SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-QSB


(MARK ONE)

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

     For the quarterly period ended March 31, 2000

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

For the transition period from _______________ to ______________

                                     0-20436
                             Commission file number

                       U.S. AUTOMOTIVE MANUFACTURING, INC.
        (Exact Name of Small Business Issuer as Specified in its Charter)

           Delaware                                              65-0309477
  (State of other jurisdiction                                 (IRS Employer
of incorporation or organization)                            Identification No.)

Route 627, Airport Drive, Tappahannock, VA                         22560
(Address of principal executive offices)                         (Zip Code)

Issuer's telephone number, including area code: (804) 443-5356

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

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 [ ]

As of May 15, 2000,  the  Registrant  had 1,297,980  shares  outstanding  of its
common stock, $.001 par value.

Transitional Small Business Disclosure Format (check one):

                                 Yes [ ]  No [X]


<PAGE>


                       U.S. AUTOMOTIVE MANUFACTURING, INC.

                                      INDEX

                                                                            Page

PART I. FINANCIAL INFORMATION .............................................   3

Item 1.  Consolidated Financial Statements

         Consolidated Balance Sheets at March 31, 2000
           (unaudited) and December 31, 1999 ..............................   3

         Consolidated Statements of Operations (unaudited) for the
            three months ended March 31, 2000 and March 31, 1999 ..........   4

         Consolidated Statements of Cash Flows (unaudited) for
            the three months ended March 31, 2000 and March 31, 1999 ......   5

         Notes to Consolidated Financial Statements .......................   6

Item 2.  Management's Discussion and Analysis or Plan
              of Operation ................................................  10

PART II. OTHER INFORMATION ................................................  14

Item 1.  Legal Proceedings ................................................  14

Item 2.  Changes in Securities and Use of Proceeds ........................  14

Item 4.  Submission of Matters to a Vote of Security Holders ..............  14

Item 5.  Other Information ................................................  14

Item 6.  Exhibits and Reports on Form 8-K .................................  15


SIGNATURES ................................................................  16


                                       2
<PAGE>


                                     PART I
                              FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

                       U.S. AUTOMOTIVE MANUFACTURING, INC.

                           Consolidated Balance Sheets
                                 March 31, 2000


<TABLE>
<CAPTION>
                                                                       March 31, 2000    December 31, 1999
                                                                       --------------    -----------------
                                                                        (unaudited)
<S>                                                                     <C>                 <C>
ASSETS

Current Assets:
         Cash .......................................................   $     57,798        $    151,685
         Accounts receivable (net of allowance of  $108,570 and
             $73,000 respectively) ..................................      5,113,923           3,531,487
         Inventories ................................................      9,042,638           8,745,814
         Prepaid expenses, and other ................................         14,436              27,978
                                                                        ------------        ------------
                             Total Current Assets ...................     14,228,795          12,456,964
Property, plant and equipment (net of accumulated
    depreciation of $1,863,638 and $1,599,818,
    respectively) ...................................................     10,851,123          10,965,687
Deferred financing costs ............................................        360,221             397,989
Goodwill, net .......................................................      5,555,924           5,635,673
                                                                        ------------        ------------
TOTAL ASSETS ........................................................   $ 30,996,063        $ 29,456,313
                                                                        ============        ============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
         Line of credit .............................................      8,563,665           7,220,713
         Current portion of long-term debt ..........................      4,140,324           4,299,657
         Accounts payable ...........................................      4,672,800           3,518,527
         Accrued liabilities ........................................      1,714,336           1,549,969
                                                                        ------------        ------------
                             Total Current Liabilities ..............     19,091,125          16,588,866
Long-term debt, less current portion ................................        117,194             124,079
Notes payable to shareholders .......................................      5,430,000           5,340,000
                                                                        ------------        ------------
                             Total Liabilities ......................     24,638,319          22,052,945
                                                                        ------------        ------------
Stockholders' Equity:
Issued & outstanding capital stock $.001 par value ..................          1,317               1,268
Additional paid-in capital ..........................................     39,300,073          39,252,927
Accumulated deficit .................................................    (32,943,646)        (31,850,827)
                                                                        ------------        ------------
                             Total stockholders' equity .............      6,357,744           7,403,368
                                                                        ------------        ------------
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY ............................   $ 30,996,063        $ 29,456,313
                                                                        ============        ============
</TABLE>


              The accompanying notes are an integral part of these
                       consolidated financial statements.


                                       3
<PAGE>


                       U.S. AUTOMOTIVE MANUFACTURING, INC.

                      Consolidated Statements of Operations
                                   (Unaudited)

                                                  Three Months Ended March 31,
                                                  ----------------------------
                                                     2000             1999
                                                     -----            -----
Net sales ......................................  $ 5,821,715      $ 7,320,955
Cost of goods sold .............................    4,777,490        5,305,134
                                                  -----------      -----------
Gross profit ...................................    1,044,225        2,015,821
                                                  -----------      -----------
Operating expenses:
        Selling and delivery ...................      725,666          782,815
        General and administrative .............      940,785          969,351
                                                  -----------      -----------
        Total operating expenses ...............    1,666,451        1,752,166
                                                  -----------      -----------
Operating (loss) income ........................     (622,226)         263,655
Interest expense ...............................     (483,093)        (498,121)
                                                  -----------      -----------
Net loss .......................................  $(1,105,319)     $  (234,466)
                                                  ===========      ===========
Net loss per share, basic and diluted ..........  $     (0.86)     $     (0.22)
                                                  ===========      ===========
Weighted average shares outstanding ............    1,289,124        1,048,656
                                                  ===========      ===========


              The accompanying notes are an integral part of these
                       consolidated financial statements.


