<PAGE>
                                                                    EXHIBIT 10.9

                              EMPLOYMENT AGREEMENT

      THIS EMPLOYMENT AGREEMENT is made and entered into as of the 4th day of
March, 2002, to be effective as of the 4th day of Mach, 2002 (the "Effective
Date"), by and between DAVID RAWDEN ("Employee") and ALLIED HOLDINGS, INC., a
Georgia corporation ("Employer").

                                   WITNESSETH:

      WHEREAS, Employer, through the Affiliates (as hereinafter defined), is
engaged in the transportation of automobiles and light trucks from the
manufacturer to retailers and others, including nontraditional car haulers
involved in the vehicle distribution process and providing logistics and
distribution services to the new and used vehicle distribution market and other
segments of the automotive industry (the "Business");

      WHEREAS, Employee has management skills of which Employer desires to avail
itself; and

      WHEREAS, Employer and Employee deem it to their respective best interest
to outline the duties and obligations, each to the other, by executing this
Employment Agreement,

      NOW, THEREFORE, for and in consideration of the covenants and conditions
hereinafter set forth, and other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, Employer and Employee hereby
mutually agree as follows:

      1.    DEFINITIONS.

            (a)   "Affiliate" means Axis Group, Inc., Allied Automotive Group,
                  Inc., Allied Systems (Canada) Company, Allied Systems, Ltd.
                  (L.P.), Transport Support, Inc., F. J. Boutell Driveaway Co.,
                  Inc., Allied Freight Brokers, Inc. or QAT, Inc.

            (b)   "Base Salary" means the annual salary payable, and as
                  adjusted, pursuant to Paragraph 4.

            (c)   "Cause" means (i) the commission by Employee of an act of
                  fraud, misappropriation, dishonesty, embezzlement, gross
                  negligence, or willful misconduct or unethical conduct in
                  connection with Employee's employment hereunder; (ii) criminal
                  conduct of Employee which results in a felony conviction of
                  such Employee, or the Employee's offering a plea of nolo
                  contendre to a felony; (iii) Employee's continuing and/or
                  willful failure to perform Employee's duties or obligations
                  for Employer as outlined in this Agreement, or Employee's
                  breach of this Agreement; (iv) Employee's prolonged
<PAGE>
                  absence, without the consent of Employer, other than as a
                  result of Employee's Disability or permitted absence or
                  vacation, which is not cured within ten (10) days after
                  written notice from Employer's Board of Directors thereof; (v)
                  engaging in activities prohibited by Paragraphs 11, 12, 13, 14
                  or 15 hereof; (vi) engaging in any activity which could
                  constitute grounds for termination for cause by Employer or
                  any of its subsidiaries or affiliates; or (vii) Employee
                  engaging in conduct that is materially detrimental to the
                  reputation, character or standing of Employer.

            (d)   "Disability", with respect to Employee, shall conclusively be
                  deemed to have occurred (i) if Employee shall be receiving
                  payments pursuant to a policy of long-term disability income
                  insurance; or (ii) if Employee shall have no disability income
                  coverage then in force, then if any insurance company insuring
                  Employee's life shall agree to waive the premiums due on such
                  policy pursuant to a disability waiver of premium provision in
                  the contract of life insurance; or (iii) if Employee shall
                  have no disability waiver of premium provision in any contract
                  of life insurance, then if Employee shall be receiving
                  disability benefits from or through the Social Security
                  Administration; provided, however, that in the event
                  Employee's disability shall, otherwise and in good faith, come
                  into question (and, for purposes of this provision,
                  "disability" shall mean the permanent and continuous inability
                  of Employee to perform substantially all of the duties being
                  performed immediately prior to Employee's disability coming
                  into question) for a period of not less than one hundred
                  twenty (120) consecutive days, and a dispute shall arise with
                  respect thereto, then Employee (or Employee's personal
                  representatives) shall appoint a medical doctor, Employer
                  shall appoint a medical doctor, and said two (2) doctors
                  shall, in turn, appoint a third party medical doctor who shall
                  examine Employee to determine the question of disability and
                  whose determination shall be binding upon all parties to this
                  Agreement. All such medical doctors shall be duly licensed in
                  the State of Georgia.

