JINHUA, CHINA--(Marketwire - May 15, 2012) - Kandi Technologies, Corp. (NASDAQ: [ KNDI ])

ATV and Go-Kart Model Changes Spurred Sharp Sales Increases While EV Sales Continued To Trend Up

Kandi Technologies, Corp.(the 'Company' or 'Kandi') (NASDAQ: [ KNDI ]), a leading Chinese manufacturer and developer of pure electric vehicles (EVs) and all-terrain vehicles (ATVs), today reported financial results for the first quarter ended March 31, 2012.

During the quarter, the Company continued to focus on building a leadership position in the emerging EV market in anticipation of what it believes will be a "breakthrough" year for the Company. At the same time, it stayed focused on its traditional off-road vehicle (ORV) business, with the introduction of new lower priced ATV and go-kart models. The result was a sharp improvement in sales of these products that led to a 72% increase in first quarter revenues and a 121% increase in operating income compared with the first quarter of 2011.

For the three months ended March 31, 2012:

• Revenues grew 72% to $14.36 million from $8.34 million last year as year over year ATV sales grew 41% to $2 million and go-kart sales grew approximately 95% to $9.6 million;
• ATV unit sales grew to 5,124 units in the quarter, up 216% from 1,620 units a year ago, while go-kart unit sales increased 142 % year over year to 12,981 units up from 5,366 units in last year's first quarter;
• Operating income rose 121% to $1.81 million as gross profits grew approximately 62% to $3.3 million compared with $2.06 million in the first quarter of 2011;
• Non-GAAP adjusted net income (*) grew 124% to $1.47 million or 0.05 per share compared with $0.66 million or 0.02 per share a year earlier;
• GAAP net income was $2.38 million or $0.08 per share diluted compared with $5.94 million or $0.20 per share diluted in the 2011 first quarter;
• Super-mini car revenues grew nearly 15% to approximately $1.2 million, but unit sales grew approximately 42% to 296 vehicles, from 209 a year earlier, reflecting increased sales of EVs;
• Working capital surplus remained approximately $20 million year over year.

Commenting on the continued turnaround in ORV sales, Mr. Xiaoming Hu, Chairman and CEO of the Company, said, "These were particularly pleasing results since our first quarter usually is slow due to the Chinese New Year Holiday and the pace of recovery in most economies has continued to be slow. The growth we achieved reflects the strength of our brand, and our market leadership, which augers well for future demand for our products."

EV Milestones

During the quarter, the Company continued to achieve new milestones in its developing pure EV business, including:

• Kandi's pure electric cargo vehicle model KD5021XXYBEV was included on the "Energy-Saving and New Energy Vehicle Demonstration and Promotion for Use Project" list issued by the Ministry of Industry and Information Technology of China on February 29^th, 2012
• The company entered into a Share Exchange Agreement with KO NGA Investment Limited on February 13^th, 2012 to acquire EV parts developer and manufacturer Yongkang Scrou Electric Co., Ltd. The Exchange Agreement closed on April 25, 2012, when KO NGA became a wholly-owned subsidiary of the Company
• Kandi's pure EV (model number KD5011XXYEV) was among the first vehicles included on the list of Energy-Saving and New EVs that qualify for the recently enacted Registration Tax Reduction and Exemption. The list was issued and released by the Ministry of Finance, the Ministry of State Administration of Taxation and the Ministry of Industry and Information Technology of China on March 6^th, 2012. Consumers that purchase the KD5011XXYEV model are exempt from paying the annual registration tax required of other vehicle owners starting January 1, 2012.

Mr. Hu concluded, "We are well positioned to benefit from the growing momentum for increased EV sales boosted by subsidies and are excited by the developments we see ahead. With our recent acquisition, we also expect to be a more fully integrated provider of pure electric vehicles which should help us expand our market share in new markets."

*EXPLANATION OF NON-GAAP RESULTS

In addition to disclosing financial results in accordance with United States (U.S.) generally accepted accounting principles (GAAP), this earnings release contains non-GAAP financial measures that we believe are helpful in understanding and comparing our past financial performance and our future results. These non-GAAP financial measures should not be considered a substitute for, or superior to, financial measures calculated in accordance with GAAP, and the financial results calculated in accordance with GAAP and reconciliations from these results should be carefully evaluated. Management believes the non-GAAP financial measures are appropriate for period to period comparisons in our budget, planning and evaluation processes, and to show the reader how our performance compares to other periods. Our non-GAAP financial measures reflect adjustments based on the following items, as well as the related income tax effects: Non-GAAP net income and losses, and related per share amounts as reported for Q1 2012 exclude the effects of all option related expenses, stock award expense, Convertible Note interest expense, effects caused by amortization of discounts, on Convertible Notes, and the change of the fair value of financial derivatives.

About Kandi Technologies, Corp.

Kandi Technologies, Corp. (NASDAQ: [ KNDI ]) is a manufacturer and exporter of a variety of vehicles in China, making it a world leader in the production of popular off-road vehicles (ORVs). It also ranks among the leading manufacturers in China of all-terrain vehicles (ATVs), specialized utility vehicles (UTVs), and a recently introduced second-generation high mileage, two-seat three-wheeled motorcycle. Another major company focus has been on the manufacture and sale of the COCO electric vehicle (EV), a highly economical, beautifully designed, all-electric super mini-car for neighborhood driving and commuting. The convertible and hardtop models of the COCO EV are available in the United States and other countries, while the Chinese government has approved the sale of Kandi EVs in China since 2010. The Company's products can be viewed at [ http://www.kandivehicle.com ] and its corporate website is [ http://www.chinakandi.com ].

Safe Harbor Statement

This press release contains certain statements that may include "forward-looking statements." All statements other than statements of historical fact included herein are "forward-looking statements." These forward-looking statements are often identified by the use of forward-looking terminology such as "believes," "expects" or similar expressions, involving known and unknown risks and uncertainties. Although the Company believes that the expectations reflected in these forward-looking statements are reasonable, they do involve assumptions, risks and uncertainties, and these expectations may prove to be incorrect. You should not place undue reliance on these forward-looking statements, which speak only as of the date of this press release. The Company's actual results could differ materially from those anticipated in these forward-looking statements as a result of a variety of factors, including the risk factors discussed in the Company's periodic reports that are filed with the Securities and Exchange Commission and available on the SEC's website ([ http://www.sec.gov ]). All forward-looking statements attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by these risk factors. Other than as required under the securities laws, the Company does not assume a duty to update these forward-looking statements.