                                       4
<PAGE>


                       U.S. AUTOMOTIVE MANUFACTURING, INC.

                      Consolidated Statements of Cash Flows
                                   (Unaudited)


<TABLE>
<CAPTION>
                                                                                   Three Months Ended March 31,
                                                                                   ----------------------------
                                                                                      2000              1999
                                                                                      ----              -----
<S>                                                                               <C>               <C>
CASH FLOW FROM OPERATING ACTIVITIES
Net Loss ......................................................................   $(1,105,319)      $  (234,466)
Adjustments to reconcile net loss
    to net cash (used in) provided by operating activities:
          Depreciation and Amortization .......................................       443,772           370,569
          Rollover of accrued interest into shareholder note ..................        90,000            90,000
          (Increase) decrease in:
                    Accounts receivable .......................................    (1,582,436)         (200,057)
                    Inventory .................................................      (296,824)          508,442
                    Prepaid expenses and other ................................        13,542          (137,592)
          Increase in:
                    Accounts payable and accrued liabilities ..................     1,338,334           681,952
                                                                                  -----------       -----------
Total adjustments .............................................................         6,388         1,313,314
                                                                                  -----------       -----------
Net cash (used in) provided by operating activities ...........................    (1,098,931)        1,078,848
CASH FLOWS FROM INVESTING ACTIVITIES
          Capital expenditures ................................................      (211,691)          (65,311)
                                                                                  -----------       -----------
CASH FLOW FROM FINANCING ACTIVITIES
          Net borrowings (repayments)  on lines of credit and
          notes payable .......................................................     1,216,735          (907,930)
                                                                                  -----------       -----------
NET (DECREASE) INCREASE IN CASH ...............................................       (93,887)          105,607
CASH-beginning of period ......................................................       151,685           338,641
                                                                                  -----------       -----------
CASH-end of period ............................................................   $    57,798       $   444,248
                                                                                  ===========       ===========

     Supplemental Cash Flow Information:
         Cash paid for interest                                                   $   252,557       $   239,371
         Accrued Interest Expense                                                 $   230,534       $   258,750
         Non-cash financing and investing activities:
                  Conversion of convertible debentures and
                      accrued interest payable into common stock                  $    47,195              --
                  Directors fees converted into common stock                      $    12,500       $    36,666
</TABLE>


              The accompanying notes are an integral part of these
                       consolidated financial statements.


                                       5
<PAGE>


                       U.S AUTOMOTIVE MANUFACTURING, INC.

                   Notes to Consolidated Financial Statements
                                 March 31, 2000
                                   (Unaudited)


NOTE 1: BUSINESS OPERATIONS AND ORGANIZATION

     U.S. Automotive Manufacturing, Inc., a Delaware corporation incorporated on
January 16, 1992, together with its wholly-owned subsidiaries Quality Automotive
Company and U.S.  Automotive  Friction,  Inc.  (collectively,  the "Company") is
engaged  in the  manufacture,  assembly  and  distribution  of new  and  rebuilt
automotive   friction   products.   The  Company  maintains   manufacturing  and
warehouse/distribution facilities in Tappahannock, Virginia and Sanford, Florida
(the "Facilities").

     The  Company  manufactures  a full line of  automotive  friction  products,
including   brake  lining,   integrally   molded  and  riveted  brake  pads  and
remanufactured brake shoes. The Company markets various grades of friction brake
lining,  using  asbestos,  non  asbestos  organic  and  semi-metallic  formulas,
suitable for use by the automotive and light truck after-markets.  The Company's
products  are  marketed   under  the  Brakes  Worth   Stopping   For,(R)  Silent
Solution,(R)  Gold Max,(R) Dual  Friction,(TM)  Ultra Brake,(TM)  Ustop,(TM) and
Quality Automotive(TM)  tradenames and various private label packaging. In 1999,
the Company's  products were also sold under the  Roinco,(TM) and Max Life, (TM)
tradenames.

     Brake pads,  brake shoes or a combination of both are  incorporated  in all
makes and models of American  and  imported  automobiles.  All  imported and the
majority of late model domestic  automobiles are equipped with integrally molded
brake pads. The Company generally  produces the replacement brake under the same
process used to manufacture the vehicle's original equipment.

     The Company sells its friction  products to other automotive  manufacturers
and the automotive  after-market.  The automotive  after-market  encompasses the
parts and  service  sold to the  vehicle  owners  for repair or  replacement  of
original  equipment  parts. The Company believes that the market for replacement
parts generally  consists of vehicles which are three to twelve years old. Sales
of  the  Company's   products  are  made  to  mass   merchandisers,   automotive
distributors,  chain stores and other brake manufacturers.  The Company does not
market its products directly to retail customers.

NOTE 2: UNAUDITED INTERIM STATEMENTS

     The accompanying unaudited consolidated financial statements of the Company
have been prepared in accordance  with the  instructions to Form 10 - QSB and do
not include all of the information and footnotes  required by generally accepted
accounting  principles  for  complete  financial  statements.  In the opinion of
management, all adjustments (which consist only of normal recurring adjustments)
necessary  for  a  fair  presentation   have  been  included.   All  significant
intercompany  transactions and balances have been eliminated.  Operating results
for the three months ended March 31, 2000, are not necessarily indicative of the
results to be expected for the year ending  December 31, 2000.  These  financial
statements and notes should be read in conjunction with the financial statements
and notes thereto included in the Company's Annual Report on Form 10-KSB for the
year ended December 31, 1999.

