D8 Henglong Building
Optics Valley Software Park
Guanshan Road, Wuhan 430073 PRC
What's New
CAAS Forms New Joint Venture with SAIC-IVECO Hongyan Company
New JV will produce 200,000 power steering units for commercial vehicles in China.

HUBEI PROVINCE, China, January 5, 2012 /PRNewswire-Asia-FirstCall/ China Automotive Systems, Inc. (Nasdaq: CAAS) ("CAAS" or the "Company"), a leading power steering components and systems supplier in China, today announced that its Board of Directors has approved the formation of a joint venture with SAIC-IVECO Hongyan Company ("SAIC-IVECO") to create a new manufacturing facility with a capacity to produce 200,000 power steering units for commercial vehicles in China.

The new joint venture, named Chongqing Henglong Hongyan Power Steering Systems Co. Ltd. ("Chongqing Henglong"), has registered capital of RMB60 million and it will be 70% owned by CAAS. SAIC-IVECO will own the remaining 30% of the joint venture which will be located in Chongqing City.

Based in Chongqing City, China, the SAIC-IVECO Hongyan Company has been manufacturing heavy-duty trucks for over 40 years. It designs and manufactures a wide range of heavy-duty trucks and specialty trucks based on heavy-duty trucks such as tractor trucks, dump trucks, cargo trucks, tanker trucks, and some construction engineering vehicles like concrete mixer trucks, dump trucks, and heavy-duty cargo trucks. Truck manufacturing capacity is 70,000 vehicles annually and consists of over 1,000 models, with load capacities ranging between 5 tons to 60 tons.

Mr. Hanlin Chen, Chairman of CAAS, stated, "We are pleased to join forces with SAIC-IVECO, a highly regarded manufacturer of heavy-duty trucks in China. Chongqing Henglong will design and produce power steering units to meet the specific steering characteristics of SAIC-IVECO´s vehicles. The joint venture can also market and sell these steering units to other commercial vehicle manufacturers, especially those located in nearby southwest China, once SAIC-IVECO´s purchase requirements have been fulfilled."

"When our joint ventures become operational, CAAS´s production capacity will be significantly expanded as Chongqing Henglong combines with our Beijing Auto joint venture´s new production capacity of 500,000 steering units. Both our joint venture partners have committed to purchasing the majority of the steering units produced at the respective facilities. These joint ventures will have a positive effect on CAAS´s ability to grow and enhance shareholder value."

About China Automotive Systems, Inc.

Based in Hubei Province, the People´s Republic of China, China Automotive Systems, Inc. is a leading supplier of power steering components and systems to the Chinese automotive industry, operating through nine Sino-foreign joint ventures. The Company offers a full range of steering system parts for passenger automobiles and commercial vehicles. The Company currently offers four separate series of power steering with an annual production capacity of over 3.5 million sets, steering columns, steering oil pumps and steering hoses. Its customer base is comprised of leading Chinese auto manufacturers, such as China FAW Group, Corp., Dongfeng Auto Group Co., Ltd., BYD Auto Company Limited, Beiqi Foton Motor Co., Ltd., Chery Automobile Co., Ltd. and Chrysler North America outside of North America. For more information, please visit: http://www.caasauto.com.

Forward Looking Statements

This press release contains statements that are "forward-looking statements" as defined under the Private Securities Litigation Reform Act of 1995. Forward-looking statements represent our estimates and assumptions only as of the date of this press release. Our actual results may differ materially from the results described in or anticipated by our forward-looking statements due to certain risks and uncertainties, including those described under the heading "Risk Factors" in the Company´s Annual Report on Form 10-K as filed with the Securities and Exchange Commission on June 28, 2011, and in documents subsequently filed by the Company from time to time. The Company expressly disclaims any duty to provide updates to any forward-looking statements made in this press release, whether as a result of new information, future events or otherwise.

For further information, please contact:

Jie Li

Chief Financial Officer

China Automotive Systems

Email: jieli@chl.com.cn

Kevin Theiss

Investor Relations


Tel: +1-646-284-9409

Email: kevin.theiss@grayling.com