China Automotive Systems wins Dongfeng Peugeot contract

China Automotive Systems, Inc. (Nasdaq: CAAS), a leading power steering components and systems supplier in China, yesterday announced that its subsidiary, Jingzhou Henglong Automotive Parts Co., has signed a supply agreement with Dongfeng Peugeot Citroen Automobile Co. Ltd. (DPCA).

Beginning from July, Henglong will ship 3000 units of power steering gears per month to DPCA for its Dongfeng Peugeot 206 model. DPCA and Henglong are also in the process of finalizing commercial orders for two other models -- Dongfeng Elysee R23 and Dongfeng Picasso N68.

Mr. Qizhou Wu, Chief Executive Officer of China Automotive Systems, stated, "After winning the FAW Volkswagen contract last year, we are excited to enter another European automakers'auto parts purchasing system in China. After an almost three-year evaluation, Peugeot has approved the performance and quality of our products to be installed in their flagship vehicles in China. We will continue to focus on broadening our product offerings and maintaining high-quality standards to win key contracts from major automakers in China."

According to China Association of Automobile Manufacturers, Dongfeng Peugeot Citroen Automobile Co. Ltd. produced over 213,000 vehicles and sold 207,000 vehicles in 2007. Peugeot was consistently ranked in a top 10 sedan producer in China since 2005.