     The Company's financial  statements are presented on a going concern basis,
which contemplates the realization of assets and the satisfaction of liabilities
in the normal course of business. The Company suffered continuing erosion of its
customer  base and  recurring  losses  from  operations  through the date of its
merger with Quality  (August  1997).  Since that date revenues  have  materially
increased while the cost of gearing  production up to the new level of sales has
caused  production  inefficiencies  and losses,  which have  reduced  with time.
Through June 30,  1999,  year-to-date  sales were over $15 million  (double that
recorded in fiscal 1997) with positive cash flow. The Company


                                       6
<PAGE>


continued to gear  production  upward  anticipating  record third quarter sales.
Instead,  the Company  experienced a 30% reduction from its internal sales plan,
leading into its  traditionally  weakest fourth quarter and substantial  losses.
Since the middle of 1997,  management has been building the Company's production
capacity in  anticipation  of the  development of materially  greater volumes of
business.  The unexpected reduction in quarterly volume during the third quarter
of 1999 required management to focus on preserving cash.

     Management  believes that ultimately the Company will need to stabilize its
workforce  and  monthly  production  to capture  the true  production  economies
available  to the Company  from its higher  level of sales.  Management  further
believes that, without a significant infusion of additional working capital, the
Company's  currently  available  cash  reserves  will  prevent the Company  from
availing itself of these  efficiencies  and from  protecting  itself from future
unforeseen downturns, such as those experienced in the last six months of fiscal
1999.  Accordingly,  since mid-November 1999, management has been attempting (i)
to negotiate a  non-conversion  solution to the Reg "S"  Debentures  and (ii) to
raise  additional  capital  financing,  through  financial  institutions  and/or
strategic  investors to solidify and stabilize  the Company's  balance sheet and
thereby its ability to normalize  production.  There is no  assurance  that such
financing  will  be  available  to the  Company  when  needed,  on  commercially
reasonable terms or at all.

     Previously  the  Company  reported  that it had  entered  into a  strategic
investment by a third party through a direct  equity  purchase.  On May 5, 2000,
the Company was notified  that the  investor was  unwilling to move forward with
the strategic investment on the basis originally  contemplated.  The Company has
entered into a non-binding  letter of understanding with another investor and is
working  with such  investor and its lenders to put together a plan to stabilize
production  and  maximize  corporate  value.  There can be no  assurance  that a
strategic  investment will be made. In the event the Company is unable to secure
financing  through a  strategic  investment,  or  otherwise,  the Company may be
materially adversely affected.

     The  financial  statements  do not include any  adjustments  to reflect the
possible future effects on the  recoverability  of assets and  classification of
liabilities that would result from the inability of the Company to continue as a
going concern.

NOTE 3: INVENTORY

     Major inventory components were as follows:

                                           March 31, 2000      December 31, 1999
                                           --------------      -----------------
Raw materials ........................       $4,669,741           $4,027,616
Work in Progress .....................          202,663               80,904
Finished goods .......................        4,170,234            4,637,294
                                             ----------           ----------
                                             $9,042,638           $8,745,814
                                             ==========           ==========

NOTE 4: DEBT

Credit Agreement

     The Company entered into a $15,000,000  credit agreement with IBJ Whitehall
Business Credit Corporation (the "IBJ Credit Facility") as of July 30, 1999. The
IBJ Credit  Facility  consists of a revolving  loan, a term loan,  and a capital
expenditures  loan.  The agreement  terminates on July 30, 2002,  unless earlier
terminated, as provided for in the credit agreement.

     The  revolving  loan  (the  "IBJ  Revolving  Loan")  commitment  amount  is
$12,000,000, subject to certain limitations.  Advances are made by formula based
upon the Company's accounts receivable and inventory  balances.  As of March 31,
2000,  a  total  of  approximately  $8,564,000  of  a  possible  $9,641,000  was
outstanding  under the IBJ Revolving  Loan and was included in line of credit in
the accompanying balance sheets. Interest is calculated at the


                                       7
<PAGE>


prime  rate plus  .75%  (9.75% at March 31,  2000).  The IBJ  Revolving  Loan is
collateralized  by the accounts  receivable and inventory of the Company.  Under
the IBJ Revolving Loan, the Company is required to maintain a lockbox.  Proceeds
from the collection of accounts  receivable are required to be remitted directly
to  this  lockbox  which  is  controlled  by  IBJ  Whitehall   Business   Credit
Corporation.  As such,  the balance of the IBJ Revolving  Loan is reflected as a
short-term   liability   in   these   financial   statements.   The   short-term
classification does not effect the Company's ability to draw additional advances
under the agreement according to the established formula.

     The term  loan  (the  "IBJ  Term  Loan")  has an  original  loan  amount of
approximately  $2,108,000  and is secured by machinery  and  equipment.  Monthly
installments  of $36,459  are due until  maturity,  at which time the  remaining
outstanding  balance is due. As of March 31, 2000, the balance  outstanding  was
approximately $1,852,792.  Interest is calculated at the prime rate plus 1% (10%
at March 31, 2000).

