================================================================================

                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-QSB

(Mark One)

[X]         QUARTERLY REPORT UNDER TO SECTION 13 OR 15(d) OF THE SECURITIES
            EXCHANGE ACT OF 1934
                For the Quarterly Period Ended September 30, 2002


[_]         TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
            EXCHANGE ACT OF 1934
             For the Transition Period from _________ to __________

                           Commission File No. 1-12559

                             CRAGAR INDUSTRIES, INC.
                 (Name of small business issuer in its charter)

                DELAWARE                               86-0721001
      (State or other jurisdiction         (I.R.S. Employer Identification No.)
    of incorporation or organization)


                 4620 EAST ARCADIA LANE, PHOENIX, ARIZONA 85018
              (Address of principal executive offices and zip code)

                                 (480) 596-6483
                           (Issuer's telephone number)

         Securities Registered Under Section 12(b) of the Exchange Act:

                                      None

         Securities Registered Under Section 12(g) of the Exchange Act:

                          COMMON STOCK, $.01 PAR VALUE
                         COMMON STOCK PURCHASE WARRANTS

            Check whether the issuer (1) filed all reports required to be filed
by Section 13 or 15(d) of the Exchange Act during the past 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 [_]

            Number of shares of common stock, $.01 par value, outstanding as of
September 30, 2002: 3,897,611.

            Transitional small business disclosure format. Yes [_] No [X]

================================================================================
<PAGE>

                             CRAGAR INDUSTRIES, INC.
                            Condensed Balance Sheets
                    September 30, 2002 and December 31, 2001
<TABLE>
<CAPTION>
                                                                                            September 30,        December 31,
                                                                                                2002                 2001
                                                                                            ------------         ------------
                                                                                             (unaudited)
<S>                                                                                         <C>                  <C>
                                     ASSETS

Current Assets
         Cash and cash equivalents                                                          $     64,504         $     33,216
         Non-trade receivables                                                                   263,031              132,233
         Investments                                                                              78,489               78,489
         Prepaid expenses                                                                        100,583              240,000
                                                                                            ------------         ------------
                 Total current assets                                                            506,607              483,938

Other Assets                                                                                        --                 30,000
                                                                                            ------------         ------------

Total Assets                                                                                $    506,607         $    513,938
                                                                                            ============         ============

                      LIABILITIES AND STOCKHOLDERS' DEFICIT

Current Liabilities
         Accounts payable                                                                   $    390,220         $    491,808
         Line of credit                                                                        1,265,500            1,305,500
         Accrued interest                                                                          9,737                7,999
         Accrued expenses                                                                         39,713              192,692
                                                                                            ------------         ------------
                 Total current liabilities                                                     1,705,170            1,997,999
                                                                                            ------------         ------------


Stockholders' Deficit
         Preferred stock, par value $ .01; authorized 200,000 shares
                 none issued and outstanding                                                        --                   --
         Common stock, par value $ .01; authorized 10,000,000 shares
                 3,897,611 and 3,897,611 shares respectively  issued and outstanding              38,976               38,976
         Additional paid-in capital - common                                                  15,679,177           15,679,177
         Accumulated deficit                                                                 (16,916,716)         (17,202,214)
                                                                                            ------------         ------------
                 Total stockholders' deficit                                                  (1,198,563)          (1,484,061)
                                                                                            ------------         ------------

Total Liabilities and Stockholders' Deficit                                                 $    506,607         $    513,938
                                                                                            ============         ============
</TABLE>
See accompanying notes to condensed financial statements

                                        2
<PAGE>

                             CRAGAR INDUSTRIES, INC.
                       Condensed Statements of Operations
         Three Months and Nine Months Ended September 30, 2002 and 2001
                                   (unaudited)
<TABLE><CAPTION>
                                                                   Three Months Ended                   Nine Months Ended
                                                                      September 30,                        September 30,
                                                             ------------------------------        ------------------------------
                                                                 2002               2001               2002               2001
                                                             -----------        -----------        -----------        -----------
<S>                                                          <C>                <C>                <C>                <C>
Net Sales                                                    $      --          $     6,000        $      --          $     6,000
Royalty revenues                                                 113,416             92,560            431,429            338,939
                                                             -----------        -----------        -----------        -----------
                 Total revenues                                  113,416             98,560            431,429            344,939

Cost of goods sold                                                  --                 --                 --                 --
                                                             -----------        -----------        -----------        -----------

                 Gross profit                                    113,416             98,560            431,429            344,939

Selling, general and administrative expenses                     168,624            166,512            510,519            346,109
                                                             -----------        -----------        -----------        -----------


                 Income (loss) from operations                   (55,208)           (67,952)           (79,090)            (1,170)
                                                             -----------        -----------        -----------        -----------

Non-operating income (expenses), net
         Interest expense                                        (29,545)           (64,664)           (97,093)          (139,488)
         Litigation settlement                                      --                 --              300,000               --
         Other                                                    29,592             20,504             68,701            108,031
                                                             -----------        -----------        -----------        -----------
                 Total non-operating income (expenses), net           47            (44,160)           271,608            (31,457)
                                                             -----------        -----------        -----------        -----------

Net earnings (loss) before income taxes and
         extraordinary item                                      (55,161)          (112,112)           192,518            (32,627)

Income taxes                                                        --                 --                 --                 --
                                                             -----------        -----------        -----------        -----------

Net earnings (loss) before extraordinary item                    (55,161)          (112,112)           192,518            (32,627)

Forgiveness of debt                                               92,980               --               92,980               --
                                                             -----------        -----------        -----------        -----------

Net earnings (loss)                                          $    37,819        $  (112,112)       $   285,498        $   (32,627)
                                                             ===========        ===========        ===========        ===========

Basic earnings per share
         Net earnings (loss) before extraordinary item       $     (0.02)       $     (0.03)       $      0.05        $     (0.01)
         Extraordinary item                                         0.03               --                 0.03               --
                                                             -----------        -----------        -----------        -----------
         Net earnings (loss)                                 $      0.01        $     (0.03)       $      0.07        $     (0.01)
                                                             ===========        ===========        ===========        ===========


Weighted average shares outstanding                            3,897,611          3,695,868          3,897,611          3,627,236
                                                             ===========        ===========        ===========        ===========

Diluted earnings per share
         Net earnings (loss) before extraordinary item       $     (0.02)       $     (0.03)       $      0.05        $     (0.01)
         Extraordinary item                                         0.03               --                 0.03               --
                                                             -----------        -----------        -----------        -----------
         Net earnings                                        $      0.01        $     (0.03)       $      0.07        $     (0.01)
                                                             ===========        ===========        ===========        ===========


Weighted average shares outstanding                            3,981,611          3,695,868          3,981,611          3,627,236
                                                             ===========        ===========        ===========        ===========
</TABLE>
See accompanying notes to condensed financial statements

                                        3
<PAGE>

                             CRAGAR INDUSTRIES, INC.
                       Condensed Statements of Cash Flows
                  Nine Months Ended September 30, 2002 and 2001
                                   (unaudited)

