8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): August 13, 2009

SORL Auto Parts, Inc.

(Exact name of registrant as specified in its charter)

Delaware	000-11991	30-0091294
(State or other jurisdiction	(Commission	(I.R.S. Employer
of incorporation)	File Number)	Identification No.)
	No. 1169 Yumeng Road Ruian Economic Development District Ruian City, Zhejiang Province People’s Republic of China
	(Address of principal executive offices)

Registrant’s telephone number, including area code: 86-577-6581-7720

N/A

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the Registrant under any of the following provisions (See General Instruction A.2 below):

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

ITEM 7.01 Regulation FD Disclosure.

A copy of the Company’s press release issued on August 13, 2009, regarding the Company’s financial results, is attached hereto as Exhibit 99.1.

ITEM 9.01 Financial Statements and Exhibits.

(d) Exhibits.

There is furnished as part of this report the exhibit listed on the accompanying Index to Exhibits, which is incorporated herein by reference.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: August 13, 2009	SORL Auto Parts, Inc. By:/s/ /s/ Xiao Ping Zhang
	Xiao PXiao Ping Zhang, Chief Executive Officer

EXHIBIT INDEX

Exhibit No.	Description
99.1	Press release issued on August 13, 2009

EX-99.1

SORL Auto Parts Reports Second Quarter 2009 Financial Results

-- 2Q09 Gross Margin Increased 130 Basis Points YoY to 28.3% --

ZHEJIANG, China, August 13, 2009  -- SORL Auto Parts, Inc. (Nasdaq: SORL) (“SORL” or “The Company”), a leading manufacturer and distributor of commercial vehicle air brake valves as well as related auto parts in China, announced financial results for the quarter ended June 30, 2009.

Prior to the implementation of the China III emission standard beginning on July 1, 2008, demand for commercial vehicles equipped with China II engines was significantly enhanced in the first half of 2008.  This resulted in higher than usual output and sales volume of commercial vehicles in the first and second quarter of 2008, distorting year over year comparisons. SORL provides both year over year and sequential comparisons when discussing its second quarter 2009 financial performance.

For the second quarter of 2009, net sales were $29.7 million, a 29.5% decrease compared to $42.2 million in the same period of 2008 and a 46.9% increase compared to the first quarter of 2009. Revenues from China's domestic OEM market were $14.1 million, a 19.4% decrease from $17.5 million in the same period of 2008 and a 53.3% increase compared to the first quarter of 2009. Revenues from China's domestic aftermarket were $7.2 million, a 31.4% decrease from $10.5 million in the same period of 2008 and a 10.8% increase compared to the first quarter of 2009. Revenues from international markets were $8.4 million a 40.4% decrease from $14.1 million in the same period of 2008 and an 82.6% increase compared to the first quarter of 2009. The year over year decrease in sales was due to a combination of the global financial crisis and macro-economic recession which weakened demand from our Chinese and international customers in 2009 and the implementation of government emissions regulations enacted for the second half of 2008 that spurred higher levels of sales in the first half of 2008.

Gross profit for the second quarter of 2009 was $8.4 million, a 26.2% decrease compared to $11.4 million in the same period of 2008 and a 52.8% increase compared to the first quarter of 2009. Gross margin in the second quarter of 2009 increased 130 basis points to 28.3% from 27.0% in the same period of 2008 and 27.2% in the first quarter of 2009. The increase in gross margin was primarily the result of increasing management efficiency, improving the technologies of products, and SORL’s continued market expansion with new, higher profit valve products.

Operating expenses in the second quarter of 2009 were $4.3 million, a 26.1% decrease compared to $5.9 million in the same period of 2008 and a 4.9% increase compared to the first quarter of 2009. As a percentage of revenue, operating expenses increased to 14.6% in the second quarter 2009 from 13.9% in the same period of 2008 as a result of decreased sales output offset by increased selling, general and administrative expenses. Selling expenses as a percentage of revenue increased as the Company increased packing expenses to improve package quality of some export products. General and administrative expenses as a percentage of revenue increased due to decreased sales without a commensurate decline in certain fixed production costs, such as management payroll, depreciation and professional fees resulting from being a public company. Operating expenses as a percent of revenue decreased from 20.4% in the first quarter of 2009 primarily due to rebounding sales volume.

Operating income in the second quarter of 2009 was $4.1 million, a 26.3% decrease compared to $5.5 million in the same period of 2008 and a 197% increase compared to the first quarter of 2009.  Operating margin increased 60 basis points to 13.7% for the second quarter 2009 from 13.1% in the same period of 2008 as a result of the increase in sales gross margin, offset by the increase in operating expenses as a percent of revenue.  In the second quarter of 2009, operating margin increased 690 basis points from 6.8% in the first quarter of 2009 as a result of stronger sales.

