Dear Shareholders:

On behalf of the board of directors, I hereby present the annual report of Brilliance China Automotive Holdings Limited for the year ended 31st December, 2008.

The year 2008 had been a turbulent and unprecedented one. The disorder in the global financial markets which originated from the U.S. sub-prime crisis has had tremendous rippling effects that were far reaching and adversely affecting all major industries worldwide. The negative sentiment and liquidity crunch have led to a substantial slowdown in car sales globally. Although the Chinese economy has shown impressive resilience relative to other parts of the world, the Chinese auto sector still experienced slackening sales with growth of only 6.7% in 2008 compared to an annual increase of 21.8% for 2007. According to reports from the China Association of Automobile Manufacturers, 2008 was also the first year the Chinese auto sector experienced non-double digit growth in a decade since 1999.

During the year, our Zhonghua sedan segment experienced a drop in sales volume, while our minibus and premium BMW products continued to exhibit growth. The Group sold 91,356 Zhonghua sedans in 2008, representing a 14.4% decrease from the previous year. The new Junjie FRV, the first model from the brand new A-class line of our Zhonghua products, was introduced to the market in mid-2008. Although the Junjie FRV has been well received since its launch, the short period since introduction resulted in a relatively low volume to support the new A-class platform, and the Junjie FRV model was not profitable in 2008. This was the main reason for the reduced gross margin for 2008.

With respect to our minibus business, despite a difficult operating environment the Group continued to maintain its market leading position in 2008. A total of 73,863 minibuses were sold in 2008, representing a slight increase of 0.6% from the 73,415 units sold in 2007. With its long history, established track record and strong brand recognition, our minibus business continues to be a relatively stable profit contributor to the Group.

The BMW Brilliance joint venture registered sale of 35,068 units in 2008, an increase of 9.2% over that of 2007. The tremendous efforts contributed in the past years by both Brilliance and BMW in the acceleration of component localization and cost cutting are beginning to show results, as demonstrated by the 79.8% increase in profit contribution from the BMW Brilliance joint venture in 2008 compared to the previous year.

Looking forward to 2009, conditions of the auto industry in China will likely continue to be difficult. China has already surpassed the United States in terms of monthly sales, and has become the largest auto market globally. The increasing wealth of the Chinese consumers will continue to drive consumer sector growth in the long run, however uncertainty of possible repercussion from further financial fallout remains in the near term. To combat the current slowdown, the Chinese government has recently announced a series of stimulus packages and favorable policies to entice auto purchases. These policies have already shown positive impacts on the volume sales of our Zhonghua FRV and some of our Hiace minibus products in the first quarter of 2009. In order to boost sales and improve our performance, the Group has implemented various marketing and cost control strategies. The Group will continue to introduce new and next generation models such as the Junjie wagon, Zunchi facelift and A2 of the Junjie FRV line in an effort to enrich our product portfolio and gear up volume. At the same time, the Group is also exploring possible avenues of maximizing the value of our Zhonghua business. In addition, we are working on deepening our cooperation with Toyota on our minibus business. As for our joint venture with BMW, we continue to work closely with our partner to strive for volume growth and cost reduction through further content localization and improved economies of scale. At the same time, we are at an advanced stage of discussion with BMW regarding the joint venture’s phase II expansion plan, as well as the formation of new cooperation in other auto-related businesses in China.

Last but not least, I would like to take this opportunity to express my sincere appreciation to our shareholders and staff for their continued support and dedication to the Group.