<TABLE><CAPTION>
                                                                                         Nine Months Ended
                                                                                           September 30,
                                                                                    ---------------------------
                                                                                       2002              2001
                                                                                    ---------         ---------
<S>                                                                                 <C>               <C>
Cash flows from operating activities
         Net earnings                                                               $ 285,498         $ (32,627)
         Adjustments to reconcile net earnings to net cash
                 provided by (used in) operating activities:
                 Warrants issued for financing costs                                     --              31,920
         Increase (decrease) in cash resulting from changes in:
                 Accounts receivable                                                     --             294,641
                 Non-trade receivables                                               (130,798)           25,124
                 Prepaid expenses                                                     139,417          (127,844)
                 Other assets                                                          30,000            21,320
                 Accounts payable and accrued expenses                               (254,567)         (315,682)
                 Accrued interest                                                       1,738               761
                                                                                    ---------         ---------
                         Net cash provided by (used in) operating activities           71,288          (102,387)
                                                                                    ---------         ---------

Cash flows from investing activities
         Dispositions of property and equipment                                          --              41,926
                                                                                    ---------         ---------
                         Net cash provided by (used in) investing activities             --              41,926
                                                                                    ---------         ---------

Cash flows from financing activities
         Payments on line of credit                                                   (40,000)             --
         Issuance of common stock                                                        --             128,982
                                                                                    ---------         ---------
                         Net cash provided by (used in) financing activities          (40,000)          128,982
                                                                                    ---------         ---------

                         Net increase  in cash and cash equivalents                    31,288            68,521

Cash and cash equivalents at beginning of period                                       33,216            68,300
                                                                                    ---------         ---------

Cash and cash equivalents at end of period                                          $  64,504         $ 136,821
                                                                                    =========         =========


Supplemental disclosure of cash flow information:
         Cash paid for interest                                                     $  95,355         $ 138,727
                                                                                    =========         =========

Non-cash financing and investing activities:
         Issuance of common stock for license fee                                   $    --           $ 120,000
                                                                                    =========         =========

         Issuance of warrants for financing fees                                    $    --           $  31,920
                                                                                    =========         =========
</TABLE>
See accompanying notes to condensed financial statements

                                        4
<PAGE>

                             CRAGAR INDUSTRIES, INC.
                     NOTES TO CONDENSED FINANCIAL STATEMENTS
                      NINE MONTHS ENDED SEPTEMBER 30, 2002
                                   (Unaudited)

1.      Summary of Significant Accounting Policies Basis of Presentation:

        The interim financial data as of and for the nine months ended September
        30, 2002, and 2001 is unaudited; however, in the opinion of the Company,
        the interim data includes all adjustments, consisting only of normal
        recurring adjustments, necessary for a fair presentation of the results
        for the interim periods.

        The year-end balance sheet information was derived from audited
        financial statements. These interim financial statements should be read
        in conjunction with the Company's audited financial statements.

2.      Basic and Diluted Earnings (Loss) per Share

        Basic and diluted earnings (loss) per share amounts are based on the
        weighted average number of common shares and common stock equivalents
        outstanding as reflected on Exhibit 11 to this Quarterly Report on Form
        10-QSB. No outstanding options or warrants were assumed to be exercised
        for purposes of calculating diluted earnings per share for the three
        month and nine month periods ended September 30, 2001, as their effect
        would be anti-dilutive. Outstanding options and warrants were assumed to
        be exercised for purposes of calculating diluted earnings per share for
        the three month and nine month periods ended September 30, 2002.

3.      The accompanying financial statements are prepared using accounting
        principles generally accepted in the United States of America which
        contemplates continuation of the Company as a going concern. However,
        the Company has negative working capital and negative equity as of the
        balance sheet date.

        The above conditions indicate that the company may be unable to continue
        in existence. The financial statements do not include any adjustments
        relating to the recoverability and classification of recorded asset
        amounts, or the amounts and classification of liabilities that might be
        necessary should the Company be unable to continue in existence.

ITEM 2.     MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

FORWARD-LOOKING STATEMENTS

        This report contains forward-looking statements. Additional written or
oral forward-looking statements may be made by the Company from time to time in
filings with the Securities and Exchange Commission or otherwise. Such
forward-looking statements are within the meaning of that term in Section 27A of
the Securities Act of 1933, as amended, and Section 21E of the Securities
Exchange Act of 1934, as amended. Such statements may include, but not be
limited to, projections of revenues, income or loss, estimates of capital
expenditures, plans for future operations, products or services, and financing
needs or plans, as well as assumptions

                                       5
<PAGE>

relating to the foregoing. The words "believe," "expect," "anticipate,"
"estimate," "project," and similar expressions identify forward-looking
statements, which speak only as of the date the statement was made.
Forward-looking statements are inherently subject to risks and uncertainties,
some of which cannot be predicted or quantified. Future events and actual
results could differ materially from those set forth in, contemplated by, or
underlying the forward-looking statements. The following disclosures, as well as
other statements in the Company's report, including those contained below in
this Item 2, "Results of Operations" and "Special Considerations," describe
factors, among others, that could contribute to or cause such differences.
Specifically, management is uncertain whether the anticipated cash flow from
operations will be sufficient to meet the Company's anticipated operations and
working capital needs. Therefore, the Company might seek to secure additional
working capital through the sale of equity or debt securities. In addition, no
assurance can be given regarding the Company's ability to obtain such financing
on favorable terms, if at all. Should the Company require additional financing
and be unable to obtain additional financing, its ability to meet its
anticipated operating and working capital needs will be materially and adversely
affected. As a result of the Company's stockholders' deficit and the uncertainty
surrounding the Company's ability to meet its anticipated operating and working
capital needs, the independent auditors' report on the Company's 2001 financial
statements has been qualified for a going concern.

                                  INTRODUCTION

        From our inception in December 1992 through the first nine months of
fiscal year 1999, we designed, produced, and sold high-quality custom vehicle
wheels and wheel accessories. We sold our wheel products in the automotive
aftermarket through a national distribution network of value-added resellers,
including tire and automotive performance warehouse distributors and retailers
and mail order companies. During the fourth quarter of fiscal year 1999, we
began our transformation into a licensing and trademark company. This process
was concluded during the fiscal year ended December 31, 2000.

        In connection with a reassessment of our business strategy, we
considered combinations and strategic alliances with other companies that could
complement our existing business, including outsourcing our manufacturing and
sales operations. Accordingly, in September 1999, we entered into an Exclusive
Field of Use License Agreement and an Agreement of Purchase and Sale of Assets
with Weld Racing, Inc. Under this agreement, Weld will manufacture, sell, and
distribute our line of wheels with non-cast wrought aluminum alloy outer rims
and related accessories and we will receive a royalty based on sales of the
licensed products. We also sold certain assets to Weld related to our wrought
wheel business. We completed this transaction in October 1999. During the fourth
quarter of fiscal year 2001, we amended our agreement with Weld. Pursuant to the
amendment, we modified the product classes that Weld held rights to.

        In October 1999, we entered into a similar transaction with Carlisle
Tire and Wheel Co., pursuant to which we granted an exclusive worldwide license
to Carlisle. Under this agreement, Carlisle will manufacture, sell, and
distribute our line of wheels with steel outer rims and related accessories and
we will receive a royalty based on sales of the licensed products. We also sold
certain assets to Carlisle related to our steel outer rim wheel business. We
completed this transaction with Carlisle in December 1999.

        In September 2000, we entered into and completed a similar transaction
with Performance Wheel Outlet, Inc. Under this agreement, Performance will
manufacture, sell, and distribute our line of one-piece cast aluminum wheels and
we will receive a royalty based on sales of the licensed products. During the
fourth quarter of fiscal year 2001, we amended our

                                       6
<PAGE>

agreement with Performance to offer certain incentives for Performance to expand
its product offerings.

