<PAGE>   1
                                 UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                            Washington, D.C.  20549

                                   FORM 10-Q


(Mark One)
[X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
     EXCHANGE ACT OF 1934

              For the quarterly period ended September 30, 1996

                                     OR

[  ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
     EXCHANGE ACT OF 1934

              For the transition period from              to
                                             ------------    ------------
                       Commission file number 1-13516
                                              -------

                    UNIVERSAL AUTOMOTIVE INDUSTRIES, INC.
           ------------------------------------------------------
           (Exact name of registrant as specified in its charter)


                  Delaware                         36-3973627
     --------------------------------      -------------------------
     (State or other jurisdiction of       (I.R.S. Employer
       incorporation or organization)            Identification No.)


                               3350 North Kedzie
                          Chicago, Illinois 60618-5722
                    ----------------------------------------
                    (Address of principal executive offices)
                                   (Zip Code)

                                 (312) 478-2323
              ----------------------------------------------------
              (Registrant's telephone number, including area code)

                                      N/A
  --------------------------------------------------------------------------
  (Former name, former address and former fiscal year, if changed since last
                                    report)

     Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.  Yes   X    No
                                               -----     -----

               APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
                  PROCEEDINGS DURING THE PRECEDING FIVE YEARS:

     Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Sections 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court.  Yes        No
                           -----     -----

                     APPLICABLE ONLY TO CORPORATE ISSUERS:
The number of shares of issuer's Common Stock, par value $.01 per share,
outstanding as of November 13, 1996 was 6,729,425 shares.

<PAGE>   2
                     UNIVERSAL AUTOMOTIVE INDUSTRIES, INC.

                                     INDEX

PART I.  FINANCIAL INFORMATION                                          Page (s)
                                                                        -------
Item 1.  Financial Statements


         Consolidated Balance Sheets
                September 30, 1996 (Unaudited) and December 31, 1995      3

         Consolidated Statement of Operations
                (Unaudited) - for the three and nine months ended
                September 30, 1996 and 1995                               4

         Consolidated Statement of Cash Flows
                (Unaudited) - for the nine months ended
                September 30, 1996 and 1995                               5

         Notes to Condensed Financial Statements (Unaudited)              6 - 7

Item 2.  Management's Discussion and Analysis of Results of Operations
         and Financial Condition                                          8 - 10




PART II. OTHER INFORMATION

Item 4 - Submission of Matters to a Vote of Security Holders             10


Item 6 - Exhibits and Reports on Form 8-K                                10

         Signatures                                                      11

         Computation of Earnings per Share                               12



                                      2


<PAGE>   3

                     UNIVERSAL AUTOMOTIVE INDUSTRIES, INC.
                          CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>
                                                        September 30, 1996       December 31, 1995
                                                        ------------------       -----------------
                Assets                                     (Unaudited)
<S>                                                         <C>                      <C>
Current Assets:
        Cash & cash equivalents                                 $264,209                $401,117
        Accounts receivable, trade                            13,647,189               8,446,630
        Inventories                                           13,907,443              10,362,510
        Income taxes refundable                                  134,035                 302,313
        Deferred income tax benefit                              328,961                 220,400
        Prepaid expenses and other current assets                805,860                 365,416
                                                             -----------             -----------
                                                              29,087,697              20,098,386
                                                             -----------             -----------
Property and Equipment, net                                    7,999,285               5,254,644
                                                             -----------             -----------

Other Assets:
        Investments                                                    0                  60,316
        Goodwill, net                                            264,494                 284,305
        Other assets                                           1,135,539                 718,184
                                                             -----------             -----------
                                                               1,400,033               1,062,805
                                                             -----------             -----------
                                                             $38,487,015             $26,415,835
                                                             ===========             ===========

                Liabilities and Stockholders' Equity

Current Liabilities:
        Accounts payable, trade                              $11,193,578              $4,850,584
        Long-term indebtedness, current portion                  791,747                 407,079
        Accrued expenses and other current liabilities         1,152,320                 491,488
        Income taxes payable                                     202,870                  22,441
                                                             -----------             -----------
                                                              13,340,515               5,771,592
                                                             -----------             -----------
Long-term Liabilities:
        Revolving loan indebtedness                           10,164,905               9,332,584
        Long-term indebtedness, non-current portion            3,901,167               2,036,866
        Deferred income taxes                                    182,106                 181,818
        Due to stockholders & affiliates                         985,607                 533,988
                                                             -----------             -----------
                                                              15,233,785              12,085,256
                                                             -----------             -----------


