Exhibit 99.1

     Hometown Auto Retailers Announces Receipt of Notice of Commencement of
  Lawsuit Against It and Indefinite Delay in Mailing of Information Statement
                              to its Shareholders

WATERBURY, Conn. - July 8, 2005 - Hometown Auto Retailers, Inc. (OTC BB: HCAR)
today announced that it has been notified that three shareholders have commenced
a purported individual, class and derivative action in the Court of Chancery of
the State of Delaware.

Among other remedies, plaintiffs in the Delaware legal action seek to enjoin the
consummation of the exchanges that were announced by the company on June 2,
2005. Such exchanges would, if consummated, result in the transfer of the assets
and liabilities of the company's New England subsidiaries, plus $5 million in
cash (subject to adjustment for fluctuations in the value of certain assets and
liabilities of the New England subsidiaries), to a group of shareholders of the
company, which includes the company's president and chief executive officer, in
exchange for all of the outstanding shares of stock of the Company that are
owned by such shareholders. While the company believes that the claims of the
plaintiffs in the Delaware legal action are without merit, it is unable to
predict what effect, if any, the pendency of the lawsuit will have upon the
proposed exchanges, including the company's ability to borrow the moneys that
are needed to consummate the proposed exchanges.

The company also announced that the staff of the United States Securities and
Exchange Commission have asked the company to delay sending the information
statement describing the proposed exchanges to its shareholders pending the
resolution of certain issues that had been raised by the staff with respect to
the company's annual report on Form 10-K for the period ended December 31, 2004
and its quarterly report on Form 10-Q for the period ended March 31, 2005.

In light of the request of the staff of the SEC to delay the mailing of the
information statement, which the company intends to honor, the potential adverse
effects which the commencement of the Delaware litigation may have upon the
company and the proposed exchanges, as well as a variety of other factors, the
company is unable to predict when it will send the information statement
concerning the proposed exchanges to its shareholders or when the proposed
exchanges will be consummated.

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 franchised
dealerships located in the northeastern United States.

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.