            (e)   "Restricted Period" means the period commencing as of the date
                  hereof and ending on that date twelve (12) months after the
                  termination of Employee's employment with Employer for any
                  reason, whether voluntary or involuntary.

      2. TERM. Subject to the provisions hereinafter set forth, the term of this
Agreement shall commence as of the Effective Date and shall expire one year
after the Effective Date (the "Initial Term") and shall extend for additional
terms of one (1) year (the "Renewal Term") unless either party gives written
notice of termination not less


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(90) days prior to the end of a Term. As used herein, "Term" shall mean the then
current Initial Term or Renewal Term, as the case may be.

      3. DUTIES.

            (a)   Employee shall, during the Term, serve as Senior Vice
                  President of Business Process Engineering of Employer having
                  duties, responsibilities, powers and authority which are
                  consistent with senior management positions of like
                  designation generally, but subject to the direction of the
                  President and Chief Executive Officer of Allied Holdings, Inc.
                  The Employee shall perform such executive, managerial and
                  administrative duties as the President and Chief Executive
                  Officer of Allied Holdings, Inc. may, from time to time,
                  reasonably request. Employee shall not be required to
                  permanently relocate outside the metropolitan Atlanta, Georgia
                  area.

            (b)   During the Term, Employee shall devote substantially all of
                  Employee's business time, energy and skill to performing the
                  duties of Employee's employment (vacations as provided
                  hereunder and reasonable absences because of illness
                  excepted), shall faithfully and industriously perform such
                  duties, and shall use Employee's best efforts to follow and
                  implement all management policies and decisions of Employer.
                  Employee shall not become personally involved in the
                  management or operations of any other company, partnership,
                  proprietorship or other entity, other than any Affiliate,
                  without the prior written consent of Employer; provided,
                  however, that so long as it does not interfere with Employee's
                  employment hereunder, Employee may (i) serve as a director,
                  officer or partner in a company that does not compete with the
                  Business of Employer and the Affiliates so long as the
                  aggregate amount of time spent by Employee in all such
                  capacities shall not exceed twenty (20) hours per month, and
                  (ii) serve as an officer or director of, or otherwise
                  participate in, educational, welfare, social, religious,
                  civic, trade and industry-related organizations.

      4. BASE SALARY. For and in consideration of the services to be rendered by
Employee pursuant to this Agreement, Employer shall pay to Employee, for each
year during the Term, an annual salary of Three Hundred Thirty Thousand Dollars
($330,000.00) (the "Base Salary"), in installments in accordance with Employer's
payroll practices. Employee's salary shall be reviewed by the Board of Directors
of Employer annually and may be increased, but not decreased, at the sole
discretion of the Board.


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      5. BONUS COMPENSATION.

            (a)   Employee shall be eligible to participate in Employer's bonus
                  plan which will allow annual bonus target in an amount to be
                  determined by the President and Chief Executive Officer.
                  Notwithstanding the foregoing, Employer shall pay to Employee
                  a guaranteed bonus payout in the amount of $75,000 on or
                  before March 22, 2002, with such amount to be credited against
                  any bonus which may be due Employee for the year ending
                  December 31, 2001, and Employer shall pay to Employee a
                  guaranteed bonus in the amount of $49,000 on or before March
                  22 2003, with such amount to be credited against any bonus
                  which may be due Employee for the year ending December 31,
                  2002.

            (b)   Employee shall be entitled to participate in all long term
                  incentive plans, including the amended and restated long term
                  incentive plan and similar plans as are now or hereafter
                  provided by Employer or its Affiliates in accordance with the
                  terms of such plans and consistent with persons serving in a
                  senior management capacity.

      6. OTHER BENEFITS. During the Term, Employer shall provide the following
benefits to Employee:

            (a)   Employee and Employee's immediate family shall be entitled to
                  participate in all group benefit programs, including, without
                  limitation, medical and hospitalization benefit programs,
                  dental care, life insurance or other group benefit plans of
                  Employer as are now or hereafter provided by Employer or any
                  Affiliate, in each case in accordance with the terms and
                  conditions of each such plan;

            (b)   Employer shall provide Employee with the use of an automobile,
                  which shall be comparable to automobiles Employer provides to
                  persons serving in the capacity of Senior Vice President of
                  Employer, or, in the alternative, at the election of Employer,
                  Employer shall provide a monthly car allowance to Employee in
                  the amount of &700.00 per month; and

            (c)   Employee shall be reimbursed for actual, reasonable, ordinary
                  and necessary business expenses incurred in the performance of
                  Employee's duties hereunder. Employee shall be reimbursed for
                  such expenses upon presentation and approval of expense
                  statements or written vouchers or other supporting documents
                  as may be reasonably requested in advance by Employer and in
                  accordance with Employer's practices in effect from time to
                  time.


