ZENN Motor Company Reports Third Quarter Fiscal 2008 Results

ZENN Motor Company Inc. ("ZMC" or the "Company")(TSX VENTURE: ZNN) today announced the financial results for the three months and nine months ended June 30, 2008. All amounts are expressed in Canadian dollars unless otherwise indicated.

Financial Results

For the current quarter and nine months ended June 30, 2008, gross revenue was $977,305 and $2,618,477 respectively compared to $862,256 and $1,646,443 in the corresponding prior periods. The Company recorded a provision for rebates in the current three and nine month periods in the amount of $14,980 and $314,574 relating to a marketing program initiated in September 2007. Unit sales increased in the current period to 67 and 190 year to date from 60 and 113 in the comparable prior periods.

Net loss for the three months and nine months ended June 30, 2008 was $1,910,304 and $5,425,895 or $0.06 and $0.18 per share respectively compared with a net loss of $1,566,955 and $4,316,052 or $0.06 and $0.17 per share respectively for the corresponding periods in the prior year.

At June 30, 2008 the Company had working capital of $16,966,685 including cash and cash equivalents of $16,181,151 compared to working capital of $6,944,190 including cash and cash equivalents of $6,221,257 as at September 30, 2007.

The Company is pleased to report progress on a number of key areas. The 2008 ZENN with its innovative air conditioning system has opened up additional markets in the southern United States. In the current quarter, Florida represented 22% of the orders booked in the period. "The level of activity in Florida sets a positive trend for future periods" says Ian Clifford, CEO of ZENN Motor Company. "We know from experience, that the payback on targeted marketing programs can be several quarters later, so to see this immediate uptake is a strong endorsement for our 2008 ZENN."

California, where the Company conducted a marketing campaign in late 2007 continues to be an active market. In the current fiscal quarter, California represented 38% of orders booked, an increase from 15% in the same quarter of the previous year.

The Company also completed a short form prospectus offering of common shares in the quarter ended June 30, 2008. On May 30, the Company issued 4,060,000 common shares for gross proceeds of $15,225,000. "There was significant interest in our long-term business strategy when we were marketing our shares" says Clifford. "The additional capital allows us to execute on the development of new products and strategies relating to the highway capable cityZENN(TM) and the ZENNergy(TM) drivetrain projects for new zero emission vehicles and the retrofit of used internal combustion vehicles from gas to electric drive".

The Company's strategic partner in power storage technology, EEStor, Inc. announced through a press release on July 29, 2008 its progress in advancing the commercialization efforts of its technology. The Company viewed this announcement as confirmation that significant progress is being made toward the third-party verified permittivity results and ultimately, the development of a commercial product.

Additional Information

Readers are encouraged to read the Company's unaudited consolidated financial statements for the three months and nine months ended June 30, 2008, the corresponding Management's Discussion and Analysis, the Company's Annual Information Form dated January 21, 2008 and the Company's audited financial statements for the years ended September 30, 2008 and 2007, all of which are available at www.sedar.com or the Company's website at www.ZENNcars.com.

The Company's Annual and Special Meeting of shareholders held on March 28, 2008 was broadcast live as a webcast and is available on-line through the Company's website.

ABOUT ZENN Motor Company Inc.

ZENN Motor Company is dedicated to being the global leader in producing zero emission transportation solutions for markets around the world. The Company's current ZENN car is the perfect vehicle for urban commuters, fleets (such as resorts, gated communities, airports, college and business campuses, municipalities and parks), the environmentally conscious driver, and consumers who just want to save money. The ZENN is sold through a growing network of retailers across the United States.

The ZENN is a fully electric low speed vehicle (LSV) with European styling and appointments that offers customers tremendous operational cost savings compared to a vehicle powered by an internal combustion engine. Recently named "Commuter King of the Plug-ins" by Newsweek Magazine, the 2008 ZENN is ultra nimble quick from a stop and perfect for small parking spaces and San Franciscan slopes.

The potential commercialization of the high power-density ceramic ultra capacitor being developed by the Company's strategic partner, EEStor Inc. for future ZENN vehicles will enable them to travel at highway speeds and extended distances comparable to a traditional car but at a fraction of the cost.

Forward-looking Statement

Certain statements in this release may contain "forward-looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995 and applicable Canadian securities legislation. Generally, these forward-looking statements can be identified by the use of forward-looking terminology such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or state that certain actions, events or results "may", "could", "would", "might" or "will be taken", "occur" or "be achieved". Forward-looking statements are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of ZENN Motor Company Inc. to be materially different from those expressed or implied by such forward-looking statements including but not limited to those risk factors discussed in the Company's most recent Annual Information Form. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. ZMC does not undertake to update any forward-looking statements, except in accordance with applicable securities laws.