     The capital expenditures loan (the "CapEx Loan") is a secured loan covering
machinery and equipment put into service under a capital expenditure facility of
1999.  The CapEx Loan allows for the  financing of up to  $1,000,000  of capital
expenditures  from  May 1,  1999 at an  advance  rate of 80% of the  cost of the
equipment.   The  original  amount  outstanding  at  closing  was  approximately
$239,000.  As of March 31,  2000,  the  balance  outstanding  was  approximately
$215,755. The CapEx Loan requires monthly payments of 1/72 of each advance, with
any remaining balance due at maturity.  Interest is calculated at the prime rate
plus 1% (10% at March 31, 2000).

     The IBJ Credit  Facility  contains  covenants  which restrict the Company's
ability to declare cash  dividends  and require the Company to maintain  certain
financial  ratios such as fixed  charge  coverage  and a minimum net worth.  The
Company  was  and  continues  to be in  non-compliance  with  certain  financial
covenants  under the IBJ Credit  Facility.  Until such time as the Company is no
longer in  non-compliance  with the  financial  covenants  contained  in the IBJ
Credit  Facility or the IBJ Credit  Facility is amended in a manner to cure such
non-compliance,  IBJ  could  accelerate  the  maturity  date of the  IBJ  Credit
Facility.  Such  acceleration  of the maturity  date of the IBJ Credit  Facility
could have a material adverse effect on the Company.

Convertible Debentures

     The Company obtained additional financing through the sale of 8% Redeemable
Convertible  Debentures  (the "Reg S  Debentures"),  in the aggregate  principal
amount of $2,250,000.  The Reg S Debentures  represent unsecured  obligations of
the Company and must be converted into shares (the  "Conversion  Shares") of the
Company's  common stock at maturity date  (December 31, 2000),  unless they have
been converted earlier at the option of the holder.  The conversion price of the
Reg S Debentures will be equal to 80 percent of the average closing bid price of
the shares of common stock as quoted on the Nasdaq  SmallCap Market for the five
trading days immediately  preceding the date of conversion.  Notwithstanding the
foregoing,  the Company is not  obligated to issue more than 209,660  Conversion
Shares (the "Maximum Conversion Share Allotment").

     The Reg S  Debentures  bear  interest at 8% per annum  (subject to increase
under certain circumstances), payable upon conversion or redemption of the Reg S
Debentures.  Commencing  January 1, 1999, the interest rate increased to 20% per
annum because the underlying  Conversion Shares were not registered with the SEC
before  January 1, 1999.  At such time as the  underlying  shares are  tradable,
without  regard to  registration,  the  interest  rate will revert to the 8% per
annum.  Further,  if upon  conversion of the Reg S Debentures  the Company would
otherwise  be required to issue  shares of common stock in excess of the Maximum
Conversion  Share  Allotment,  the interest  rate on the Reg S Debentures  will,
effective as of the issuance of the Maximum Conversion Share Allotment, increase
to 25% per annum with respect to the unconverted  Reg S Debentures.  The Company
has agreed that if it has not either retired the remaining Reg S Debentures with
accrued  but unpaid  interest  within ten days of the  issuance  of the  Maximum
Conversion  Share  Allotment or filed a proxy statement  soliciting  stockholder
authorization  to  issue   additional   shares  upon  notice  of  conversion  of
outstanding Reg S Debentures in excess of the Maximum Conversion Share Allotment
and/or in lieu of such cash  redemption of the  remaining Reg S Debentures,  the
Company  would pay a penalty equal to the  difference  between the interest rate
paid since inception and 25% on those Reg S Debentures which remain  outstanding
after the  issuance of the Maximum  Share  Allotment.  Such  penalty will not be
applicable if the Company files such proxy as contemplated.


                                       8
<PAGE>


     The Company may redeem the Reg S Debentures at any time, upon 30 days prior
written notice as to redemptions  made, or upon three days notice for redemption
pursuant to (ii) below (a "Redemption  Notice"),  at a redemption price equal to
(i) 125% of the  principal  amount  of,  plus  accrued  interest  on,  the Reg S
Debentures,  or (ii) 100% of the principal amount of , plus accrued interest on,
the Reg S Debentures in the event that the Company shall have issued the Maximum
Conversion  Share  Allotment.  In  addition,  if the  Company  redeems the Reg S
Debentures  any time after the Company has issued the Maximum  Conversion  Share
Allotment,  the  Company  has also  agreed to issue to the  holders of the Reg S
Debentures to be redeemed a number of warrants (the "Redemption Warrants") equal
to one-half of the principal  amount of the Reg S Debentures to be redeemed.  If
issued,  the Redemption  Warrants will be exercisable for a period of five years
from the date of issuance  at an exercise  price equal to either (i) the greater
of (A) $15.00 per share; (B) 115% of the average of the closing bid price of the
Common Stock for the five trading days immediately preceding the Redemption Date
or (ii)in the event that an exercise price under  alternative  (i) is determined
by Nasdaq to be an  issuance  below the then  current  market  price  within the
meaning of NASD Rule  4310(c)(25)(H) (or any successor rule), the exercise price
will be equal to the closing bid price of the Common  Stock on June 30, 1998 and
the number of Warrant Shares  issuable will be subject to adjustment as provided
in the Redemption Warrant. The Redemption  Warrants,  if any, will be redeemable
by the  Company  upon  notice of not less  than 30 days,  at a price of $.05 per
Redemption  Warrant  but only to the  extent  that the  shares of  Common  Stock
underlying  the  Redemption  Warrants  are  transferable  either  pursuant to an
effective  registration  statement or pursuant to Rule 144 of the Securities Act
of 1933,  as amended  (the  "Securities  Act") and the  closing bid price of the
Common Stock on all 15 trading days ending on the day on which the Company gives
notice  has  been at  least  150% of the then  effective  exercise  price of the
Redemption  Warrants.  If issued,  the  Redemption  Warrants will be exercisable
either  on  a  cash  or  cashless  basis  and  the  holders  will  have  certain
registration  rights with  respect to the shares of Common Stock  issuable  upon
exercise of the Redemption Warrants.

