Struggling Allied Holdings considers logistics group sale

DECATUR, Ga. (Aug. 7, 2001) — Allied Holdings, the largest hauler of finished automobiles in North America, is considering the sale of its Axis logistics group.

The company, which operates in Canada through its Allied System subsidiary, said it has engaged Bear, Stearns & Co. to explore the potential divestiture.

Axis, with $28.5 million US in revenues in 2000, began operations in 1996 and has grown to become one of the largest non-asset-based service providers to the finished vehicle logistics services market, primarily through the use of non-union labor. Its services include logistics management, vehicle inspections, the removal/installation of exterior protective coatings, mechanical adjustments and repairs, and port processing operations for international OEMs, including vehicle badging and air conditioner and wind deflector installation.

Struggling with high costs and overcapacity, on Aug. 1 Allied Holdings cut 50 office jobs at its Decatur, Ga., headquarters. Earlier this year, the company laid off 1100 drivers, mechanics, and yard personnel.

The company also said it will charge an administrative processing fee for all vehicles transported for each client, which will increase the total price by 8.5%. The company will start charging the fee Monday in 85% of its business, it said.