China Auto Logistics (NasdaqGM:CALI)

Prior to becoming a public company in 2009, management established a growth strategy aimed at achieving above average year over year bottom line growth, capitalizing on our successful experience creating and operating web-based services which have catapulted our luxury imported auto sales business to the number one position in the industry. In the period since, we have been highly successful: web-based advertising revenue from our auto-related websites and portal, new services such as auto mall management, and the expansion of existing services such as short term dealer financing, now contribute more than half of our growing net operating income.

Looking ahead, key elements of our growth strategy are:

• Continuing to grow our high margin auto-related web-based services in order to expand gross margins and generate increases in net profits;
• Greatly expanding our footprint in China's world leading domestic auto business, which is much larger than the luxury imported auto segment;
• Achieving growth in website revenues as a consequence of continuing geographic expansion - - with an aim to reach 70% of China's auto-buying public by 2012 - - as well as by adding new auto-related web-based services and expanding existing ones with an aim to equally balance web-based advertising and web-based services profits;
• Acquiring and expanding a domestic auto mall in Tianjin to greatly expand domestic auto sales and support the growth of our auto-related services;
• Continuing to focus on the sale of high end and luxury autos in our imported auto sales operation, slowing the rate of growth in sales, but increasing the opportunity for improved margins;
• Capitalizing on and maintaining our financial strength, e.g., continuing to expand our facility credit lines through our strong banking relationships to support the growth of imported and domestic auto dealer financing and pave the way for providing new dealer and consumer services.