Net income attributable to stockholders for the second quarter of 2009 was $3.0 million or $0.16 per diluted share, a 36.7% decrease compared to $4.7 million, or $0.26 per share in the same period of 2008 and a 217% increase compared to the first quarter of 2009.

“Year over year comparisons in the second quarter of 2009 reflected challenging conditions for SORL,” said Xiaoping Zhang, SORL Auto Parts' CEO and Chairman.  “Sales growth in China and internationally was negatively affected by difficult global economic conditions and year over year comparisons were made more difficult in the first half of 2009 because of government regulations enacted in 2008.  In response to the implementation of the China III emission standard beginning July 1, 2008, sales of trucks equipped with China II engines accelerated in the first half of the year before the policy was enforced.”

Mr. Zhang continued, “Looking at SORL’s financial performance on a sequential basis, we experienced significant improvement. Sales increased 46.9% between the first and second quarter of 2009. Gross profit increased 52.8% between the first and second quarter of 2009 and operating income increased 197%. Net income increased 217% between the first and second quarter of 2009.

“We believe that global economic conditions are showing signs of stabilization and we remain confident in the long-term viability of China’s auto market and SORL’s business plan.  The Chinese government’s stimulus plan has already induced increased demand in the auto market, which we believe will boost our performance in the second half of this year. The stabilizing market is already having a positive impact on our sales, reflected in improved sales performance in the second quarter of 2009 and so far in the third quarter of 2009.

“We continue to invest in research and development to fund exciting new products for these market segments. The financial position of our company remains solid, with $15.8 million of cash on the balance sheet and no long-term debt, and we generated $5.4 million of cash flow from operations during the quarter.”

Conference Call

Management will host a conference call at 8:30 am ET, on Thursday, August 13, 2009 to discuss its second quarter 2009 financial results. Listeners may access the call by dialing #1-888-668-1638 or #1-913-312-1495 for international callers.  A live webcast of the conference call will also be available at http://www.sorl.cn.

A replay of the call will be available from August 13, 2009 to August 20, 2009. Listeners may access the replay by dialing #1-888-203-1112 or #1-719-457-0820 for international callers; pin number: 4220704.

About SORL Auto Parts, Inc.

As China's leading manufacturer and distributor of automotive air brake valves, SORL Auto Parts, Inc. ranks first in market share in the segment for commercial vehicles weighing more than three tons, such as trucks and buses. The Company distributes products both within China and internationally under the SORL trademark. SORL ranks among the top 100 auto component suppliers in China, with a product range that includes 40 types of air brake valves and over 1000 different specifications. The Company has four authorized international sales centers in Australia, United Arab Emirates, India, and the United States, with additional offices slated to open in other locations in the near future. For more information, please visit http://www.sorl.cn.

Safe Harbor Statement

This press release may include certain statements that are not descriptions of historical facts, but are forward-looking statements. Forward- looking statements can be identified by the use of forward-looking terminology such as "will", "believes", "expects" or similar expressions. These forward- looking statements may also include statements about our proposed discussions related to our business or growth strategy, which is subject to change. Such information is based upon expectations of our management that were reasonable when made but may prove to be incorrect. All of such assumptions are inherently subject to uncertainties and contingencies beyond our control and upon assumptions with respect to future business decisions, which are subject to change. We do not undertake to update the forward-looking statements contained in this press release. For a description of the risks and uncertainties that may cause actual results to differ from the forward-looking statements contained in this press release, see our most recent Annual Report filed with the Securities and Exchange Commission (SEC) on Form 10-K, and our subsequent SEC filings. Copies of filings made with the SEC are available through the SEC's electronic data gathering analysis retrieval system (EDGAR) at http://www.sec.gov.

Contact Information

At SORL Auto Parts, Inc.

Ben Chen

Director of Investor Relations

+86 577 6581 7721

Email: ben@sorl.com.cn

At ICR, Inc.:

In U.S.

Brian M. Prenoveau, CFA

+1 203 682 8200

Email: brian.prenoveau@icrinc.com

In China:

