Allied Holdings Reports Successful Renewal of Teamsters Contract in Eastern Canada

DECATUR, Ga., March 24 -- Allied Holdings, Inc. (AMEX:AHI) announced today that its subsidiary, Allied Systems (Canada) Company, has successfully negotiated the renewal of its contract with its employees represented by the Teamsters Union in Eastern Canada. Allied Systems (Canada) Company and the Teamsters Union in Eastern Canada have been operating under a contract that expired on October 31, 2002. The new contract, which was ratified by the Teamsters in Eastern Canada on March 23, 2003, will expire on October 31, 2005. The contract covers the drivers, mechanics and yard personnel represented by the Teamsters Union in the provinces of Ontario and Quebec, and represents approximately 70% of Allied Holdings employees in Canada.

Economic provisions of the new agreement include a wage freeze for the first two years of the agreement and a freeze on the current health and welfare contributions of Allied Systems (Canada) Company during the three-year term of the agreement.

Allied Systems (Canada) Company has also agreed to increase pension contributions in each year of the agreement and to increase wages two percent effective November 1, 2004 and an additional one percent effective May 1, 2005. The additional pension contributions will increase costs approximately $100,000 or 0.2 percent in year one of the agreement, and approximately $280,000 or 0.6 percent in year two of the agreement. The wage and pension increases in year three of the agreement will increase costs approximately $1.6 million or 3.2 percent of costs.

In a related matter, in the event that the International Brotherhood of Teamsters (IBT) and the company were to agree to wage increases in the first two years of a new contract in the United States, Allied's new agreement in Canada also provides that the wages in each of the first two years will be increased by an amount equivalent to the negotiated percentage increases in the United States. Allied's current agreement with the IBT in the United States expires on May 31, 2003.

Hugh E. Sawyer, Allied Holdings President and Chief Executive Officer, said "I am pleased that we were able to negotiate a satisfactory agreement with our employees in eastern Canada that allows wage and benefit stability for the next two years and, appropriate increases in the third year. Our employees in eastern Canada have taken important and courageous steps to build a more competitive and stable Allied. This new agreement should ultimately benefit all of our key constituents including our customers, shareholders, lenders and employees."

Statements in this press release that are not strictly historical are "forward looking" statements. Such statements include, without limitations, any statements containing the words "believe," "anticipate," "estimate," "expect," "intend," "plan," "seek," and similar expressions. Investors are cautioned that such statements, including statements regarding increases in wage and pension contributions, the benefits resulting from the renewal of the contract with the Teamsters in Eastern Canada, the ability of the Company to successfully negotiate its Teamsters Contract in the United States on terms favorable to the Company, improvement of the Company's operating performance, the ability of the Company to execute key initiatives, the ability of the Company to increase sales growth in AAG and Axis, and the amount of capital expenditures for 2003, are subject to certain risks and uncertainties that could cause actual results to differ materially. Without limitation, these risks and uncertainties include economic recessions or extended or more severe downturns in new vehicle production or sales, the ability of the Company to seek economic flexibility from the Teamsters Union representing U.S. employees, the highly competitive nature of the automotive distribution industry, the ability of the Company to comply with the terms of its current debt agreements, the ability of the Company to obtain financing in the future and the Company's highly leveraged financial position. Investors are urged to carefully review and consider the various disclosures made by the Company in this press release and in the Company's reports filed with the Securities and Exchange Commission.

NOTE: For additional information about Allied, please visit our website at www.alliedholdings.com .