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(a Sino-foreign joint stock limited company incorporated in the People’s Republic of China)
(Stock Code: 1122)
ANNOUNCEMENT
CONNECTED TRANSACTION

Establishment of Joint Venture
The Board wishes to announce that on 28 December, 2007, the Company and Isuzu entered
into the JV Agreement and the JV Articles to jointly invest in Qingling Isuzu (Chongqing)
Automobile Sales and Service Co., Ltd., an automobile dealer established in Chongqing City, the
PRC, to engage in the sale of vehicles and their parts manufactured by the Group, development of
after-sales service and supply of parts for maintenance. Pursuant to the JV Agreement, each of the
registered capital and the total investment of the JV Company will be US$4,600,000 (equivalent
to approximately HK$35,880,000). The JV Company will be owned as to 50% by the Company
and 50% by Isuzu.
The Directors consider that the terms and conditions of the JV Agreement and the JV Articles are
fair and reasonable and in the interests of the Company and its shareholders as a whole.
The establishment of the JV Company constitutes a connected transaction of the Company
under the Listing Rules. Given that each of the relevant Percentage Ratio is less than 2.5%,
the establishment of the JV Company is exempt from independent Shareholders approval
requirements but only subject to reporting and announcement requirement under Rule 14A.32 of
the Listing Rules.
THE JV AGREEMENT

Date
28 December, 2007
Parties
The Company and Isuzu

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Isuzu is a substantial shareholder holding approximately 40.08% of the issued H shares in the share
capital of the Company which amounts to approximately 20% of the entire issued share capital of
the Company (consisting of H Shares and the domestic shares).
Condition Precedent
The JV Agreement and the JV Articles are conditional upon the granting of the relevant approval
and/or completion of the relevant procedures under the applicable laws, rules and regulations, and
will become effective upon approval by the relevant PRC authorities.
Business
Pursuant to the JV Agreement, it is agreed between the Company and Isuzu that:
(a) Sale of products:
The JV Company will be engaged in (i) the sale of products in the brand of “Isuzu”
manufactured by the Group, including vehicles, assembly and the parts for maintenance and (ii)
the development of after-sales service for the products in the brand of “Isuzu” manufactured by
the Group and supply of the parts for maintenance.
(b) Targeted sales volume
The targeted sales volume is expected to be 1,000 vehicles per annum for the years 2008 and
2009. The targeted sales volume shall be adjusted by the board of directors of the JV Company
based on the then operation condition of the JV Company and the then market condition.
Term
30 years from the date of issue of the business licence of the JV Company.
Capital Structure
Each of the registered capital and the total investment of the JV Company will be US$4,600,000
(equivalent to approximately HK$35,880,000). Save for such capital contribution, the Company
does not have any other capital commitments in the JV Company under the JV Agreement.
As for the registered capital of the JV Company, the Company will contribute RMB in cash
equivalent to US$2,300,000 and Isuzu will contribute in cash US$2,300,000 (equivalent to
approximately HK$17,940,000). The Company shall pay such capital contribution within 30 days
after the date of issue of the business licence. Funding of the Company’s portion of registered
capital in the JV Company will be fi nanced by internal resources of the Company.
Board of directors
The board of directors of the JV Company will consist of six directors. The Company and Isuzu
will have the right to appoint half of the members to the board of directors of the JV Company

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respectively. The Company is entitled to appoint the chairman to the board of directors of the
JV Company and Isuzu is entitled to appoint the vice-chairman. The chairman shall be the legal
representative of the JV Company. Appointment of each director shall be for an initial term of 3
years commencing from the date of issue of the business licence of the JV Company and expiring
on the closure of the fi rst scheduled board meeting of the JV Company being convened immediately
following the expiry of such 3-year period. Such appointment is renewable upon reappointment by
the relevant shareholder upon the expiry of this term.
Matters to be passed by unanimous consent by the directors of the JV Company
The following matters of the JV Company shall require unanimous consent in the board meeting of
the JV Company:
(1) amendments to the JV Agreement and the JV Articles;
(2) suspension, winding up, dissolution or liquidation of the JV Company;
(3) increase, decrease and transfer of registered capital;
(4) merger and dissemination of the JV Company with other entity;
(5) annual profi t distribution plans of the JV Company;
(6) annual operation plans of the JV Company (including the nature of the products, marketing
plans, targeted costs and targeted profi ts); and
(7) setting up of branches.
THE JV ARTICLES

Date
28 December, 2007
Parties
The Company and Isuzu
Principal terms of the JV Articles
The principal terms of the JV Articles are substantially the same as those mentioned under the JV
Agreement in this announcement. Should there be any discrepancies between the terms of the JV
Agreement and JV Articles, terms of the JV Agreement shall prevail.
The Directors, including the independent non-executive Directors, consider that the terms and
conditions of the JV Agreement and the JV Articles are fair and reasonable and in the interests of
the Company and its shareholders as a whole.
REASONS FOR THE JOINT VENTURE

The Company is principally engaged in the production and sales of Isuzu trucks, multi-purposes
vehicles, pick-up trucks, other vehicles and automobile parts and accessories.