ZENN Motor Company Inc.
Consolidated Balance Sheet

--------------------------------------------------------------------------
                                           Jun. 30 2008       Sep. 30 2007
                                             (unaudited)          (audited)
                                                      $                  $
--------------------------------------------------------------------------

Assets
Current
 Cash and cash equivalents                   16,181,151          6,221,257
 Accounts receivable                            295,306            272,946
 Inventory                                    1,885,877          1,442,862
 Prepaid expenses and other assets              296,856            642,061
                                           ------------       ------------
                                             18,659,190          8,579,126
Property, plant and equipment                   332,313            353,047
Deferred development costs                      169,915                  -
Rental deposits                                  94,978            100,535
EEStor technology rights                      1,510,145          1,510,145
Equity investment in EEStor, Inc.             2,857,815          2,857,815
                                           ------------       ------------

                                             23,624,356         13,400,668
                                           ------------       ------------
                                           ------------       ------------

Liabilities
Current
  Accounts payable and accrued liabilities    1,692,505          1,634,936
                                           ------------       ------------
Shareholders' Equity
Capital stock                                41,198,210         26,081,655
Contributed surplus                           1,158,397            584,455
Warrant capital                                 477,425            575,908
Deficit                                     (20,902,181)       (15,476,286)
                                           ------------       ------------

                                             21,931,851         11,765,732
                                           ------------       ------------

                                             23,624,356         13,400,668
                                           ------------       ------------
                                           ------------       ------------



ZENN Motor Company Inc.
Consolidated Statement of Operations and Deficit
For the three months and nine months ended June 30
(unaudited)

--------------------------------------------------------------------------
                                     Three Months              Nine Months
                                     ------------              -----------
                               2008          2007        2008         2007
                               ----          ----        ----         ----
                                  $             $           $            $
--------------------------------------------------------------------------

Gross revenue               977,305      862,256    2,618,477    1,646,443
 Provision for rebates       14,980            -      314,574            -
                         ----------   ----------   ----------   ----------
Net revenue                 962,325      862,256    2,303,903    1,646,443

Cost of sales               933,104      857,954    2,200,804    1,623,375
                         ----------   ----------   ----------   ----------

Gross profit                 29,221        4,302      103,099       23,068

Expenses
 Modification and
  engineering               155,202      128,059      488,894      395,511
 General and
  administrative          1,145,950      896,057    3,427,189    2,703,596
 Marketing and promotion    645,307      375,094    1,625,274    1,012,712
 Foreign exchange
  loss (gain)                12,279       22,009      (15,943)      36,505
 Amortization                39,331       24,403      106,204       63,517
 Inventory write-down             -      181,817       59,367      227,500
                         ----------   ----------   ----------   ----------
                          1,998,069    1,627,439    5,690,985    4,439,341
                         ----------   ----------   ----------   ----------

Loss from operations     (1,968,848)  (1,623,137)  (5,587,886)  (4,416,273)
Interest income              58,544       56,182      161,991      100,221
                         ----------   ----------   ----------   ----------

Net loss for the period  (1,910,304)  (1,566,955)  (5,425,895)  (4,316,052)

Deficit, beginning
 of period              (18,991,877) (11,249,241) (15,476,286)  (8,500,144)
                         ----------   ----------   ----------   ----------

Deficit, end of
 period                 (20,902,181) (12,816,196) (20,902,181) (12,816,196)
                         ----------   ----------   ----------   ----------
                         ----------   ----------   ----------   ----------

Loss per share,
 basic and diluted            (0.06)       (0.06)       (0.18)       (0.17)

Weighted average number
 of shares outstanding   30,763,614   27,575,573   29,546,615   25,013,421



ZENN Motor Company Inc.
Consolidated Statement of Cash Flows
For the three months and nine months ended June 30
(unaudited)

--------------------------------------------------------------------------
                                     Three Months              Nine Months
                                     ------------              -----------
                               2008          2007        2008         2007
                               ----          ----        ----         ----
                                  $             $           $            $
--------------------------------------------------------------------------

Cash flows from (to)
 operating activities
 Net loss for period     (1,910,304)   (1,566,955) (5,425,895)  (4,316,052)
 Add items not
  affecting cash flow
  Amortization               39,331        24,403     106,204       63,517
  Stock based
   compensation             211,748       112,444     573,943      283,481
                         ----------    ----------  ----------   ----------
                         (1,659,225)   (1,430,108) (4,745,748)  (3,969,054)

Changes in non-cash
 working capital
 Accounts receivable         67,722       (13,407)    (22,362)    (208,606)
 Inventory                 (229,796)      611,948    (443,015)    (930,535)
 Prepaid expenses and
  other assets              325,659        17,579     345,200      102,278
 Accounts payable and
  accrued liabilities       169,665       (46,458)     57,569     (276,779)
                         ----------    ----------  ----------   ----------
                         (1,325,975)     (860,445) (4,808,356)  (5,282,696)
                         ----------    ----------  ----------   ----------

Cash flow from (to)
 investing activities
 Property, plant and
  equipment                 (53,565)      (48,487)    (85,464)    (189,412)
 Deferred development
  costs                    (123,336)      (16,800)   (169,915)     (60,720)
 Rental deposits             (3,658)          387       5,557      (28,228)
 Technology rights                -             -           -     (643,170)
 Shares of EEStor, Inc.           -    (2,857,815)          -   (2,857,815)
                         ----------    ----------  ----------   ----------
                           (180,559)   (2,922,715)   (249,822)  (3,779,345)
                         ----------    ----------  ----------   ----------

Cash flow from (to)
 financing activities
 Issue of shares, net
  of costs               14,086,598     4,766,615  14,086,598   14,097,782
 Exercise of warrants             -             -     931,474            -
                         ----------    ----------  ----------   ----------
                         14,086,598     4,766,615  15,018,072   14,097,782
                         ----------    ----------  ----------   ----------

Increase (decrease) in
 cash and cash
 equivalents during
 period                  12,580,064       983,455   9,959,894    5,035,741
Cash and cash
 equivalents at
 beginning of period      3,601,087     6,269,248   6,221,257    2,216,962
                         ----------    ----------  ----------   ----------
Cash and cash
 equivalents at
 end of period           16,181,151     7,252,703  16,181,151    7,252,703
                         ----------    ----------  ----------   ----------
                         ----------    ----------  ----------   ----------

The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.