Stockholders' Equity:
        Preferred stock (authorized 1,000,000 shares,
          $.01 par value, none issued or outstanding)                  0                       0
        Common stock (authorized 15,000,000 shares,
          $.01 par value, 6,729,425 and 6,500,000 shares
          issued and outstanding, respectively)                   66,911                  65,000
        Additional paid-in-capital                             8,663,732               6,976,204
        Retained earnings                                      2,135,980               1,531,885
        Foreign currency translation adjustments                 (11,408)                (14,102)
        Treasury stock (78,675 shares)                          (942,500)                      0
                                                             -----------             -----------
                                                               9,912,715               8,558,987
                                                             -----------             -----------
                                                             $38,487,015             $26,415,835
                                                             ===========             ===========

</TABLE>

    The accompanying notes are an integral part of the financial statements.


                                       3
<PAGE>   4
                     UNIVERSAL AUTOMOTIVE INDUSTRIES, INC.
                      CONSOLIDATED STATEMENT OF OPERATIONS

                                  (UNAUDITED)

<TABLE>
<CAPTION>
                                                        Three Months Ended September 30,        Nine Months Ended September 30,
                                                        --------------------------------        -------------------------------
                                                               1996             1995                  1996             1995     
                                                        ---------------      -----------        --------------      -----------
<S>                                                         <C>              <C>                   <C>              <C>
Net Sales                                                   $17,625,102      $12,748,483           $50,087,268      $34,267,933

Cost of Sales                                                14,252,888       10,058,166            40,790,691       27,849,342
                                                            -----------      -----------           -----------      -----------

Gross Profit                                                  3,372,214        2,690,317             9,296,577        6,418,591

Selling, General and Administrative Expenses                  2,645,613        2,017,127             7,545,974        5,346,223
                                                            -----------      -----------           -----------      ----------- 
Income from Operations                                          726,601          673,190             1,750,603        1,072,368
                                                            -----------      -----------           -----------      -----------
Other Expense (income):                                 
        Equity in income of subsidiary                                            75,373                  (825)          12,318
        Interest expense                                        311,053          207,648               797,486          545,442
        Loss (gain) on foreign exchange                           2,473                0                (5,694) 
        Other                                                    63,147           24,176                (6,646)
                                                            -----------      -----------           -----------      ----------- 
                                                                376,673          307,197               784,321          557,760
                                                            -----------      -----------           -----------      -----------

Income before Provision for Income Taxes                        349,928          365,993               966,282          514,608

Income Tax Provision:                                           141,650           39,953               362,187           62,245
                                                            -----------      -----------           -----------      -----------
Net Income                                                     $208,278         $326,040              $604,095         $452,363
                                                            ===========      ===========           ===========      ===========
Net Income Per Share                                              $0.03            $0.05                 $0.09            $0.06
                                                            ===========      ===========           ===========      ===========

Weighted average number of common
        shares outstanding                                    7,125,180        7,155,831             7,100,102        7,075,602
                                                            ===========      ===========           ===========      ===========

</TABLE>
    
   The accompanying notes are an integral part of the financial statements.


                                       4
<PAGE>   5

                     UNIVERSAL AUTOMOTIVE INDUSTRIES, INC.
                      CONSOLIDATED STATEMENT OF CASH FLOWS
                                  (UNAUDITED)



<TABLE>
<CAPTION>
                                                                                            Nine Months Ended September 30,
                                                                                         -----------------------------------
                                                                                               1996                1995
                                                                                         --------------        ------------- 
<S>                                                                                      <C>                   <C>
Cash Flows from Operating Activities:
  Net Income                                                                             $   604,095           $    452,363
  Adjustments to reconcile net loss to net cash used in operating activities:
    Depreciation and amortization                                                            604,131                336,171
    Equity in income of subsidiary                                                              (825)                12,318
    Effect of exchange rate changes                                                            2,694                (40,930)
    Compensation expense for stock options                                                    91,008                107,250  
    Deferred income taxes                                                                   (108,273)               (40,755)    
    Changes in operating assets and liabilities:                                                
      Accounts receivable, trade                                                          (5,200,559)               211,702        
      Inventories                                                                         (3,544,933)            (1,474,371)  
      Prepaid expenses and other current assets                                             (140,166)              (230,099)     
      Accounts payable, trade                                                              6,342,994             (2,399,356)
      Accrued expenses and other current liabilities                                         710,031               (381,087)   
                                                                                         -----------            -----------