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Isuzu is a manufacturer of heavy, medium and small-duty trucks, buses, vehicle engines,
construction and farming machinery, engines, marine engines and generator engines. The shares of
Isuzu are listed on the Tokyo Stock Exchange.
The Directors believe that by the establishment of the JV Company, the Company may have the
opportunity to benefi t from good sales strategies, management skills and services trading ideas
adopted in the world, to enhance the satisfaction level of the market and the customers, to expand
the market share of its products, to enhance economic effi ciency and to allow each party of the JV
Company to enjoy satisfactory economic benefi t. Upon incorporation, the JV Company is expected
to be accounted for and treated as a jointly-controlled entity in the books of the Company.
CONNECTED TRANSACTION

In view of the fact that Isuzu is a substantial shareholder of the Company holding approximately
40.08% of the issued H Shares in the share capital of the Company which amounts to approximately
20% of the entire issued share capital of the Company (consisting of H Share and the domestic
shares), Isuzu is a connected person under the Listing Rules. In that regard, the establishment of the
JV Company by the Company and Isuzu constitutes a connected transaction of the Company under
Rule 14A.13(6) of the Listing Rules. Given that each of the relevant Percentage Ratio is less than
2.5%, the establishment of the JV Company is exempt from independent Shareholders approval
requirements but only subject to reporting and announcement requirement under Rule 14A.32 of the
Listing Rules.
As at the date of this announcement, the Board of Directors comprises 10 directors, of which Mr.
Wu Yun, Mr. Gao Jianmin, Mr. Miyatake Yoshiyuki, Mr. Naotoshi Tsutsumi, Mr. Liu Guangming,
Mr. Pan Yong, Mr. Yue Huaqiang are executive directors of the Company and Mr. Long Tao, Mr.
Song Xiaojiang and Mr. Xu Bingjin are independent non-executive directors of the Company.
TERMS USED IN THIS ANNOUNCEMENT

In this announcement, the following expressions have the meanings set out below unless the context
requires otherwise:
“Board” board of Directors
“Company” Qingling Motors Co. Ltd, a company incorporated in the PRC with
limited liability, the issued H Shares of which are listed on the Stock
Exchange
“connected person” has the meaning ascribed to it under the Listing Rules
“Director(s)” director(s) of the Company
“domestic share(s)” domestic shares of RMB1 each in the share capital of the Company
“Group” the Company, its subsidiaries, its associated companies and its fellow
subsidiaries

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“H Share(s)” overseas listed foreign share(s) of RMB1 each in the share capital of the
Company
“Isuzu” Isuzu Motors Limited, a company incorporated in Japan and listed on the
Tokyo Stock Exchange
“JV Agreement” an agreement in Chinese dated 28 December, 2007 entered into between
the Company and Isuzu to establish the JV Company
“JV Articles” an articles of association in Chinese dated 28 December, 2007 entered
into between the Company and Isuzu to regulate their rights and
obligations as shareholders of the JV Company
“JV Company” Qingling Isuzu (Chongqing) Automobile Sales and Service Co., LtdE
UdU EV/"!, a sino-foreign equity joint
venture to be established in the PRC which is to be owned as to 50% by
the Company and 50% by Isuzu
“Listing Rules” the Rules Governing the Listing of Securities on the Stock Exchange
“Percentage Ratios” the percentage ratios under Chapter 14A of the Listing Rules, other than
the equity capital ratio and profi ts ratio and revenue ratio
“PRC” the People’s Republic of China
“Shareholders” the holders of the H Shares and domestic shares
“Stock Exchange”
By Order of the Board
Qingling Motors Co. Ltd
Wu Yun
Chairman
Chongqing, the PRC, 31 December, 2007
Translation of United States dollars into Hong Kong dollars is based on the exchange rate of US$1.00 = HK$7.8.