        As a consequence of the transactions with Performance, Weld, and
Carlisle, we no longer engage in the manufacture, marketing, sale, or
distribution of any products related to our one-piece wheel business, wrought
wheel business, and steel outer rims wheel business, which together generated
practically all of our revenue in the fiscal year ended December 31, 1999. In
general, the outsourcing of the manufacturing, marketing, sales, and
distribution operations with respect to the licensed products, together with the
sale of all the related assets, has substantially decreased our revenue and
related operating and marketing costs.

        We intend to rely on Performance's, Weld's, and Carlisle's greater
financial, operational, and distribution capabilities to increase net sales of
the licensed products and generate a stream of increasing revenue in the form of
quarterly royalty payments. In addition, we are entitled to royalties based on
the net sales of any new products developed by Carlisle related to the steel
outer rims wheel business under the CRAGAR brand name, including products and
related accessories for vehicles other than automobiles, trucks, and vans, such
as all-terrain vehicles and golf carts. We are also entitled to receive
royalties based on net sales of any new products developed by Weld related to
the wrought wheel business under the CRAGAR brand name, including two-piece
aluminum wheels and new types of race wheels. Because our licensing partners'
primary fiduciary obligation is to their stockholders rather than our
stockholders, they may make decisions or take steps that may result in lower
royalty payments or that could adversely affect the CRAGAR brand name.

        As part of our new business strategy, we also intend to pursue licensing
opportunities through the utilization of the CRAGAR brand name for other
products, including, but not limited to, aftermarket performance automotive
products. On April 1, 2001, we retained the services of Trademarketing
Resources, Inc., or TRI. TRI will act as our exclusive licensing agent for the
purposes of exercising the merchandising rights in and to the trademarks owned
by us, including CRAGAR, CRAGAR Lite, Keystone Klassic, S/S, Street Pro, Star
Wire, CRAGAR XLS, TRU=CRUISER, and TRU=SPOKE, and implementing, subject to our
approval, a marketing strategy to broaden the use of our intellectual property,
including the CRAGAR brand name. TRI will also oversee and coordinate the
licensing activities of Carlisle, Weld, and Performance. As part of the
agreement with TRI, we issued 58,182 shares of our common stock to certain
individuals who will be providing us services directly under the agreement. They
received an additional 58,182 shares of our common stock on April 2, 2002. There
can be no assurance that we will be successful developing or implementing such a
marketing strategy or that we will generate any material sales of products
utilizing our intellectual property. In addition, TRI will act as our exclusive
agent with respect to coordinating advertising and promotion of all of our
products, services, and premiums across all media.

        During the fourth quarter of fiscal year 2001, we entered into a
licensing agreement with Racing Champions Ertl, Inc. pursuant to which we
granted an exclusive license in specified geographic territories for the
manufacture, marketing, and sale of 1:18th scale die cast replicas, 1:18th scale
die cast model kits, and 1:25th scale plastic model kits. During the fourth
quarter of fiscal year 2001, we also entered into a licensing agreement with
Playing Mantis, Inc. pursuant to which we granted an exclusive license in
specified geographic territories for the manufacture, marketing and sale of
1:64th scale die cast replicas and 1:64th scale die cast model kits.

        During the quarter ended September 30, 2002, we directed our financial
advisor, Miller Capital Corporation, to explore and evaluate strategic
alternatives and business opportunities.

                                       7
<PAGE>

This includes, among other alternatives, strategic business combinations, the
sale of the CRAGAR brand and related royalty streams or the possible sale of the
Company.

RESULTS OF OPERATIONS

        The following table sets forth various items as a percentage of total
revenue for the three and nine month periods ended September 30, 2002 and 2001:

<TABLE><CAPTION>
                                                 THREE MONTHS ENDED SEPTEMBER 30,   NINE MONTHS ENDED SEPTEMBER 30,
                                                 --------------------------------   -------------------------------
                                                      2002           2001                2002           2001
                                                    --------       --------            --------       --------
<S>                                                    <C>            <C>                 <C>            <C>
       Total revenue                                   100.0 %        100.0 %             100.0 %        100.0 %
       Cost of goods sold                                --             --                  --             --
                                                    --------       --------            --------       --------
       Gross profit                                    100.0          100.0               100.0          100.0
       SG&A                                            148.7          168.9               118.3          100.3
                                                    --------       --------            --------       --------
       Income (loss) from operations                   (48.7)         (68.9)              (18.3)          (0.3)
       Non-operating income (expense), net               --           (44.8)               62.9           (9.1)
       Income taxes                                      --             --                  --             --
       Extraordinary gain                               82.0            --                 21.6            --
                                                    --------       --------            --------       --------
       Net earnings (loss)                              33.3%        (113.7)%              66.2%          (9.4)%
                                                    ========       ========            ========       ========
</TABLE>

COMPARISON OF QUARTER ENDED SEPTEMBER 30, 2002 AND QUARTER ENDED SEPTEMBER 30,
2001

        TOTAL REVENUE. Total revenue consists of royalties on the sale of
licensed products. Total revenue for the fiscal quarters ended September 30,
2002 and 2001, was $113,416 and $98,560, respectively, representing a 15.1%
increase in total revenue. The increase was due to increased combined sales by
Cragar's licensing partners resulting in higher royalties.

        GROSS PROFIT. Gross profit is determined by subtracting cost of goods
sold from total revenue. Historically, cost of goods sold consisted primarily of
the costs of labor, aluminum, steel, raw materials, overhead, and material
processing used in the production of our products, as well as the freight costs
of shipping product to our customers. Currently, we do not realize any cost of
goods sold, since our total revenue is derived from royalties. Gross profit for
the fiscal quarter ended September 30, 2002 was $113,416 compared to $98,560 for
the fiscal quarter ended September 30, 2001.

        SELLING, GENERAL, AND ADMINISTRATIVE EXPENSES. Selling, general, and
administrative expenses consist primarily of accounting and legal expenses,
office expenses, salaries and wages, marketing expenses, and general overhead.
These expenses for the fiscal quarter ended September 30, 2002 were $168,624
compared to $166,512 for the quarter ended September 30, 2001, a 1.3% increase.
The increase was due primarily to increases in professional and consulting fees
associated with our evaluation of potential strategic business alliances and
opportunities, in addition to the potential opportunities to expand the use of
our brand names.

        NON-OPERATING INCOME, NET. Non-operating income, net, for the fiscal
quarter ended September 30, 2002 was $47 compared to non-operating expenses,
net, of $44,160 for the same fiscal quarter ended September 30, 2001.

        EXTRAORDINARY GAIN. Extraordinary gain for the quarter ended September
30, 2002 was primarily the result of the foregiveness of debt associated with
amounts owed on the legal fees attributable to our lawsuits against Titan
International, which as of March 18, 2002 had been settled.

                                       8
<PAGE>

        INCOME TAXES. Because of carry-forward losses from previous years, the
Company had no income tax provision in the third fiscal quarter of 2002 or 2001.

        NET EARNINGS (LOSS) PER SHARE. Net earnings for the fiscal quarter ended
September 30, 2002 were $37,819 compared to net loss of $112,112 for the fiscal
quarter ended September 30, 2001. Basic earnings per share for the fiscal
quarter ended September 30, 2002 was $0.01 compared to a basic loss per share of
$0.03 for the fiscal quarter ended September 30, 2001. Diluted earnings per
share for the fiscal quarter ended September 30, 2002 was $0.01 compared to a
basic loss per share of $0.03 for the fiscal quarter ended September 30, 2001.
See Exhibit 11 to this Quarterly Report on Form 10-QSB.