  Net cash provided by (used in) operating activities                                       (639,803)            (3,446,794)    
                                                                                         -----------            -----------

Cash Flows from Investing Activities:
  Decrease in advances & loans to partially owned entity                                    (141,301)                (9,234)    
  Purchase of property and equipment                                                      (3,282,969)            (1,613,791)       
  Purchase of other assets and goodwill                                                     (463,347)    
                                                                                         -----------            -----------
  Net cash used in investing activities                                                   (3,887,617)            (1,623,025)
                                                                                         -----------            -----------
Cash Flows from Financing Activities:
  Issuance of common stock                                                                   655,986     
  Revolving loan indebtedness                                                                832,321              3,104,601 
  Net principal borrowings (payments) on notes payable                                     2,248,969               (435,609)     
  Net principal borrowings (payments) on loans from stockholders and affiliates              653,236                (78,187)    
                                                                                         -----------            -----------
  Net cash provided by financing activities                                                4,390,512              2,590,805       
                                                                                         -----------            -----------

Net Decrease in Cash and Cash Equivalents                                                   (136,908)            (2,479,014)

Cash and Cash Equivalents, Beginning of Period                                               401,117              2,966,396   
                                                                                         -----------            -----------

Cash and Cash Equivalents, End of Period                                                 $   264,209            $   487,382
                                                                                         ===========            ===========       

</TABLE>



    The accompanying notes are an integral part of the financial statements.


                                       5
<PAGE>   6



                    UNIVERSAL AUTOMOTIVE INDUSTRIES, INC.
                   NOTES TO CONDENSED FINANCIAL STATEMENTS
                                 (UNAUDITED)


1. UNAUDITED INTERIM FINANCIAL STATEMENTS
Interim condensed financial statements are prepared pursuant to the
requirements for reporting on Form 10-Q.
Accordingly, certain disclosures accompanying annual financial statements
prepared in accordance with generally accepted accounting principles are
omitted.

In the opinion of management of Universal Automotive Industries, Inc. (the
"Company"), all adjustments, consisting solely of normal recurring adjustments,
necessary for the fair presentation of the financial statements for these
interim periods have been included. The current periods' results of operations
are not necessarily indicative of results which ultimately may be achieved for
the year.


2. INVENTORIES

                          September 30, 1996
                          ------------------
   Finished goods            $12,366,594
   Work in process               210,000
   Raw materials               1,330,849
                             $13,907,443


3. ACQUISITION
In June 1996, the Company acquired substantially all of the assets of North
American Friction, Inc., a Canadian manufacturer of brake friction parts, for
approximately $1,132,000.  A substantial portion of the acquisition price was
paid for by the Company through the assumption of liabilities.  In connection
with this acquisition, the Company issued 130,000 shares of its common stock to
the seller.

4.  WAREHOUSE DISTRIBUTION BUSINESS
During June, 1996, the Company canceled an agreement that had been entered into
in January, 1996 to sell its Chicago warehouse distribution business because
the potential purchaser of such business could not obtain the necessary
financing. The Company has liquidated the remaining non-brake inventory in the
ordinary course of business.

5. EXERCISE OF UNDERWRITERS' WARRANTS
In connection with the Company's public offering in December 1994, the Company
agreed to sell to the underwriter, warrants to purchase 130,000 units (one
share of common stock and one warrant) at a price of $.001 per unit,
exercisable until December 31, 1999, at an initial per unit exercise price
equal to 145% of the public offering price of $5.00 per unit (or an exercise
price of $7.25). On January 24, 1996, such underwriter warrants for the
purchase of 130,000 units were exercised. Based on the Underwriting Agreement,
the holders of such underwriter warrants elected to exchange shares of the
Company stock (78,675 shares) whose then current market value was equal to the
total required exercise price of $942,500 (130,000 unit at $7.25). Thus, an
additional 51,325 shares of Company stock were issued to the underwriter,
without any cash consideration to the Company.

6. BASIS OF PRESENTATION
Income Taxes
The Company's effective income tax rate in 1995 of 12% varies from the
statutory tax rate principally due to the utilization of loss carry forwards
offsetting the income net of state taxes of one of the Canadian subsidiaries
and a higher income tax rate on the other Canadian subsidiary.

The Company has provided income taxes in 1996 at the statutory tax rate of 38%.





