Electric Vehicle Division News

Electric Fuel Reports German Government Issues Contract for
All-Electric Hybrid Vehicle Development

— Consortium to Begin DM24 Million Program to Develop
Hybrid Vehicle —

September 15, 2000 — Electric Fuel Corporation (Nasdaq: EFCX) announced today that the German Government has issued a contract to undertake a cooperative all-electric hybrid vehicle development and demonstration program in Germany.

A consortium comprised of Electric Fuel's Electrical Vehicle Division, and major German industrial firms such as DaimlerChrysler AG and Varta Batterie AG, as well as academic institutions will implement the program, announced in January.

The four-year, DM24 million program will develop and demonstrate a hybrid vehicle design based on DaimlerChrysler cargo vans. The vans will be powered by Electric Fuel's refuelable Zinc Air(TM) batteries as the main energy storage, together with high-power booster batteries provided by Varta, and ultracapacitors under development by Dornier GmbH (a division of DaimlerCrysler Aerospace) and by EPOC AG (formally Siemens Matsushita Components).

The organizers of the project, including the German Federal Science Ministry, which will co-fund the program along with the consortium members, hope it will eventually lead to high-performance, clean electric transportation.

According to Yoel Gilon, Electric Fuel's Director of EV Technologies, “It is gratifying to be part of the technical direction taken by the consortium to create an electric hybrid that meets all of the requirements of the modern fleet vehicle.” Mr. Gilon added, “This is the same direction we have taken in the United States with our all-electric battery-battery hybrid transit bus project.”

About Electric Fuel

Electric Fuel with corporate and sales offices in New Jersey, and manufacturing and R&D facilities in Israel and Alabama, is a world leader in the application of primary and refuelable zinc-air battery technology to innovative energy solutions. The company's popular line of Instant Power(TM) disposable batteries for cellular telephones is available through selected outlets in the U.S., Europe, South America and Israel. Electric Fuel also recently announced plans to sell a new Instant Power(TM) universal powerpack for cellphones and PDAs that will let wireless users keep talking or working, even as their rechargeable battery runs down.

NOTE: This press release contains forward-looking statements. There are certain important factors that could cause results to differ materially from those anticipated by the statements made above as set forth in Electric Fuel's annual report on Form 10-K for the fiscal year ended December 31, 1999. Among, but not limited to these factors, are the stage of development of Electric Fuel's products, the uncertainty of the market for disposable cellular telephone batteries and significant future capital requirements.