COMPARISON OF NINE MONTHS ENDED SEPTEMBER 30, 2002 AND NINE MONTHS ENDED
SEPTEMBER 30, 2001

        TOTAL REVENUE. Total revenue for the nine months ended September 30,
2002 and 2001, was $431,429 and $344,939, respectively, representing a 25.1%
increase in total revenue. The increase was due to increased combined sales by
Cragar's licensing partners resulting in higher royalties. Approximately $33,000
of royalties earned in the nine months ended September 30, 2002 were the result
of licensed products sold during 2000 and 2001.

        GROSS PROFIT. Gross profit is determined by subtracting cost of goods
sold from total revenue. Historically, cost of goods sold consisted primarily of
the costs of labor, aluminum, steel, raw materials, overhead, and material
processing used in the production of our products, as well as the freight costs
of shipping product to our customers. Currently, we do not realize any cost of
goods sold, since our total revenue is derived from royalties. Gross profit for
the nine months ended September 30, 2002 was $431,429 compared to $344,939 for
the nine months ended September 30, 2001.

        SELLING, GENERAL, AND ADMINISTRATIVE EXPENSES. Selling, general, and
administrative expenses consist primarily of accounting and legal expenses,
office expenses, salaries and wages, marketing expenses, and general overhead.
These expenses for the nine months ended September 30, 2002 were $510,519
compared to $346,109 for the nine months ended September 30, 2001, a 47.5%
increase. This increase was due primarily to increases in professional and
consulting fees associated with our evaluation of potential strategic business
alliances and opportunities, in addition to the potential opportunities to
expand the use of our brand names. For the nine months ended September 30, 2002
we incurred $12,275 in legal fees attributable to our lawsuits against Titan
International, which as of March 18, 2002 had been settled.

        NON-OPERATING INCOME, NET. Non-operating income, net, for the nine
months ended September 30, 2002 was $271,608 compared to non-operating expense,
net of $31,457 for the same nine month period ended September 30, 2001. This
increase of $275,065, was attributable primarily to the settlement of the Titan
International Lawsuit.

        EXTRAORDINARY GAIN. Extraordinary gain for the nine month period ended
September 30, 2002 was primarily the result of the foregiveness of debt
associated with amounts owed on the legal fees attributable to our lawsuits
against Titan International, which as of March 18, 2002 had been settled.

        INCOME TAXES. Because of carry-forward losses from previous years, the
Company had no income tax provision in the first nine month period of 2002 or
2001.

                                       9
<PAGE>

        NET EARNINGS PER SHARE. Net earnings for the nine months ended September
30, 2002 were $285,498 compared to a net loss of $32,627 for the nine months
ended September 30, 2001. Basic earnings per share for the nine months ended
September 30, 2002 was $0.07 compared to a basic loss per share of $0.01 for the
nine months ended September 30, 2001. Diluted earnings per share for the nine
months ended September 30, 2002 was $0.07 compared to a basic loss per share of
$0.01 for the nine months ended September 30, 2001. See Exhibit 11 to this
Quarterly Report on Form 10-QSB.

LIQUIDITY AND CAPITAL RESOURCES

        In April 1998, we secured a credit facility with NationsCredit
Commercial Funding Corporation. The terms of the NCFC credit facility specified
a maximum combined term loan and revolving loan totaling $8.5 million at an
interest rate of 1.25% above the prime rate. The NCFC credit facility was
secured by substantially all of our assets and certain pledged assets from three
investors. During the third quarter of fiscal year 2000, we paid off and
terminated the NCFC credit facility. The proceeds for the pay-off were provided
by a loan from two investors totaling $1,200,000 at an interest rate of 2.25%
above the prime rate. The loan is secured by substantially all of our assets and
is due to expire in September 2003. No assurance can be given that this loan
will be extended beyond its maturity or that additional financing will be
available on terms acceptable to us, if at all. During the first quarter of
fiscal year 2001, we entered into a similar agreement with another investor for
a loan totaling $105,500 at an interest rate of 2.25% above the prime rate. This
loan is secured by substantially all of our assets and expires in April 2003.
During the quarter ended September 30, 2002 we paid off $40,000 of the loan
balance and reduced the outstanding indebtness associated with these secured
loans to $1,265,500.

        At September 30, 2002, we had an accumulated deficit of $16,916,716. For
the nine months ended September 30, 2002, our operating activities provided
$71,288 of cash, which was primarily attributable to lower payments on accounts
payable and accrued expenses, including legal costs associated with our various
litigation matters and the settlement of the Titan Lawsuit. During the nine
months ended September 30, 2002, our investing activities provided/used no cash.
During the nine months ended September 30, 2002, our financing activities used
$40,000 in cash.

        We do not anticipate any major capital budget expenditures in fiscal
year 2002. In addition, we do not believe our operating activities will generate
sufficient cash flow to meet our operating cash flow requirements and other debt
obligations as they come due. Consequently, it is likely we will be required to
raise additional funds from equity or debt financing or receive an extension on
our loans. However, we cannot provide any assurance that such additional
financing will be available on terms acceptable to us, if at all.

SEASONALITY

        Historically, we have experienced higher total revenue in the first two
quarters of the year than in the latter half of the year. We believe that this
results from seasonal buying patterns resulting, in part, from an increased
demand for certain automotive parts and accessories and its ultimate customers
having added liquidity from income tax refunds during the first half of the
year. We expect this seasonality to have an effect on the revenue stream derived
from sales of CRAGAR brand products by our license partners.

                                       10
<PAGE>

INFLATION

        Increases in inflation generally result in higher interest rates. Higher
interest rates on our borrowings would decrease our profitability. To date,
general price inflation has not had a significant impact on our operations;
however, increases in metal prices have from time to time, and could in the
future, adversely affect the total revenue derived from the sales of our
licensed products. See "Special Considerations - Dependence on External
Financing" and "History of Previous Losses; Stockholders' Deficit; Going Concern
Opinion."

                             SPECIAL CONSIDERATIONS

        Our future operating results and financial condition are dependent upon,
among other things, our ability to implement our new business strategy. Some,
but not all, potential risks and uncertainties that could affect our
profitability are set forth below.

WE ARE DEPENDENT ON EXTERNAL FINANCING.

        During the fiscal quarter ending September 30, 2000, we paid off and
terminated our credit facility with the proceeds from a loan from two investors
totaling $1,200,000 at an interest rate of 2.25% above the prime rate. The loan
is secured by substantially all of our assets and was due to expire in August
2001. However, we extended the term of the loan to September 1, 2003. No
assurance can be given, however, that this loan will be extended beyond its
maturity or that additional financing will be available on terms acceptable to
us, if at all. During the fiscal quarter ended March 31, 2001, we obtained a
loan from an investor totaling $105,500 at an interest rate of 2.25% above the
prime rate. The loan is secured by substantially all of our assets and expires
in April 2003. During the quarter ended September 30, 2002 we paid off $40,000
of the loan balance and reduced the outstanding indebtness associated with these
secured loans to $1,265,500. Upon expiration of these loans, it is likely we
will be required to raise additional funds through equity or debt financing to
repay such loans and to fund working capital. No assurance can be given,
however, that additional financing will be available on terms acceptable to us,
if at all.