                                       6


<PAGE>   7



                    UNIVERSAL AUTOMOTIVE INDUSTRIES, INC.
                   NOTES TO CONDENSED FINANCIAL STATEMENTS
                                 (UNAUDITED)


6. BASIS OF PRESENTATION - CONTINUED
Net Income Per Share
Net income per share is computed by dividing net income by the weighted average
number of shares of common stock and common stock equivalents outstanding
during the period using the treasury stock method based on the average price of
the stock during the period..

Foreign Currency Translation
During 1996, the Company determined that Hungary qualified as a highly
inflationary economy and therefore changed its method of translating foreign
currency for its Hungarian subsidiary. The financial statements are remeasured
as if the functional currency is the U.S. dollar. The remeasurement of the
local currency into U.S. dollars creates translation adjustments which are
included in net income.

7. LEGAL PROCEEDINGS
During 1995, a lawsuit was filed against the Company in the United States
Bankruptcy Court by the Trustee of a bankrupt entity (the "Debtor") with which
the Company had transacted both purchases and sales of certain automotive parts
in 1992 and 1993. The Trustee is seeking a total of $4,100,000 in damages under
two claims. The largest claim, for approximately $3,700,000 is the result of
alleged "voidable transactions" concerning transfers of product by the Debtor
to the Company without receiving "reasonably equivalent values" (as defined in
the proceedings). The Company believes that all transactions with the Debtor
were conducted in the ordinary course of business and at "reasonably equivalent
values", and thus disclaims any liability under these claims. The Company,
which is in the midst of defending such action, (currently in the discovery
stage) believes that no significant liability will result and has made no
provisions therefor.

Further, the Company has filed a claim of approximately $322,000 against the
Debtor for the amounts owed to it for auto parts sold to the Debtor. Because of
the Debtor's bankruptcy, no receivable is reflected for such amount.

8. ISSUANCE OF STOCK
During June, 1996, the Company issued shares of its common stock in connection
with the following: 
a. 39,500 shares of stock were issued to a company in Dallas, Texas from which
the Company acquired inventory and a customer list in June, 1995.  The shares
were issued in consideration of the termination of the cash component of a
consulting agreement and covenants not to compete, both expiring in October,
1998, entered into with the principals of the selling company.  At the date the
shares were issued, an amount of $342,200 remained unpaid under such agreements,
which amount will be charged to expense at the rate of $11,800 per month.  
b: 7,200 shares issued to certain individuals in connection with the
acquisition of the inventory and customer list of an aftermarket distributor
located in Massachusetts.
        

                                      7


<PAGE>   8



               MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS
                    OF OPERATION AND FINANCIAL CONDITION


RESULTS OF OPERATIONS

Three Months Ended September 30, 1996 Compared To Three Months Ended September
30, 1995

     Net sales for the three months ended September 30, 1996 increased by
$4,876,619 or 38% to $17,625,102. Such increase was due primarily to a 61%
increase in sales in the Company's UBP brake parts business. The overall
increase was achieved despite a 59% sales decrease in the Company's Chicago
warehouse distribution business. The Company has liquidated the lower margin
non-brake product lines in this business.  The Company now maintains 2,500
stock keeping units, all brake parts, in the Chicago  warehouse down from
40,000 stock keeping units prior to the liquidation.  The Company continues to
service its existing Chicago area jobber customers with higher margin brake
parts.   Also contributing to the third quarter sales increase were $1,037,162
in sales from UPB Hungary, Inc., a wholly owned subsidiary comprising the
Company's Hungarian foundry operations, which was acquired in October, 1995,
and a modest improvement in sales of commodity type auto parts sold by the
Company on a drop ship basis.

     Gross profits for the three months ended September 30, 1996 were 19.1% of
net sales compared to 21.1% in the same period of 1995. Such decrease in gross
profit as a percentage of net sales was due primarily to a loss in the
Company's Hungarian foundry due to decreased volumes as a result of an annual
two week maintenance shutdown and customer resistance to price increases.

     Selling, general and administrative expenses for the three months ended
September 30, 1996 increased by  $628,486 or 31% from $2,017,127 for the same
period in 1995 and as a percentage to sales 15.0% compared to 15.8% for the
same period in 1995.  The increase in these expenses was due primarily to: (i)
an increase in selling and distribution expenses of a mostly variable nature
related to the 61% increase in sales in the Company's UBP brake parts business,
and (ii) expenses incurred by UBP Hungary, which was acquired in October, 1995.