     As of March 31,  2000 an  aggregate  of 229,204  principal  amount of Reg S
Debentures  plus  accrued  but  unpaid  interest  thereon  of  $41,035  had been
converted  into  206,324  shares of the  Company's  Common  Stock at an  average
conversion price of $1.265 per share.

     On May 3, 2000 the holders of Reg S Debentures  each delivered a conversion
notice to the Company requesting the conversion of an aggregate principal amount
of $90,000,  and accrued but unpaid interest thereon into approximately  192,948
shares of the Company's Common Stock at an average conversion price, pursuant to
the conversion  rate set forth in the Reg S Debentures,  of $.61 per share.  The
Company  issued an  aggregate  of 3,336  shares to the  converting  holders on a
pro-rata  basis of 1,112 to each such  holder.  Such  shares  in the  aggregate,
represented the remaining shares available for issuance by the Company under the
Maximum Conversion  Allotment.  The Company has likewise notified the holders of
the Reg S Debentures that the Company has contemporaneously with the issuance of
the 3,336 shares  reached the Maximum Share  Allotment.  The Company  intends to
file a proxy statement, pursuant to the terms of the Reg S Debenture, to solicit
shareholder  authorization  for the  issuance of shares in excess of the Maximum
Conversion  Allotment pursuant to further conversion  requests by the holders of
the balance of the Reg S Debentures.

NOTE 5: STOCKHOLDERS' EQUITY

     In February  2000,  the Company  issued an  aggregate  of 49,277  shares of
common stock to certain of the holders of Reg S Debentures  in  connection  with
the  conversion by such holders of an aggregate of $40,000  principal  amount of
Reg S Debentures,  together with accrued and unpaid interest  thereon of $7,195,
at a conversion  rate of $.96 per share.  The issuance of shares of Common Stock
by the  Company  pursuant  to the  conversion  of Reg S  Debentures  was made in
reliance  upon an  exemption  from  registration  under  Section  3(a)(9) of the
Securities Act.

     On March 8, 2000,  the Company  authorized  the issuance of an aggregate of
8,332  shares  of  Common  Stock  to two of its  directors  in  lieu  of  unpaid
director's  fees of an  aggregate  of $12,500.  The  issuances of such shares is
based on a price per share of $1.50 ( the closing  sales price of the  Company's
Common  Stock on March 31,  2000) The  issuances of Common Stock will be made in
reliance upon Section 4(2) of the Securities Act.


                                       9
<PAGE>


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

     The  Private  Securities  Litigation  Reform  Act of 1995  provides a "safe
harbor" for forward-looking  statements.  Certain  information  included in this
Report contains statements that are forward-looking, such as statements relating
to plans for future activities.  Such  forward-looking  statements involve known
and unknown  risks,  uncertainties  and other factors which may cause the actual
results,  performance or achievements of the Company to be materially  different
from any future  results,  performance or  achievements  expressed or implied by
such  forward-looking  statements.  Such  factors  include,  among  others,  the
following:  the Company's recent losses, the Company's need to obtain additional
financing and the ability to obtain such  financing;  outstanding  indebtedness;
the  ability  to hire  and  retain  key  personnel;  successful  completion  and
integration  of  prior  and any  future  acquisitions;  relationships  with  and
dependence on third-party equipment  manufacturers and suppliers;  uncertainties
relating to business  and  economic  conditions  in markets in which the Company
operates; uncertainties relating to government and regulatory policies and other
political risks; uncertainties relating to customer plans and commitments;  cost
of  and  availability  of  component   materials  and  inventories;   effect  of
governmental export and import policies;  the highly competitive  environment in
which the Company operates; potential entry of new, well-capitalized competitors
into the Company's markets; and the uncertainty  regarding the Company's ability
to continue as a going concern as well as it ability,  through sales growth,  to
absorb the  increasing  costs incurred and expected to be incurred in connection
with its  business  activities.  The words  "believe",  "expect",  "anticipate",
"intend" and "plan" and similar expressions identify forward-looking statements.
Readers  are  cautioned  not to place undue  reliance  on these  forward-looking
statements, which speak only as of the date the statement was made.

General

     Since 1997 the Company's  revenues have increased by approximately 100% and
in the  quarter  ended June 30, 1999 the Company  achieved  its first  quarterly
profit in more than five years. Based on these and other factors,  at the end of
the June 30, 1999 quarter management  anticipated  continued revenue growth and,
consequently,  the  Company was hiring and  training  additional  employees  and
incurring  overtime  expenses  in order to keep  production  in line  with  such
anticipated growth.  However,  during the third and fourth quarters of 1999, the
Company experienced an unforeseen substantial decrease in orders from two of its
largest  customers.  Moreover,  business  from a potential new customer that was
expected to occur in the third quarter of 1999 never materialized.  As a result,
the  Company  was  required  to reduce  overhead  expenses  which was  partially
accomplished through reductions in personnel from 475 at June 30, 1999 to 394 at
September 30, 1999.  Management determined it was in the Company's best interest
to stabilize the existing trained workforce and continue  production in order to
build  inventory of its best selling  products in  anticipation of the year 2000
season. In order to finance continued production, the Company secured agreements
from certain  third  parties to allow any monies  raised in the financing of the
Company's real property to support the fourth quarter plan of production and not
to reduce the prior  existing  commitments of the Company to such third parties.
Assurances  to such third  parties were  required that if such monies as funded,
remained in the Company , they would be used to support the fourth  quarter plan
of production and not as an offset to other existing debt. The Company, however,
could not secure  agreement from its lenders to fund the real property and allow
the Company to produce in anticipation of its Year 2000 season.  Accordingly the
Company had no alternative  but to reduce full time employees to 269 by year-end
1999.