Yuening Jiang

+86 10 6599 7965

Email: yuening.jiang@icrinc.com

SORL Auto Parts, Inc. and Subsidiaries

Consolidated Balance Sheets

June 30, 2009 and December 31, 2008

		30-Jun-09		31-Dec-08
		(Unaudited)		(Audited)
Assets
Current Assets
Cash and Cash Equivalents	US$	15,762,830	US$	7,795,987
Accounts Receivable, Net of Provision		40,764,983		35,797,824
Notes Receivable		8,120,653		7,536,534
Inventory		16,246,168		19,105,845
Prepayments, including $0 and $187,813 to related parties at June 30, 2009 and December 31, 2008, respectively.		1,568,450		1,013,440
Other current assets, including $41,042 and $1,906,070 to related parties at June 30, 2009 and December 31, 2008, respectively.		562,310		4,445,778
Total Current Assets		83,025,394		75,695,408
Fixed Assets
Property, Plant and Equipment		33,494,523		32,927,306
Less: Accumulated Depreciation		-10,247,047		-8,951,886
Property, Plant and Equipment, Net		23,247,476		23,975,420
Leasehold Improvements In Progress		465,620		―
Land Use Rights, Net		14,355,711		14,514,983
Other Assets
Deferred compensation cost-stock options		―		9,935
Intangible Assets		161,411		161,347
Less: Accumulated Amortization		-46,692		-39,018
Intangible Assets, Net		114,719		122,329
Deferred tax assets		531,512		189,228
Total Other Assets		646,231		321,492
Total Assets	US$	121,740,432	US$	114,507,303
Liabilities and Shareholders' Equity
Current Liabilities
Accounts Payable and Notes Payable, including $1,570,913 and $0 to related parties at June 30, 2009 and December 31, 2008, respectively.	US$	5,487,114	US$	4,623,850
Deposit Received from Customers		6,435,620		6,295,857
Income tax payable		1,281,330		340,138
Accrued Expenses		3,302,262		2,389,314
Other Current Liabilities		371,389		460,124
Total Current Liabilities		16,877,715		14,109,283
Non-Current Liabilities
Deferred tax liabilities		149,616		106,826
Total Liabilities		17,027,331		14,216,109
Stockholders' Equity
Preferred Stock - No Par Value; 1,000,000 authorized; none issued and outstanding as of June 30, 2009 and December 31, 2008		―		―
Common Stock - $0.002 Par Value; 50,000,000 authorized, 18,279,254 issued and outstanding as of June 30, 2009 and December 31, 2008		36,558		36,558
Additional Paid In Capital		37,498,452		37,498,452
Reserves		3,521,246		3,126,086
Accumulated other comprehensive income		10,885,312		10,848,248
Retained Earnings		42,321,182		38,774,684
Total SORL Auto Parts, Inc. Stockholders' Equity		94,262,750		90,284,028
Noncontrolling Interest In Subsidiaries		10,450,351		10,007,166
Total Equity		104,713,101		100,291,194
Total Liabilities and Stockholders' Equity	US$	121,740,432	US$	114,507,303

SORL Auto Parts, Inc. and Subsidiaries

Consolidated Statements of Income and Comprehensive Income(Unaudited)

For The Three Months and Six Months Ended June 30,2009 and 2008

		Three Months Ended June 30,				Six Months Ended June 30,
		2009		2008		2009		2008
Sales	US$		29,740,212		42,186,119		49,983,950		72,844,561
Include: sales to related parties			64,179		1,004,231		201,611		1,822,149
Cost of Sales			21,318,699		30,776,773		36,049,624		52,793,354
Gross Profit			8,421,513		11,409,346		13,934,326		20,051,207
Expenses:
Selling and Distribution Expenses			2,060,718		2,771,803		3,378,452		4,611,078
General and Administrative Expenses			2,273,064		2,718,217		5,065,813		4,694,418
Financial Expenses			9,129		383,320		38,091		752,996
Total Expenses			4,342,911		5,873,340		8,482,356		10,058,492
Operating Income			4,078,602		5,536,006		5,451,970		9,992,715
Other Income			176,244		222,762		215,461		333,840
Non-Operating Expenses			-11,002		-175,785		-14,616		-254,963
Income (Loss) Before Provision for Income Taxes			4,243,844		5,582,983		5,652,815		10,071,592
Provision for Income Taxes			914,125		318,757		1,272,091		882,231
Net Income	US$		3,329,719		5,264,226		4,380,724		9,189,361
Other Comprehensive Income (Loss)- Foreign Currency Translation Adjustment			60,385		2,110,749		41,183		5,470,639
Total Comprehensive Income			3,390,104		7,374,975		4,421,907		14,660,000
Less:
Net income Attributable to Non-controlling Interest In Subsidiaries			332,972		527,929		439,066		921,948
Other Comprehensive Income (Loss) Attributable to Non-controlling Interest's Share			6,039		211,075		4,119		547,064
Total Comprehensive Income (Loss) Attributable to Non-controlling Interest's Share			339,011		739,004		443,185		1,469,012
Net Income Attributable to Stockholders			2,996,747		4,736,297		3,941,658		8,267,413
Other Comprehensive Income (Loss) Attributable to Stockholders			54,346		1,899,674		37,064		4,923,575
Total Comprehensive Income (Loss) Attributable to Stockholders			3,051,093		6,635,971		3,978,722		13,190,988
Weighted average common share - Basic			18,279,254		18,279,254		18,279,254		18,279,254
Weighted average common share - Diluted			18,279,254		18,287,764		18,279,254		18,288,958
EPS - Basic			0.16		0.26		0.22		0.45
EPS - Diluted			0.16		0.26		0.22		0.45