WE HAVE A HISTORY OF PREVIOUS LOSSES AND A TOTAL STOCKHOLDERS' DEFICIT.

        We were incorporated in December 1992 and have incurred significant
losses in each of our fiscal years since fiscal year ended December 31, 1998.
For the fiscal year ended December 31, 2000, we reported net earnings of
$1,075,029 and for the fiscal year ended December 31, 1999, we reported net
earnings of $54,678. For the fiscal year ended December 31, 2001, we reported a
net loss of $1,357,031. As of December 31, 2001, we had an accumulated deficit
of $17,202,214 and a total stockholders' deficit of $1,484,061. There can be no
assurance that we will be profitable in the future.

THE INDEPENDENT AUDITOR'S REPORT ON OUR COMPANY'S 2001 FINANCIAL STATEMENTS HAS
BEEN QUALIFIED FOR A GOING CONCERN.

        As a result of our total stockholders' deficit and the uncertainty
regarding our ability to meet our anticipated operating and working capital
needs, the independent auditors' report on our company's 2001 financial
statements has been qualified for a going concern.

WE ARE DEPENDENT ON THIRD PARTIES TO GENERATE ROYALTIES.

        As a result of our change in business strategy, our revenue and
operating results will be substantially dependent on the efforts and success of
our third party licensing partners. Because

                                       11
<PAGE>

the amount of royalties payable to us are determined by the net sales of those
products by our licensing partners, our revenue will be subject to the abilities
of our licensing partners to generate substantial net sales and deliver a
high-quality product on a timely basis to our customers. In addition, because
the primary fiduciary obligations of our licensing partners are to their
stockholders rather than our stockholders, they may make decisions or take steps
that would result in lower royalty payments than would otherwise be the case. If
any of our licensing partners does not meet its obligation under its respective
licensing agreement, our primary remedy is to terminate that license agreement,
which may be an effective remedy only if we can identify and secure other
capable licensees of the affected products.

WE MAY BE UNABLE TO SUPPORT MANUFACTURING, MARKETING, SALE, AND DISTRIBUTION IF
ANY OF OUR LICENSE AGREEMENTS ARE TERMINATED.

        If any of our licensing partners terminates its license agreement or we
terminate the license agreement for any reason, we may be forced to incur the
cost of manufacturing, marketing, selling, and distributing the licensed
products without the financial resources and distribution capabilities of our
licensees. In the alternative, we would be forced to possibly secure another
licensee capable of manufacturing, marketing, selling, and distributing the
licensed products on our behalf and paying any royalties based on the net sales
of those products. There can be no assurance that we would be able to meet these
obligations in the event that one or more of the license agreements is
terminated.

OUR INVESTMENT IN WRENCHEAD MAY NOT BE PROFITABLE.

        We have made a substantial investment in Wrenchead, Inc. During the
fourth quarter of fiscal year 2001, we reported a loss of $1,229,029 on our
investment in Wrenchead due to the reduction in estimated market value of
Wrenchead common stock. There can be no assurance that the investment in
Wrenchead will turn out to be profitable.

ROYALTY PAYMENTS WILL DECREASE AS A PERCENTAGE OF SALES AS ROYALTIES INCREASE.

        The royalty structure negotiated by us with two of our current licensing
partners provides for a decrease in the applicable percentage of net sales that
determines royalty payments to us as net sales increase above certain levels.
The consequence of this structure is that our ability to realize the benefits of
a substantial increase in sales with respect to any group of our licensed
products sold by those licensing partners will be limited by the negotiated
royalty fee structure as net sales of the licensed products increase.

OUR CHANGE IN BUSINESS STRATEGY MAY DEPRESS THE VALUE OF OUR COMMON STOCK.

        The completion of the sale and licensing of our one-piece cast aluminum
wheels and related accessories, our wheels with non-cast wrought aluminum alloy
outer rims and related accessories, our line of wheels with steel outer rims and
related accessories, and any other related licensing arrangement we may complete
in the future represents a significant change in our business model. In general,
the outsourcing of the manufacturing, marketing, sales, and distribution
operations with respect to the licensed products, together with the sale of the
related assets, will result in a substantial decrease in our revenue and
operating and marketing costs. We anticipate that a stream of royalty payments
generated by the net sales of the licensed products by our licensing partners
will replace the decrease in revenue and operating and marketing costs. As a
result, we only have one year of history of financial results upon which
stockholders can rely to make a determination that the new business strategy
will be successful. Given the uncertainty of

                                       12
<PAGE>

the consequences of this change in business strategy, as well as the significant
decrease in revenue expected to occur, there can be no assurance that the change
will result in a profitable stream of royalty payments. As a result of this
uncertainty, the price of our common stock may be adversely affected.

THE EXTENSION OF OUR BRAND NAMES TO OTHER PRODUCTS MAY NOT BE SUCCESSFUL.

        Our business strategy contemplates using the services of Trademarketing
Resources, Inc. to extend the CRAGAR brand names to new products developed by
our licensees as well as to non-wheel related products within the automotive
aftermarket industry. We regard this extension of our brand names to new
products as a key element of a strategy that is designed to increase net sales
of CRAGAR brand products to generate increased royalty revenue. There can be no
assurance, however, that TRI, our licensees, or we will be successful in
developing and marketing any new products under the CRAGAR brand names, or if
any new products are developed, that the net sales of these products will have a
positive impact on our financial results.

WE HAVE NO DUTY TO DISTRIBUTE ROYALTY PAYMENTS TO OUR STOCKHOLDERS.

        We anticipate using any royalty payments we receive pursuant to our
licensing agreements to increase our working capital and reduce our debt. We
have never paid any cash dividends on our common stock and do not anticipate
doing so in the foreseeable future. As a result, stockholders should not
anticipate that they will receive any distribution of the royalties generated by
our licensing transactions.

WE ARE DEPENDANT ON KEY CUSTOMERS AND OUR LICENSEES ABILITY TO MARKET AND SELL
TO EXISTING AND NEW CUSTOMERS.

        A limited number of customers have historically accounted for a
substantial portion of our revenue in each fiscal year. These are the same
customers doing business with our licensees. In the past, the financial
condition and success of our customers and our ability to obtain orders from new
customers have been critical to our success and will be critical to the success
of our licensing partners. As a result of our change in business strategy, we
believe an increasing percentage of revenue will be dependent on royalties from
sales of CRAGAR products by our licensing partners. There can be no assurance
that any of the licensees will be successful in their sales and marketing
efforts.

OUR INDUSTRY IS HIGHLY COMPETITIVE.

        The market for our products is highly competitive. We historically
competed primarily on the basis of product selection (which includes style and
vehicle fit), timely availability of product for delivery, quality, design
innovation, price, payment terms, and service. We anticipate that our licensing
partners will compete on those same terms. We believe that Weld, Carlisle, and
Performance have sufficient financial, operational, and distribution
capabilities to compete effectively within the custom aftermarket wheel
industry. However, there can be no assurance that our licensing partners will be
successful in marketing custom aftermarket wheels under the CRAGAR brand names.
Increased competition could result in price reductions (which may be in the form
of rebates or allowances), reduced margins, and loss of market share, all of
which could have a material adverse effect on our licensing partners, possibly
resulting in the reduction or elimination of royalty payments due to us.

                                       13
<PAGE>

GENERAL ECONOMIC FACTORS MAY ADVERSELY AFFECT OUR BUSINESS.