     As a result,  management  determined that a strategic investor was required
to stabilize  cash flow and allow the Company to enjoy the  economies of scale a
well financed  company should achieve from the Company's  current level of sales
and  production.  In November  1999,  the Company  commenced  negotiations  with
Satisfied Brake Products  ("Satisfied") with respect to a prospective  strategic
investment by Satisfied in the Company,  although a formal non-binding letter of
intent was not signed until March, 2000. During the intervening time the Company
was forced  into a "lame  duck"  status  within its  industry.  There were views
expressed by customers  and  prospective  customers  ranging from it was a "done
deal" to they  could  not  depend  on the  strategic  investor  ever  completing
satisfactory due diligence. Both industry perspectives were equally damaging. On
more  than  one  occasion,  sales  efforts  by the  Company  were  set  back  as
prospective  customers  eliminated the Company from  consideration on account of
the fact that they were already  considering the Company's strategic investor or
because of concerns for the  Company's  on-going  viability.  Certain  customers
became  concerned  with the  Company's  ability to make it through the year 2000
season; resulting in accelerated orders from such customers.


                                       10
<PAGE>


     The downturn of the third and fourth  quarters of last year reversed itself
in late December 1999. The Company ended the year with a substantial  backlog of
orders.  This trend continued during the first quarter of year 2000 primarily as
a result of the  Company's two largest  customers  more than doubling the normal
amount of orders they typically place during this period.  Since the Company was
not able to prepare for its season by "pre-producing"  its best selling products
during the fourth quarter,  the Company was forced to once again  concentrate on
production at the expense of the bottom line.  Based on established  criteria of
"timeliness  of delivery"  and a required  high  percentage  of order fill,  the
Company was forced to hire and train a substantial  amount of new employees.  At
March 31, 2000, the Company employed 324 full-time employees.  The costs of such
inefficiencies  have had a material  adverse  effect on the Company's  operating
results.  Moreover, in the last half of April 2000, the Company was advised that
both of its  largest  customers  had an  oversupply  of  inventory  and would be
cutting back orders.

     On May 5, 2000,  Satisfied  informed the Company  that it was  unwilling to
move forward with the strategic investment on the basis originally contemplated.
On May 9, 2000 the Company  entered into a non-binding  letter of  understanding
with  another  strategic  investor  and is working  with that  investor  and its
lenders to put together a plan to stabilize  production  and maximize  Corporate
value. There is no assurance that such strategic  investment will take place. In
the event that the  Company is unable to secure  financing  through a  strategic
investment, or otherwise, the Company may be materially adversely affected.

Results of Operations

Comparison  of Three Months Ended March 31, 2000 to Three Months Ended March 31,
1999

     Net  Sales.  Net sales  for the  three  months  ended  March 31,  2000 were
$5,821,715  as compared to net sales of  $7,320,955  for the three  months ended
March 31, 1999.  The decrease of $1,499,240 or 20.5% was primarily  attributable
to  decreased  production  resulting  from delayed raw  material  purchases  and
production  inefficiencies  inherent in the hiring and training of a significant
number of new employees.

     Gross Profit.  For the three months ended March 31, 2000, the Company had a
gross  profit of  $1,044,225  compared to a gross profit of  $2,015,821  for the
three months ended March 31, 1999.  The decrease in gross profit was  attributed
to a 20.5%  decrease in sales plus an increase in cost of sales as a  percentage
of net sales resulting from the  inefficiencies  inherent in hiring and training
substantial numbers of employees. Cost of sales as a percentage of net sales for
the three  months  ended  March 31,  2000 was 82.1% as compared to 72.5% for the
three months ended March 31, 1999.

     Selling,  General  and  Administrative   Expenses.   Selling,  general  and
administrative  expenses  for  the  three  months  ended  March  31,  2000  were
$1,666,451 as compared to $1,752,166  for the three months ended March 31, 1999,
representing a decrease of 4.9%. The decrease was primarily  attributable to the
reduction of sales.

     Interest Expense. Interest expense decreased by $15,028 or 3% from $498,121
for the three months ended March 31, 1999 to $483,093 for the three months ended
March 31, 2000. The nominal decrease in interest expense reflected the fact that
borrowings and interest rates were essentially unchanged from period to period.

     Net Loss. Net loss in the first quarter of 2000 was  ($1,105,319) or ($.86)
per share  based on  1,289,124  weighted  average  common and common  equivalent
shares  outstanding  compared to a net loss of ($234,466) or ($.22) per share in
the first quarter of 1999 based on 1,048,656  weighted average common and common
equivalent  shares  outstanding.  The  increase  in net  loss  of  $858,352  was
primarily the result of decreased  production  resulting  from  inadequate  cash
resources  combined with the operating  inefficiencies  created by the hiring of
additional staff to meet orders received by our largest customers.

Liquidity and Capital Resources

     During the three  months  ended March 31,  2000,  the Company  financed its
operations  primarily through  borrowings under its lending  facilities and cash
generated by operations.