     Net income for the three months ended September 30, 1996 was $208,278
compared to a net income of $326,040 for the same period in 1995. This overall
decrease in net income is attributed to increased sales of  higher gross margin
brake parts offset by (ii) net loss for the Company's Hungarian foundry
business, (ii) decreased sales due to the liquidation of the non-brake product
lines, (iii) increased interest costs due to higher debt levels, and (iv)
higher provision for income taxes due to lack of tax loss carryforward that was
used in 1995.

     Six Months Ended September 30, 1996 Compared To Nine Months Ended
September 30, 1995

     Net sales for the nine months ended September 30, 1996 increased by
$15,819,335 or 46% to $50,087,268. Such increase was due primarily to a 59%
increase in sales in the Company's UBP brake parts business. The overall
increase was achieved despite a 40% sales decrease in the Company's Chicago
warehouse distribution business. The Company has liquidated the lower margin
non-brake product lines in this business.  The Company now maintains 2,500
stock keeping units, all brake parts, in the Chicago warehouse down from 40,000
stock keeping units prior to the liquidation.  The Company continues to service
its existing Chicago area jobber customers with higher margin brake parts. Also
contributing to this increase in nine months sales were $4,612,722 in sales
from the Company's Hungarian foundry operations, which was acquired in October,
1995, and improved sales of commodity type auto parts sold by the Company on a
drop ship basis.





                                      8


<PAGE>   9



        MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATION
                           AND FINANCIAL CONDITION


RESULTS OF OPERATIONS - CONTINUED

     Gross profits for the nine months ended September 30, 1996 were 18.6% of
net sales compared to 18.7% in the same period of 1995. Such overall decrease
in gross profit as a percentage of net sales was due primarily to increased
sales of higher gross profit margin brake parts offset by lower gross profit
percentage at the Company's Hungarian foundry.

     Selling, general and administrative expenses for the nine months ended
September 30, 1996 increased by  $2,199,751 or 41% to $7,545,974 from
$5,346,223 for the same period in 1995. Such increase was due primarily to: (i)
an increase in selling and distribution expenses of a mostly variable nature
related to the 59% increase in sales in the Company's UBP brake parts business,
(ii) expenses incurred by UBP Hungary, which was acquired in October, 1995,
(iii) an increase in legal fees incurred by the Company in connection with
defending the lawsuit filed against the Company in the US Bankruptcy Court (see
Note 7 to Condensed Financial Statements), and (iv) start up costs to move the
rotor manufacturing operation from Canada to Laredo, Texas.

     Net income for the nine months ended September 30, 1996 was $604,095
compared to a net income of $452,363 for the same period in 1995. This overall
increase in net income is attributed to the following: (i) increased sales of
higher gross profit margin brake parts, (ii) improved sales of commodity type
auto parts, offset by (iii) loss for the Company's Hungarian foundry, (iv)
increased interest costs due to higher debt levels, and (v) higher provision
for income taxes due to lack of tax loss carryforward that was used in 1995.

Management believes that the net income from operations for the nine months
ended September 30, 1996 would have been approximately $420,000 higher if not
for the following one time charges:

                             Non-recurring costs
                    for nine months ended September, 1996


Loss attributable to restructuring of the Company's Chicago
warehouse distribution division                                     $110,000
Start up, down-time and moving costs of brake rotor manufacturing
operation                                                            145,000
Loss attributable to UBP Hungary - primarily as a result of
disruptions caused by the renovations and improvement projects        60,000 
Legal fees related to the U. S. Bankruptcy Court lawsuit             105,000
                                                                    $420,000

LIQUIDITY AND CAPITAL RESOURCES

     Net cash used in operating activities for the nine months ended September
30, 1996 was $639,803. This was due primarily to increases in accounts
receivable and inventories of approximately $5,200,000 and $3,500,000,
respectively which was offset by an increase in accounts payable resulting from
extended vendor payment terms.  Increased accounts receivable and inventories
resulted from increased sales.

     Net cash used in investing activities was $3,887,617, which is
attributable primarily to the acquisition in January, 1996 of the remaining 50%
of UBP Friction, Inc., and other brake friction equipment, renovation and
improvements at the Hungarian foundry and the acquisition of additional rotor
manufacturing equipment.

     Net cash provided from financing activities was $4,390,512, consisting
primarily of long-term bank financing provided for the Hungarian foundry and
the rotor manufacturing operation.