        The automotive aftermarket is directly impacted by certain external
factors, such as the general demand for aftermarket automotive parts, prices for
raw materials used in producing our products, fluctuations in discretionary
consumer spending, and general economic conditions, including, but not limited
to, employment levels, business conditions, interest rates, and tax rates. While
we believe that current economic conditions favor stability in the markets in
which our products are sold, various factors, including, but not limited to,
those listed above, could lead to decreased sales and increased operating
expenses. We cannot provide any assurances that various factors will not
adversely affect our licensing partners' businesses in the future, causing a
decrease in royalty payments due us, or prevent us from successfully
implementing our business strategies.

WE CANNOT PROVIDE ANY ASSURANCES OF ADDITIONAL SUCCESSFUL ALLIANCES.

        In furtherance of our change in business strategy and sale of our
licensing rights, we will continue to consider alliances with other companies
that could complement our new business strategy, including other complementary
automotive aftermarket product lines where we can capitalize on the CRAGAR brand
name. We cannot provide any assurances that suitable licensing candidates can be
identified, or that, if identified, adequate and acceptable licensing terms will
be available to us. Furthermore, even if we complete one or more licensing
agreements, there can be no assurance that our licensing partners will be
successful in manufacturing, marketing, selling, and distributing the licensed
products.

        Any additional investment by us in Wrenchead or other companies may
result in a potentially dilutive issuance of equity securities, or the
incurrence of additional debt, which could adversely affect our financial
position. Alliances, whether licensing or direct investments in companies,
involve numerous risks, such as the diversion of the attention of our management
from other business concerns and our entrance into markets in which we have had
no or only limited experience, both of which could have a material adverse
effect on our business, financial condition, and results of operations.

OUR OPERATING RESULTS MAY VARY SUBSTANTIALLY FROM QUARTER TO QUARTER.

        Our results of operations have historically been subject to substantial
variations as a result of a number of factors and we anticipate that these same
factors will continue to impact seasonal variation. In particular, in the past
our operating results varied due to the size and timing of customer orders,
delays in new product enhancements and new product introductions, vendor quality
control and delivery difficulties, market acceptance of new products, product
returns, product rebates and allowances, seasonality in product purchases by
distributors and end users, and pricing trends in the automotive aftermarket
industry in general and in the specific markets in which we participated and
that our custom wheel licensees participate in. Historically, our net sales were
highest in the first and second quarters of each fiscal year. Significant
variation in orders during any period may have an impact on our cash flow or
workflow. We believe that any period-to-period comparisons of our financial
results are not necessarily meaningful and should not be relied upon as an
indication of future performance. We expect that our licensing partners will be
subject to the same variations and industry seasonality as we have experienced
in the past. These variations may cause fluctuations in the sales of CRAGAR
branded products thereby causing fluctuations in the royalties due us.

                                       14
<PAGE>

WE ARE SUBJECT TO CHANGING CUSTOMER TRENDS.

        Our success will depend, in part, on the ability of our licensing
partners to correctly and consistently anticipate, gauge, and respond in a
timely manner to changing consumer preferences. We cannot provide any assurance
that our licensed products will continue to enjoy acceptance among consumers or
that any of the future CRAGAR branded products developed and marketed by our
licensing partners will achieve or maintain market acceptance. Any misjudgment
by our licensing partners of the market for a particular product or product
extension, or their failure to correctly anticipate changing consumer
preferences, could have a material adverse effect on their businesses, financial
condition, and results of operations. Any material adverse effect experienced by
our licensing partners may have an adverse effect on us and our business,
financial condition, and results of operations.

WE ARE SUBJECT TO VARIOUS GOVERNMENTAL REGULATIONS.

        We historically have been subject to various federal and state
governmental regulations related to occupational safety and health, labor, and
wage practices as well as federal, state, and local governmental regulations
relating to the storage, discharge, handling, emission, generation, manufacture,
and disposal of toxic or other hazardous substances used to produce our
products. We believe that we have been and are currently in material compliance
with such regulations. Prior to November 1999, in the ordinary course of our
business, we used metals, oils, and similar materials, which were stored on
site. The waste created by use of these materials was transported off-site on a
regular basis by a state-registered waste hauler. Although we are not aware of
any material claim or investigation with respect to these activities, we cannot
provide any assurance that such a claim may not arise in the future or that the
cost of complying with governmental regulations in the future will not have a
material adverse effect on us.

        We are subject to regulation as a publicly traded company under the
Securities Exchange Act of 1934. In addition, as a consequence of the sale and
licensing of our wrought wheel, steel outer rim wheel and one-piece businesses,
which could be considered a sale of substantially all of our assets, in exchange
for the receipt of a stream of royalty payments, we could face regulatory issues
under the Investment Company Act of 1940 if the royalty payments are considered
investment securities. If we are considered to be an investment company under
the 1940 Act, we would be required to register under that Act as an investment
company. As a registered investment company, we would be subject to further
regulatory oversight of the Division of Investment Management of the SEC, and
our activities would be subject to substantial and costly regulation under the
1940 Act. While we do not believe that our activities will subject us to the
1940 Act and accordingly do not intend to register as an investment company
under the Act, we cannot provide any assurances that such registration would not
be required in the future.

WE RELY ON INTELLECTUAL PROPERTY.

        We own the rights to certain trademarks and patents, rely on trade
secrets and proprietary information, technology, and know-how, and seek to
protect this information through agreements with former employees and vendors.
We cannot provide any assurances that our patents will preclude our competitors
from designing competitive products, that proprietary information or
confidentiality agreements with licensees, former employees, and others will not
be breached, that our patents will not be infringed, that we would have adequate
remedies for any breach or infringement, or that our trade secrets will not
otherwise become known to or independently developed by our competitors.

                                       15
<PAGE>

OUR EXISTING STOCKHOLDERS MAY EFFECTIVELY CONTROL OUR COMPANY.

        Our directors, officers, and principal stockholders beneficially own
approximately 36.5% of our outstanding common stock. As a result, these persons
have a significant influence on our affairs and management, as well as on all
matters requiring stockholder approval, including electing and removing members
of our Board of Directors, causing us to engage in transactions with affiliated
entities, causing or restricting the sale or merger of our company, and changing
our dividend policy. Such concentration of ownership and control could have the
effect of delaying, deferring, or preventing a change in control of our company
even when such a change of control would be in the best interest of our other
stockholders.

THE ISSUANCE OF LARGE AMOUNTS OF PREFERRED STOCK COULD HAVE A MATERIAL ADVERSE
EFFECT ON THE VALUE OF OUR COMMON STOCK.

        Our Amended and Restated Certificate of Incorporation authorizes our
Board of Directors to issue "blank check" preferred stock, the relative rights,
powers, preferences, limitations, and restrictions of which may be fixed or
altered from time to time by our Board of Directors. Accordingly, our Board of
Directors is empowered, without stockholder approval, to issue preferred stock
with dividend, liquidation, conversion, voting, or other rights that could
adversely affect the voting power and other rights of the holders of common
stock. In the first quarter of 1998, for example, we issued 22,500 shares of
Series A Preferred Stock for approximately $2,250,000 in additional capital.
During the quarter ended September 30, 2000, 11,500 shares of Series A Preferred
Stock and the preferred stock dividends issued on that stock were converted into
456,393 shares of our common stock. During the month ended January 30, 2001, an
additional 11,000 shares of Series A Preferred Stock and the preferred stock
dividends issued on that stock were converted into 616,131 shares of common
stock. As of the month ended January 30, 2001 there was no longer any Series A
Preferred Stock outstanding.