                                       11
<PAGE>


     At March 31, 2000, the Company had consolidated cash totaling $57,798 and a
working  capital  deficit of  $4,862,330.  At December 31, 1999, the Company had
consolidated cash totaling $151,685 and a working capital deficit of $4,131,902.
The  increase  in  working  capital  deficit  was due  primarily  to the (i) the
reduction in cash to fund the Company's  net losses,  (ii) the increase in short
term  debt  obligations  resulting  from  the  reclassification  of  the  Reg  S
Debentures to short term debt,  (iii) the increase in accrued  liabilities,  and
(iv) the  reclassification of certain long term debt pending an amendment to the
IBJ Credit Facility (defined below).

     The principal source of capital for the Company's operations is the line of
credit facility between the Company and IBJ Whitehall, as Agent (the "IBJ Credit
Facility"), which consists of the following:

     (i)  the IBJ  Revolving  Loan  facility of up to $12 million.  Advances are
          made  by  formula  based  on the  Company's  accounts  receivable  and
          inventory  balances.  At March 31, 2000, the revolving credit facility
          had  approximately   $8.564  million  of  a  possible  $9.641  million
          outstanding. Interest is calculated at the prime rate plus .75% (9.75%
          at March 31, 2000)

    (ii)  the IBJ Term Loan, secured by machinery equipment,  having an original
          loan amount of  approximately  $2.108 million of which  $1,852,792 was
          outstanding at March 31, 2000. Monthly installments of $36,459 are due
          until  maturity,  at which time any balance owing is due.  Interest is
          calculated at the prime rate plus 1% (10.0% at March 31, 2000)

    (iii) the CapEx Loan,  secured by machinery  and  equipment put into service
          under a capital  expenditure  facility of 1999.  The CapEx Loan allows
          for the financing of up to $1,000,000 of capital expenditures from May
          1, 1999 at an advance  rate of 80% of the cost of the  equipment.  The
          original amount outstanding at the closing was $238,990.  At March 31,
          2000, the balance  outstanding was  approximately  $215,755.  The loan
          calls for monthly  payments of 1/72 of each  advance  with any balance
          being due at the maturity  date.  Interest is  calculated at the prime
          rate plus 1% (10.0% at March 31, 2000).

     The Company's  obligation to pay the principal of, interest on, premium, if
any,  and all other  amounts  payable on account of the IBJ Credit  Facility  is
secured by the inventory,  accounts  receivables  and machinery and equipment of
the Company, as well as the pledge of all of the Company's ownership interest in
it's principal subsidiary,  Quality Automotive Company. Pursuant to the terms of
the IBJ Credit Facility,  under certain  restrictive  criteria,  the Company may
choose to borrow under a formula  equal to 300 basis points over LIBOR.  The IBJ
Credit  Facility  contains  covenants  which  restrict the Company's  ability to
declare cash  dividends  and require the Company to maintain  certain  financial
ratios such as fixed charge  coverage  and a minimum net worth.  The Company was
and continues to be in noncompliance with certain financial  covenants under the
IBJ  Credit  Facility.   Until  such  time  as  the  Company  is  no  longer  in
non-compliance with the financial covenants contained in the IBJ Credit Facility
or the IBJ Credit  Facility is amended in a manner to cure such  non-compliance,
IBJ  could  accelerate  the  maturity  date of the  IBJ  Credit  Facility.  Such
acceleration  of the  maturity  date of the IBJ  Credit  Facility  could  have a
material adverse effect on the Company.

     In addition to the IBJ Credit  Facility,  the Company  obtained  additional
financing  through  the  sale on June  30,  1998,  of Reg S  Debentures,  in the
aggregate  principal  amount  of  $2,250,000.  The  Reg S  Debentures  represent
unsecured  obligations of the Company and  outstanding  Reg S Debentures must be
converted into shares (the "Conversion Shares") of the Company's Common Stock at
maturity date  (December 31, 2000) unless they have been converted  earlier,  at
the option of the holder.  The conversion  price of the Reg S Debentures will be
equal to 80% of the average  closing bid price of the shares of Common  Stock as
quoted on the Nasdaq SmallCap  Market for the five (5) trading days  immediately
preceding the date of conversion.  Notwithstanding the foregoing, the Company is
not  obligated  to issue  more than  209,660  Conversion  Shares  (the  "Maximum
Conversion Share Allotment") without obtaining approval of its stockholders.

     The Reg S  Debentures  provided  for  interest at 8% per annum  (subject to
increase under certain circumstances),  payable upon conversion or redemption of
the Reg S Debentures, in cash or shares of Common Stock, at the option


                                       12
<PAGE>


of the  Company.  The  interest  rate  increased to 20% per annum for the period
commencing  January  1, 1999  since the  underlying  Conversion  Shares  are not
covered by a  registration  statement  filed  with the SEC.  At such time as the
underlying  shares are tradable,  without regard to  registration,  the interest
rate will revert to the 8% per annum.  Further,  if upon conversion of the Reg S
Debentures the Company would otherwise issue shares of Common Stock in excess of
the  Maximum  Conversion  Share  Allotment,  the  interest  rate  on  the  Reg S
Debentures  will,  effective as of the issuance of the Maximum  Conversion Share
Allotment,  increase  to 25% per annum  with  respect to the  unconverted  Reg S
Debentures.  The  Company  has  agreed  that if it has not  either  retired  the
remaining Reg S Debentures with accrued but unpaid interest within ten (10) days
of the  issuance of the Maximum  Conversion  Share  Allotment  or issued a proxy
statement  soliciting  stockholder  authorization to issue additional  shares in
lieu of such cash  redemption of the  remaining  Reg S  Debentures,  the Company
would pay a penalty equal to the difference between the interest rate paid since
inception and 25% on those Reg S Debentures which remain  outstanding  after the
issuance of the Maximum Share Allotment.  Such penalty will not be applicable if
the Company issues the proxy statement referred to above.