                                      9


<PAGE>   10



                MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS
                      OF OPERATION AND FINANCIAL CONDITION


LIQUIDITY AND CAPITAL RESOURCES - CONTINUED

     The Company expects to continue to finance its operations through cash
flow from operating activities.  The Company anticipates that it will need
additional funds to finance continued growth.  The  Company is negotiating with
several investment sources to secure additional debt and/or equity financing.
However, the Company cannot offer any assurances that it will be successful in
securing such additional financing.

PART II  OTHER INFORMATION


Item 4 - Submission of Matters to a Vote of Security Holders
On June 12, 1996, Universal Automotive Industries, Inc. held its annual
stockholders meeting.  Present at this meeting, in person and by proxy, were
stockholders representing 5,453,096 of the 6,551,325 issued and outstanding
shares of Common Stock (83.24% of the total number of shares of Common Stock
outstanding and entitled to vote).  The following items were voted upon at the
meeting:

a) The following Directors were elected to the Board:


Name                        Votes For  Votes Against  Abstentions

Arvin Scott                 5,439,446     13,650           0
Yehuda Tzur                 5,439,446     13,650           0
Sami Israel                 5,439,446     13,650           0
Eric Goodman                5,439,446     13,650           0
Sheldon Robinson            5,439,446     13,650           0
Sol S. Weiner               5,439,446     13,650           0


b) The firm of Altschuler, Melvoin and Glasser LLP was re-appointed as the
Company's independent auditors for 1996.  Holders of Common Stock holding
5,422,996 votes were cast in favor, 14,600 votes were cast against and no
shares abstained from voting.

Item 6 - Exhibits and Reports on Form 8-K

a) Exhibit 11 - Computation of Earnings Per Share

b) A report on Form 8-K was filed on June 6, 1996 wherein information was
disclosed under Item 5.



                                      10

<PAGE>   11


                                 SIGNATURES

     Pursuant to the requirements of Section 13 or 15(d) of the Securities and
Exchange Act of 1934, the Company has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.


                             UNIVERSAL AUTOMOTIVE INDUSTRIES, INC.



                             /s/ ARVIN SCOTT
                             --------------------------------------------------
                             Arvin Scott, Chief Executive Officer & President
                             (Principal Executive Officer)



                             /s/ JEROME J. HISS
                             --------------------------------------------------
                             Jerome J. Hiss, Chief Financial Officer (Principal
                             Financial Officer and Principal Accounting Officer)



Date: November 13, 1996


                                      
                                      11

<PAGE>   12
EXHIBIT 11


                     UNIVERSAL AUTOMOTIVE INDUSTRIES, INC.
                       COMPUTATION OF EARNINGS PER SHARE

<TABLE>
<CAPTION>

                                                  Three Months Ended September 30,                Nine Months Ended September 30,
                                                  --------------------------------                -------------------------------
                                                   1996                    1995                    1996                    1995
                                                ----------              ----------              ----------              ----------
<S>                                             <C>                     <C>                     <C>                     <C>
PRIMARY NET INCOME PER COMMON SHARE

Net Income                                      $  208,278              $  326,040              $  604,095              $  452,363
                                                ==========              ==========              ==========              ==========
Weighted average Common Shares outstanding       6,729,197               6,500,000               6,620,587               6,500,000
Warrants assumed to be Common Stock 
  equivalents using Treasury Stock Method          395,983                 655,831                 479,515                 575,602
                                                ----------              ----------              ----------              ----------
Weighted average Common Shares outstanding,
  as adjusted                                    7,125,180               7,155,831               7,100,102               7,075,602
                                                ==========              ==========              ==========              ==========
Primary Net Income per Common Share                  $0.03                   $0.05                   $0.09                   $0.06
                                                ==========              ==========              ==========              ==========



FULLY DILUTED NET INCOME PER COMMON SHARE

Net Income                                      $  208,278              $  326,040              $  604,095              $  452,363
                                                ==========              ==========              ==========              ==========
Weighted average Common Shares outstanding       6,729,197               6,500,000               6,620,587               6,500,000
Warrants assumed to be Common Stock 
  equivalents using Treasury Stock Method          395,983                 704,468                 479,515                 704,468
                                                ----------              ----------              ----------              ----------
Weighted average Common Shares outstanding,
  as adjusted                                    7,125,180               7,204,468               7,100,102               7,204,468
                                                ==========              ==========              ==========              ==========
Primary Net Income per Common Share                  $0.03                   $0.05                   $0.09                   $0.06
                                                ==========              ==========              ==========              ==========

</TABLE>



                                       12