        Additional series of preferred stock could be issued, under certain
circumstances, as a method of discouraging, delaying, or preventing a change in
control of our company that stockholders might consider to be in our company's
best interests. There can be no assurance that we will not issue additional
shares of preferred stock in the future.

WE ARE DEPENDENT ON KEY PERSONNEL.

        Our future success depends, in large part, on the efforts of Michael L.
Hartzmark, our Chairman and Chief Executive Officer. The loss of the services of
Dr. Hartzmark could have a material adverse effect on our business. While Dr.
Hartzmark does not have an employment agreement with us, Dr. Hartzmark and his
family beneficially held, as of December 31, 2001, more than 16.7% of our common
stock. The successful implementation of our business strategies will depend, for
the most part, on qualified management and other personnel being hired by our
licensing partners. In addition, the successful implementation of our brand
extension strategy will depend, for the most part, on the qualified management
and other personnel working at Trademarketing Resources, Inc. We have no input
in the hiring decisions being made by our licensing partners. We do not maintain
key man insurance on any of our personnel or consultants.

WE HAVE NEVER PAID CASH DIVIDENDS.

        We have never paid cash dividends or stock dividends on our common stock
and do not anticipate that we will pay cash dividends in the foreseeable future.
It is anticipated that any earnings will be used to finance growth of our
business and to reduce our debt.

                                       16
<PAGE>

ITEM 3.     CONTROLS AND PROCEDURES

        As required by Rule 13a-15 under the Exchange Act, within the 90 days
prior to the filing date of this report, we carried out an evaluation of the
effectiveness of the design and operation of our disclosure controls and
procedures. This evaluation was carried out under the supervision and with the
participation of our management, including our Chief Executive Officer along
with our Chief Financial Officer and Chief Accounting Officer. Based upon that
evaluation, our Chief Executive Officer along with our Chief Financial Officer
concluded that our disclosure controls and procedures are effective. There have
been no significant changes in our internal controls or in other factors that
could significantly affect internal controls subsequent to the date we carried
out our evaluation.

        Disclosure controls and procedures are controls and other procedures
that are designed to ensure that information required to be disclosed in Company
reports filed or submitted under the Exchange Act is recorded, processed,
summarized and reported within the time periods specified in the Securities and
Exchange Commission's rules and forms. Disclosure controls and procedures
include controls and procedures designed to ensure that information required to
be disclosed in Company reports filed under the Exchange Act is accumulated and
communicated to management, including our Chief Executive Officer and Chief
Financial Officer as appropriate, to allow timely decisions regarding required
disclosure.

                           PART II - OTHER INFORMATION
                           ---------------------------

ITEM 1.     LEGAL PROCEEDINGS

        We are an unsecured creditor in the matter of in Re Super Shops, Inc.,
et al., Case No. LA 97-46094-ER, a bankruptcy action filed by Super Shops, Inc.,
previously our primary customer. Because we are an unsecured creditor in this
matter, the amount and timing of the recovery, if any, on our account receivable
from Super Shops, Inc. is uncertain. In connection with this proceeding, we
incurred an obligation of $125,000 in fiscal year 1998, for preference payments
as a result of the on-going liquidation of the bankruptcy estate. We paid this
obligation during the third quarter of fiscal year 1999.

        Sears, Roebuck and Co., filed a lawsuit against us in the Superior
Court, Maricopa County, State of Arizona, Case No. CV2001021979, seeking a
recovery of $29,000. The lawsuit alleged, among other things, breach of contract
and conversion arising out of a supply arrangement that was terminated in 1999.
We plan on vigorously defending this matter.

        There are currently no other material pending proceedings to which we
are a party or to which any of our property is subject, although we are from
time to time involved in routine litigation incidental to the conduct of our
business.

        We currently maintain discontinued product liability insurance, with
limits of $1.0 million per occurrence and $2.0 million in the aggregate per
annum. However, such coverage is becoming increasingly expensive and difficult
to obtain. There can be no assurance that we will be able to maintain adequate
product liability insurance at commercially reasonable rates or that our
insurance will be adequate to cover future product liability claims. Any losses
that we may

                                       17
<PAGE>

suffer as a result of claims in excess of our coverage could have a material
adverse effect on our business, financial condition, and results of operations.

ITEM 2.     CHANGES IN SECURITIES AND USE OF PROCEEDS

        A loan from two investors totaling $1,200,000 at an interest rate of
2.25% above the prime rate was extended for one year and is due to expire in
September 2003. The loan is secured by substantially all of our assets. In
exchange for the one year extension, we issued two warrants in a form not
materially different from that used for previous issuances, for the purchase of
84,000 shares of common stock, in aggregate, at an exercise price of $1.05. The
exercise price was equal to the closing share price on the date of issuance.


ITEM 3.     DEFAULTS UPON SENIOR SECURITIES

            None

ITEM 4.     SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

            None.

ITEM 5.     OTHER INFORMATION

            None

ITEM 6.     EXHIBITS AND REPORTS ON FORM 8-K

(a)         Exhibits

EXHIBIT
NUMBER                         DESCRIPTION
------                         -----------

3.1         Second Amended and Restated Certificate of Incorporation of the
            Registrant filed with State of Delaware on October 1, 1996 (1)

3.2         Amended and Restated Bylaws of the Registrant (1)

3.3         Form of Certificate of Designation (3)

4           Form of Certificate representing Common Stock (1)

4.1         Form of Warrant Agreement (2)

4.3         Form of Warrant Certificate (1)

4.4         Loan and Security Agreement, dated as of April 20, 1998, executed by
            and between Registrant and NationsCredit Commercial Corporation (4)

4.5         Form of Class A Stock Purchase Warrant Certificate (1)

4.7         Form of Class C Stock Purchase Warrant Certificate (1)

4.8         Form of Stock Option / Restricted Stock Grant for grants made
            pursuant to either or both the CRAGAR Industries, Inc. 1996
            Non-Employee Directors' Stock Option Plan and the CRAGAR Industries,
            Inc. 1996 Stock Option and Restricted Stock Plan (1)

4.9         Form of Representative's Warrant Agreement, dated December 18, 1996,
            by and between the Registrant and Dickinson & Co. (2)

10.1        CRAGAR Industries, Inc. 1996 Non-Employee Directors' Stock Option
            Plan (1)

10.1(a)     First Amendment to the CRAGAR Industries, Inc. 1996 Non-Employee
            Directors' Stock Option Plan, dated October 1, 1996 (1)

                                       18
<PAGE>

10.2        CRAGAR Industries, Inc. 1996 Stock Option and Restricted Stock Plan
            (1)

10.2(a)     First Amendment to the CRAGAR Industries, Inc. 1996 Stock Option and
            Restricted Stock Plan, dated October 1, 1996 (1)

10.3        Commercial Lease, dated February 5, 1993, executed by and between
            Registrant and Principal Mutual Life Insurance Company (1)

10.4        Form of Promissory Note of the Registrant, dated March 16, 1999 (5)

10.5        Form of Security Agreement underlying Promissory Note of the
            Registrant, dated March 16, 1999 (5)

10.6        Agreement of Purchase and Sale of Assets between the Registrant and
            Weld Racing, Inc. dated September 30, 1999 (6)

10.7        Exclusive Field of Use License Agreement between the Registrant and
            Weld Racing, Inc. dated September 30, 1999 (6)

