ZAP Reports Profits of $1.15 Million for Fiscal 2002

SEBASTOPOL, Calif. (April 1, 2003) – Electric transportation company ZAP (OTC BB:ZAPZ) today announced that it has recorded net profits of $1.15 Million for the fiscal year ended December 31, 2002 after recording a $3.9 million extraordinary gain of long-term debt that was converted into common stock. Net earnings were $0.28 per share. In addition to the extraordinary gain, results for ZAP's operations during 2002 also reflect mergers with The RAP Group, Inc. and Voltage Vehicles (VV), two automotive marketing companies. Management notes that the results for 2002 include two quarters activity for the newly acquired companies as of July 1, 2002. Net sales for the year ended December 31, 2002 were $4.4 million compared with $5 million in the prior year. RAP’s net sales for the period accounted for $2.6 million. Prior to the extraordinary gain and mergers, net sales for ZAP were $1.8 million versus $4.9 million for the same period in 2001. Net operating losses prior to the extraordinary gains were $2.6 million in 2002 versus $9.2 million in 2001. Officials at ZAP say the Company has taken action in 2002 to decrease the prior year's operating losses, such as the reorganization, the mergers with RAP and VV, cost-cutting, and making the transition from a manufacturer to a marketing company. The groundwork laid in 2002 has helped position ZAP to move forward with its business plan and respond to increasing demand for electric transportation. ZAP noted the following new developments: - In 2002, ZAP signed an exclusive agreement with Daka Development Ltd, for the design, manufacturing and marketing of a full line of advanced transportation and alternative energy products, including Daka's SEA-DOO® SEASCOOTER™. In June, Daka granted ZAP a $500,000 loan for inventory financing of Daka’s items. In September, Daka exercised its option to convert the entire amount of the note to ZAP common stock and has agreed to additional financing in 2003. - VIENTO™ – In January 2003, ZAP signed an agreement with The Electric Cycle Company, a California company that makes a new moped-class electric scooter called the VIENTO that ZAP says sets a new standard in electric vehicle performance. The VIENTO is one of the only purpose-built electric motorbikes in production, representing more than seven years of research and development in electric propulsion design and engineering. - ZAP received worldwide media coverage in January 2003 at the Consumer Electronics Show (CES) in Las Vegas, the world's largest new technology exposition, where it showcased a new electric car under development and announced a lithium-ion battery technology that has the potential to quadruple the range of today's electric vehicles. - SEASCOOTER™ - Based on the holiday response as well as first quarter sales for the new SEASCOOTER, ZAP has expanded its marketing program for the electric dive propulsion vehicle. In February, ZAP announced it had received a $250,000 sales order from a distribution company in Mexico. The affordability of the dive and snorkeling vehicle has attracted additional demand from boat owners and the swimming pool market. - ZAP's new Light Utility Vehicle (The ZAP L.U.V.™) has received international media coverage with CNN, the Discovery Channel, TECH-TV, Home & Garden television and others, as well as popular magazines like Motortrend. Voltage Vehicles, a subsidiary of ZAP, has signed an exclusive agreement with a European-based group of companies involved in the design and manufacturing of electric automobiles. The group has started production on several different types of light electric utility vehicles for urban transportation and commercial use. The L.U.V., a 25 MPH neighborhood electric car, is the first of these vehicles to be available. - On March 25, 2003, ZAP purchased a three-story office building in downtown Santa Rosa, California at 501 Fourth Street with approximately 20,000 square feet of space. The new facility will be the corporate headquarters and a retail store for ZAP. - ZAP to date has delivered more than 80,000 electric vehicles worldwide and has been acknowledged as a leader in electric transportation by Time Magazine, The Wall Street Journal, Advertising Age and Industry Week. Company officials believe ZAP is one of the strongest brand names in alternative transportation. The names ZAP and ZAPPY have become a generic term for electric bicycles and scooters. - Record gas prices in March 2003 have directed worldwide recognition towards battery-powered vehicles, particularly in light of mounting concerns about air pollution, energy security, global climate change, ozone depletion, dependence on foreign oil, as well as concerns for global political, military and economic conditions. - The Company has a $2.1 million backlog of orders and purchase contracts in hand for electric vehicles as of March 28, 2003. The Company expects to fill its entire backlog within the current fiscal year.