, small engine low-end cars, as well as information and quotations on three-wheeled vehicles.

"Day by day our excitement grows about the potential of this market and the progress being made to win advertising and subscriptions from the Suzhou 4S dealer base. In the longer run, we also clearly envision a growing contribution to our revenues from the value-added services we intend to provide online, which we expect will eclipse the revenues from all other sources," Mr. Shiping stated.

National Website On Track

Mr. Shiping concluded, "As per our announced strategy, with our twelfth domestic automobile website now in place, reaching 70% to 80% of all car buyers in China, we expect to announce shortly the launch of our national website providing accurate regularly updated information for consumers and dealers on a national scale. This will supplement the local information we are now providing on a city by city basis. We expect this will further elevate China Auto Logistics' unique, leadership position in China's dynamic and growing auto industry."

Description of China Auto Logistics Inc.

Founded in 1995, with profitable sales in 2008 of approximately $190 million (+25%), the Company has grown to become one of the top importers of luxury vehicles in China. Imported luxury automobiles have been the fastest growing segment of the still young Chinese automobile industry. The Company has fueled its sales and profit growth by also becoming one of China's top logistical servicing and dealer financing companies for other automobile importers. Additionally, it is a leader in providing accurate pricing and other automobile-related information with its two web portals,, aimed at the import market, and (in Tianjin), which it is expanding throughout China to reach the much larger market of domestically manufactured automobile purchasers and dealers. Going forward, the Company's growth strategy is focused on expansion of its highly profitable websites and auto-related services, including new online services for domestic auto dealers that it expects to make available. 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

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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