10.8        Agreement of Purchase and Sale of Assets between the Registrant and
            Carlisle Tire and Wheel Co. dated October 15, 1999 (6)

10.9        Exclusive Field of Use License Agreement between the Registrant and
            Carlisle Tire and Wheel Co. dated October 15, 1999 (6)

10.10       Form of Promissory Note of the Registrant, dated December 22, 1999
            (7)

10.11       Form of Security Agreement underlying Promissory Note of Registrant,
            dated December 22, 1999 (7)

10.12       Stock Option (8)

10.13       Sales Agreement (8)

10.14       Amendment to Sales Agreement (8)

10.15       Form of Promissory Note of the Registrant, dated August 1, 2000 (9)

10.16       Form of Security Agreement underlying Promissory Note of the
            Registrant, dated August 1, 2000 (9)

10.17       Form of Security Agreement (Pledge) underlying Promissory Note of
            the Registrant, dated August 1, 2000 (9)

10.18       Exclusive Field of Use License Agreement between the Registrant and
            Performance Wheel Outlet, Inc. dated September 1, 2000 (9)

10.19       Form of Promissory Note of the Registrant, dated March 1, 2001 (9)

10.20       Form of Restricted Stock Agreement with Trademarketing Resources,
            Inc. (10)

10.21       Licensing Representation Agreement with Trademarketing Resources,
            Inc. (11)

11          Schedule of Computation of Earnings per Share

21          List of Subsidiaries of the Registrant (1)

99.1        Certification Pursuant to 18 U.S.C Section 1350

99.2        Certification Pursuant to 18 U.S.C Section 1350

---------------

     (1)    Incorporated by reference to Cragar's Registration on Form SB-2 (No.
            333-13415)

     (2)    Incorporated by reference to Cragar's Annual Report on Form 10-K for
            the fiscal year ended December 31, 1996 (No. 1-12559)

     (3)    Incorporated by reference to Cragar's Current Report of Form 8-K,
            filed January 23, 1999 (no. 1-12559)

     (4)    Incorporated by reference to Cragar's Quarterly Report on Form
            10QSB, filed on May 15, 1998 (no. 1-12559)

     (5)    Incorporated by reference to Cragar's Quarterly Report on Form
            10QSB, filed on May 12, 1999 (no. 1-12559)

     (6)    Incorporated by reference to Cragar's Quarterly Report on Form
            10QSB, filed on November 15, 1999 (no. 1-12559)

     (7)    Incorporated by reference to Cragar's Annual Report on Form 10-K for
            the fiscal year ended December 31, 1999 (No. 1-12559)

                                       19
<PAGE>

     (8)    Incorporated by reference to Cragar's Quarterly Report on Form
            10QSB, filed on August 15, 2000 (no. 1-12559)

     (9)    Incorporated by reference to Cragar's Annual Report on Form 10-K for
            the fiscal year ended December 31, 2000 (No. 1-12559)

     (10)   Incorporated by reference to Cragar's Registration Statement on Form
            S-8 filed on May 22, 2001 (No. 333-61414)

     (11)   Incorporated by reference to Cragar's Quarterly Report on Form
            10QSB, filed on August 14, 2001 (no. 1-12559)



                                   SIGNATURES
                                   ----------

            Pursuant to the requirements of the Securities Exchange Act of 1934,
the Company has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

                             CRAGAR INDUSTRIES, INC.

Dated:  November 14, 2002               By: /s/ Michael L. Hartzmark
        ----------------------             --------------------------
                                           Michael L. Hartzmark
                                           Chairman, CEO and Treasurer

Dated:  November 14, 2002               By: /s/ Richard P. Franke
        ----------------------              -------------------------
                                            Richard P. Franke
                                            Chief Financial Officer
                                            (Principal Financial and Accounting
                                            Officer)




                                       20
<PAGE>

                                  CERTIFICATION

        I, Michael L. Hartzmark, certify that:

        1. I have reviewed this quarterly report on Form 10-QSB of Cragar
Industries, Inc.;

        2. Based on my knowledge, this quarterly report does not contain any
untrue statement of a material fact or omit to state a material fact necessary
to make the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by this
quarterly report;

        3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all material
respects the financial condition, results of operations, and cash flows of the
registrant as of, and for, the periods presented in this quarterly report;

        4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:

               a) designed such disclosure controls and procedures to ensure
        that material information relating to the registrant, including its
        consolidated subsidiaries, is made known to us by others within those
        entities, particularly during the period in which this quarterly report
        is being prepared;

               b) evaluated the effectiveness of the registrant's disclosure
        controls and procedures as of a date within 90 days prior to the filing
        date of this quarterly report (the "Evaluation Date"); and

               c) presented in this quarterly report our conclusions about the
        effectiveness of the disclosure controls and procedures based on our
        evaluation as of the Evaluation Date;

        5. The registrant's other certifying officers and I have disclosed,
based on our most recent evaluation, to the registrant's auditors and the audit
committee of the registrant's board of directors (or persons performing the
equivalent functions):

               a) all significant deficiencies in the design or operation of
        internal controls which could adversely affect the registrant's ability
        to record, process, summarize, and report financial data and have
        identified for the registrant's auditors any material weaknesses in
        internal controls; and

               b) any fraud, whether or not material, that involves management
        or other employees who have a significant role in the registrant's
        internal controls; and

        6. The registrant's other certifying officers and I have indicated in
this quarterly report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal controls
subsequent to the date of our most recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.

Date:  November 14, 2002



                                           By: /s/ Michael L. Hartzmark
                                               ---------------------------------
                                               Michael L. Hartzmark
                                               Chairman, CEO and Treasurer

                                       21
<PAGE>

                                  CERTIFICATION

        I, Richard P. Franke, certify that:

        1. I have reviewed this quarterly report on Form 10-QSB of Cragar
Industries, Inc.;

        2. Based on my knowledge, this quarterly report does not contain any
untrue statement of a material fact or omit to state a material fact necessary
to make the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by this
quarterly report;

        3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all material
respects the financial condition, results of operations, and cash flows of the
registrant as of, and for, the periods presented in this quarterly report;

        4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:

               a) designed such disclosure controls and procedures to ensure
        that material information relating to the registrant, including its
        consolidated subsidiaries, is made known to us by others within those
        entities, particularly during the period in which this quarterly report
        is being prepared;

               b) evaluated the effectiveness of the registrant's disclosure
        controls and procedures as of a date within 90 days prior to the filing
        date of this quarterly report (the "Evaluation Date"); and

               c) presented in this quarterly report our conclusions about the
        effectiveness of the disclosure controls and procedures based on our
        evaluation as of the Evaluation Date;

        5. The registrant's other certifying officers and I have disclosed,
based on our most recent evaluation, to the registrant's auditors and the audit
committee of the registrant's board of directors (or persons performing the
equivalent functions):

               a) all significant deficiencies in the design or operation of
        internal controls which could adversely affect the registrant's ability
        to record, process, summarize, and report financial data and have
        identified for the registrant's auditors any material weaknesses in
        internal controls; and

               b) any fraud, whether or not material, that involves management
        or other employees who have a significant role in the registrant's
        internal controls; and

        6. The registrant's other certifying officers and I have indicated in
this quarterly report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal controls
subsequent to the date of our most recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.

Date:  November 14, 2002



                                           By: /s/ Richard P. Franke
                                               ---------------------------------
                                               Richard P. Franke
                                               Chief Financial Officer