---

First Quarter Earnings Per Share Increase 25%

14 May 1999

First Quarter Earnings Per Share Increase 25%

    PHILADELPHIA--May 13, 1999--The Pep Boys-Manny, Moe & Jack , the nation's leading automotive aftermarket retail and service chain, announced record sales and a 25% increase in earnings per share for the thirteen weeks ended May 1, 1999.

    Operating Results

    First Quarter
    Sales

    Sales for the quarter ended May 1, 1999, rose to a record $598,316,000, 2.4% greater than the $584,224,000 recorded last year when the Company operated 709 stores as compared to the current total of 645. Service labor revenue, exclusive of installed product, climbed to a record $109,618,000, 9.0% greater than the $100,588,000 recorded last year.
    Comparable store sales increased 6.0% during the quarter while comparable service labor revenue and comparable tire sales increased 4.5% and 8.5%, respectively. The current year increase in comparable service labor revenue of 4.5% was negatively impacted by the challenging prior year comparison of 15.2%.
    Service labor revenue, exclusive of installed product, and tires accounted for 18.3% and 14.9%, respectively, of total sales.

    Earnings

    Net earnings for the period were $10,093,000 ($.20 per share - basic and diluted) as compared to the $10,058,000 ($.16 per share - basic and diluted) that was earned last year. The calculation of earnings per share was impacted by the Company's repurchase of 11,276,698 common shares at a price of $16.00 per share on February 1, 1999.

    Store Expansion Program

    Seven new Supercenters, which feature 12 service bays, were opened during the quarter. The new Supercenters are in Saginaw, MI, Los Angeles, CA, San Sebastian, PR, Hempstead, NY, Harrison-burg, VA, Parsippany, NJ and Bloomington, IN.
    As of May 1, 1999, Pep Boys operated 645 stores, including 6,692 service bays, in 37 states and Puerto Rico. The Company anticipates opening as many as 18 Supercenters, all of which will be funded out of working capital, during the balance of the fiscal year.

    Commentary

    Pep Boys' CEO, Mitchell G. Leibovitz, made the following comments:

    "We are pleased to report an improvement in first quarter earnings per share. A return to normalized merchandise replenishment resulted in higher retail margins and tire margins continued to improve. In addition, commercial delivery (wholesale) margins rose significantly over the course of the quarter as we took steps to maximize the profitability of the program.
    "During fiscal 1998, we took a number of steps to reposition Pep Boys in order to better allocate our assets and enhance our prospects for sustained growth in a rapidly changing automotive aftermarket. Those initiatives included a $128 million reduction in inventory, a $116 million reduction in capital spending, the successful rollout of a commercial delivery program and the sale of 103 and closure of 12 non-service/non-tire Express stores. We culminated the year by utilizing the $108 million from that sale to help fund the repurchase of 17.7% of our outstanding shares at $16.00 per share.
    "With the transitional year behind us and earnings visibility upon us, we begin the second quarter with solid margins, improving sales, controlled expenses and flat inventory levels. As a result, we're optimistic about our prospects for the balance of fiscal 1999 and beyond."

                    Pep Boys Financial Highlights

                         Thirteen          Thirteen
                        Weeks Ended       Weeks Ended         %
                        May 1, 1999       May 2, 1998      Change

Total Revenues       $  598,316,000     $  584,224,000      + 2.4

Net Earnings         $   10,093,000     $   10,058,000      +  .3

Average Shares-Diluted   50,763,000         61,776,000     - 17.8

Basic Earnings Per Share     $  .20             $  .16       25.0

Diluted Earnings Per Share   $  .20             $  .16     + 25.0

    Note: Certain statements made herein are forward-looking which involve risks and uncertainties. The Company's actual results may differ materially from the results discussed in the forward-looking statements due to factors beyond the control of the Company, including the strength of the national and regional economies and consumers' ability to spend, the health of the various sectors of the market that the Company serves, the weather in geographical regions with a high concentration of the Company's stores, competitive pricing, location and number of competitors' stores, product costs and the ability to enhance the profitability of the commercial delivery program. Further factors that might cause such a difference include, but are not limited to, the factors described in the Company's filings with the Securities and Exchange Commission.