EXHIBIT 99.1

HOMETOWN AUTO RETAILERS ANNOUNCES SETTLEMENT OF LITIGATION MATTERS

WATERTOWN, CONN. - DECEMBER 7, 2004 - Hometown Auto Retailers, Inc. (OTC BB:
HCAR) today announced that it has resolved in principle to settle the litigation
matters described in Footnote 9 in the Notes to Unaudited Consolidated Financial
Statements as contained in Hometown's most recent Form 10-Q as filed with the
Securities and Exchange Commission on November 12, 2004. It has reached an
agreement in principle to settle all claims made by Salvatore A. Vergopia and
Edward A. Vergopia, former directors and executive officers of the Corporation,
and Janet Vergopia, the wife of Salvatore A. Vergopia (the "Vergopias") as well
as its related insurance coverage litigation with Universal Underwriters Group
and The Chubb Group of Insurance Companies at a net cost to Hometown of $600,000
after insurance company payments. The settlement with the Vergopias and the
insurers is subject to the execution of a settlement agreement which will
include but not be limited to the execution of mutual releases, the transfer to
the Vergopias of certain Westwood Lincoln Mercury Sales, Inc. assets, the
transfer to the Vergopias of the Westwood Lincoln Mercury franchise subject to
manufacturer approval, the termination of Hometown's Westwood, New Jersey lease,
and the receipt by Hometown of all of Hometown's shares owned by the Vergopias.
Hometown has also successfully defended the claim made for indemnification by
Hometown's former counsel and assistant secretary as the Court has held that
Hometown has no obligation to indemnify its former counsel.

In a separate matter, Hometown has also fully resolved the litigation concerning
the lease for property in Morristown, New Jersey formerly used by Hometown's
subsidiary Morristown Auto Sales, Inc., including all claims among the landlord,
Morristown and Crestmont M.M., L.P., the assignee of the lease agreement. The
cost to Hometown is $150,000 with $75,000 payable immediately and the balance
payable in six equal monthly installments commencing January 1, 2005.

The settlement of the claims as previously described will, in the aggregate,
have minimal effect upon Hometown's results of operations due to reserves
previously established for these contingencies by Hometown on its financial
statements.

                                 ABOUT HOMETOWN

Hometown Auto Retailers (www.htauto.com) sells new and used cars and light
trucks, provides maintenance and repair services, sells replacement parts and
provides related financing, insurance and service contracts through nine
franchised dealerships located in New Jersey, New York, Connecticut,
Massachusetts and Vermont. The company's dealerships offer nine American and
Asian automotive brands, including Chevrolet, Chrysler, Dodge, Ford, Jeep,
Lincoln, Mazda, Mercury, and Toyota. Hometown is also active in two "niche"
segments of the automotive market: the sale of Lincoln Town Cars and limousines
to livery car and livery fleet operators and the maintenance and repair of cars
and trucks at a Ford and Lincoln Mercury factory authorized free-standing
service center.

This release contains "forward-looking statements" based on current expectations
but involving known and unknown risks and uncertainties. Actual results or
achievements may be materially different from those expressed or implied. The
company's plans and objectives are based on assumptions involving judgments with
respect to future economic, competitive and market conditions, its ability to
consummate, and the timing of acquisitions and future business decisions, all of
which are difficult or impossible to predict accurately and many of which are
beyond the control of the company. Therefore, there can be no assurance that any
forward-looking statement will prove to be accurate.