Impact of the Year 2000

     As of May 12, 2000, the Company has not  experienced  any Year 2000 effect,
from either its own, or its customer's computing systems.


                                       13
<PAGE>


                                     PART II
                                OTHER INFORMATION

ITEM 1: LEGAL PROCEEDINGS

     On August 21, 1998, an eight count complaint,  entitled Al Dulisse, Bernard
Bard, Michael Scicchitano and Barry Schwartz vs. U.S. Automotive  Manufacturing,
Inc., f/k/a R.T.  Industries,  Inc., a Delaware  corporation (Case No. 98-007490
AN),  was  filed in the  Circuit  Court of the  Fifteenth  Judicial  Circuit  of
Florida,  in and for Palm  Beach  County  (the  "Complaint")  alleging  that the
Company  failed  to  recognize  stock  options  purportedly  exercised  by  each
plaintiff under alleged stock option agreements with the Company's  predecessor,
R.T.  Industries,  Inc. The Complaint  contained a breach of contract  claim and
unpaid-wages  claim for each of the four  plaintiffs;  however on  November  23,
1998,  the  Court  entered  an  order  dismissing  with  prejudice  all  of  the
unpaid-wages  claims.  A jury trial on the breach of contract claims was held in
January 2000 and a verdict was rendered in favor of the Company. The plaintiffs'
motions for partial  judgement  notwithstanding  the verdict and for a new trial
were denied at a subsequent  hearing.  A final  judgement in this matter has not
been entered.  The Company has filed motions with respect to collecting  certain
costs and fees associated with this proceeding, which were scheduled for hearing
on April 24, 2000.  Prior to such hearing the parties  agreed  orally to end the
subject  litigation  with  prejudice,  without  payment from either  party.  The
Company expects to have a formal settlement  agreement  incorporating the intent
of the parties in the near future.

     Various other legal proceedings and claims have been or may be from time to
time  asserted  against  the  Company in the  ordinary  course of its  business.
Management believes that it has meritorious  defenses and will vigorously defend
itself with respect to all existing  proceedings or claims. Any costs or damages
that management estimates may be paid as a result of these proceedings or claims
are accrued when the  liability,  if any, is considered  probable and the amount
can be reasonably  estimated.  Although the ultimate  disposition of proceedings
and claims currently pending is not presently determinable,  management believes
that,  after  consultation  with counsel,  the likelihood that material costs or
damages  will be incurred by the Company as a result of any pending  proceedings
is remote.

ITEM 2: CHANGES IN SECURITIES AND USE OF PROCEEDS

     In February  2000,  the Company  issued an  aggregate  of 49,277  shares of
common stock to certain of the holders of Reg S Debentures  in  connection  with
the  conversion by such holders of an aggregate of $40,000  principal  amount of
Reg S Debentures,  together with accrued and unpaid interest  thereon of $7,195,
at a conversion  rate of $.96 per share.  The issuance of shares of Common Stock
by the  Company  pursuant  to the  conversion  of Reg S  Debentures  was made in
reliance  upon an  exemption  from  registration  under  Section  3(a)(9) of the
Securities Act of 1933, as amended (the "Securities Act").

     On March 8, 2000,  the Company  authorized  the issuance of an aggregate of
8,332  shares  of  Common  Stock  to two of its  directors  in  lieu  of  unpaid
director's  fees of an  aggregate  of $12,500.  The  issuances of such shares is
based on a price per share of $1.50 (the  closing  sales price of the  Company's
Common Stock on March 31,  2000).  The issuances of Common Stock will be made in
reliance upon Section 4(2) of the Securities Act.

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

     There were no matters submitted for a vote of securities holders during the
first quarter of 2000.

ITEM 5: OTHER INFORMATION

     In May 2000,  Nasdaq informed the Company that, among other things,  it was
not in  compliance  with the new net  tangible  asset/market  capitalization/net
income  requirements for continued  listing on the Nasdaq SmallCap  Market.  The
Company is in the process of responding to such notice.  If such response is not
accepted by Nasdaq,  it may  commence  proceedings  to delist the  Company  from
Nasdaq. If the Company is delisted, the Company's


                                       14
<PAGE>


common stock may commence  trading on the OTC Bulletin  Board. In such event, it
may become more  difficult to buy or sell the  Company's  Common Stock or obtain
timely and accurate quotations to buy or sell. In addition,  the delisting could
result in a decline in the trading  market for the Company's  common stock which
could potentially further depress the Company's stock price.

ITEM 6: EXHIBITS AND REPORTS ON FORM 8-K

     (a)  Exhibits

          27   Financial Data Schedule

     (b)  Form 8-K

          None.


                                       15
<PAGE>


                                   SIGNATURES

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

          Dated: May 17, 2000

                                       U.S. AUTOMOTIVE MANUFACTURING, INC.
                                   By: /s/       John W. Kohut
                                         -------------------------------------
                                            John W. Kohut,
                                            Chairman of the Board  and
                                            principal financial officer




                                       16