Major Auto Tio Keep Long Island City Dealerships Sell Two Others

    LONG ISLAND CITY, N.Y.--Sept. 6, 2002--The Major Automotive Companies, Inc. announced today that it has terminated discussions to sell its Major Chrysler/Jeep dealership and its Major Dodge dealership, both based in Long Island City, NY.
    The Company noted that as a result of its new floor plan credit agreement with HSBC Bank for the financing of these dealerships' new and used vehicle inventories, it would be more advantageous to the Company to retain these dealerships.
    Separately, the Company announced that as a result of the Ford Motor Corporation's Lincoln Mercury division's ("L-M") regional plan, the Company's Compass Lincoln Mercury dealership in Orange, NJ will resign from its sales and service agreement with L-M. In exchange, L-M will provide the Company with "financial assistance" in the form of a cash payment in an amount that is approximately equal to the fair value of this dealership.
    The Company is currently evaluating its options with respect to its Compass Dodge dealership.
    Additionally, the Company announced that its Hempstead Mazda operation has voluntarily terminated its dealership agreement with Mazda Motors of America, Inc., d/b/a Mazda North American Operation ("Mazda America"). Accordingly, Mazda America will purchase the dealerships assets from Hempstead Mazda.
    Aggregate sales of the Compass Lincoln Mercury and the Hempstead Mazda dealerships generated approximately 5% of the Company's total revenues and gross profit in the first six months of 2002.
    These transactions, when and if completed, are expected to provide the Company with an opportunity to concentrate its efforts at continuing to improve the results at its more profitable dealership operations in Long Island City, Queens and Hempstead, Long Island.
    The Major Automotive Companies is a leading consolidator of automotive dealerships in the New York Metropolitan area. For additional information, visit the Company's website at http://www.majorauto.com/.

    The information contained in this press release, including any "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 contained herein, should be reviewed in conjunction with the Company's annual report on Form 10-K and other publicly available information regarding the Company, copies of which are available from the Company upon request. Such publicly available information sets forth many risks and uncertainties related to the Company's business and such statements, including risks and uncertainties related to that are unpredictable and outside of the influence and/or control of the Company.