Deviation of 20% in Share Price

The recent increase in the closing price of the company's shares over three consecutive trading sessions represents a deviation of 20%, thus constituting an unusual price movement.

In responding to rumors that the annual lithium-ion battery production capacity of Qingdao Aucma New Energy Technology Co., Ltd. (QANET), a subsidiary of the company, has increased from 60 mln batteries to 80 mln batteries; the company herein clarifies that the production and operation of QANET's lithium-ion battery project has not satisfied the company's expectations. Therefore, according the company's development strategy, it plans to terminate the project.

The board of directors confirms that other than the aforementioned information, there are no significant undisclosed issues outstanding, pursuant to relevant regulations, nor are there any related negotiations, plans, intentions or agreements that might materially impact the company's stock price.

The China Securities Journal, the Shanghai Securities News, the Securities Times and the website of the Shanghai Stock Exchange (www.sse.com.cn) are the company's designated media for information disclosure. Investors are advised to exercise caution when dealing in the company's shares.

Board of Directors
22 Oct 2008


Source: Shanghai Stock Exchange

Date: 23 Oct 2008

CN01/SC/RL/JE/KM