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            (d)   Employee shall be provided with the use of a cellular
                  telephone, at no cost to Employee.

            (e)   Employer shall reimburse Employee up to Forty-Two Thousand
                  Dollars ($42,000) for temporary living expenses incurred by
                  Employee in the first year following the Effective Date upon
                  the presentation of such documents or other supporting
                  evidence as may reasonably be requested by Employer.

            (f)   To the extent not used for living expenses in the second year
                  following the Effective Date, Employer shall reimburse
                  Employee for up to Sixty Thousand Dollars ($60,000) for actual
                  and reasonable expenses incurred by Employee in relocating to
                  metropolitan Atlanta, GA, including actual moving costs,
                  customary real estate commissions or closing costs incurred in
                  selling Employee's residence in metropolitan Detroit,
                  Michigan. Employee shall be reimbursed for such expenses upon
                  presentation and approval of expense statements or written
                  vouchers or other supporting documents as may be reasonably
                  requested in advance by Employer which approval shall not be
                  unreasonably withheld or delayed; and

            (g)   Employer shall pay to Employee an additional payment (the
                  "Gross-Up Payment") in an amount sufficient to fully reimburse
                  Employee with respect to all federal, state and local taxes
                  actually paid by Employee with respect to the payment set
                  forth in clause (f) hereof to the extent the payment
                  represents reimbursement for actual and reasonable relocation
                  expenses. The Gross-Up Payment shall not be unreasonably
                  withheld or delayed by Employer.

      7. VACATION. Employee shall receive no fewer than three (3) weeks paid
vacation for each year during the Term. Scheduling of vacation shall be subject
to the prior approval of Employer (which approval shall not be unreasonably
withheld). Vacation time shall not accrue, and in the event any vacation time
for any year shall not be used by Employee prior to the end of such year or
prior to termination of employment, it shall be forfeited.

      8. TERMINATION. Anything herein to the contrary notwithstanding,
Employee's employment hereunder shall terminate upon the first to occur of any
of the following events:

            (a)   Employee's Disability; or

            (b)   Employee's death; or


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            (c)   Employer or Employee terminating Employee's employment without
                  Cause hereunder prior to expiration of the Term or ten (10)
                  days prior written notice; or

            (d)   Employee being terminated for Cause; or

            (e)   Employer filing a petition for protection or relief from
                  creditors under the Federal Bankruptcy Law, or any petition
                  shall be filed against Employer under the Federal Bankruptcy
                  Law, or Employer shall admit in writing its inability to pay
                  its debts or shall make an assignment for the benefit of
                  creditors, or a petition or application for the appointment of
                  a receiver or liquidator or custodian of Employer is filed, or
                  Employer shall seek a composition with creditors.

            (f)   Any material change by Employer in Employee's function,
                  duties, and responsibility, from the position and attributes
                  described in Paragraph 3 hereof, unless agreed to by Employee,
                  or any requirement that Employee perform substantially all of
                  his duties outside the metropolitan Atlanta, Georgia area,
                  provided however that Employee's office shall continue to be
                  located in the metropolitan Detroit, Michigan area until such
                  time as he has relocated his residence to the state of
                  Georgia.

      9. SEVERANCE BENEFITS.

            (a)   In the event Employee's employment is terminated (1) by
                  Employer without Cause pursuant to Paragraph 8(c) hereunder,
                  (2) pursuant to Section 8(e), (3) pursuant to Section 8(f) (4)
                  because Employer elects not to renew this Agreement beyond the
                  Initial Term or any Renewal Term, or (5) by Employer within
                  one (1) year following any "change of control" of Employer for
                  any reason other than a conviction involving a felony,
                  Employee shall be entitled to severance benefits in an amount
                  equal to the greater of (i) fifty-two (52) weeks of Base
                  Salary, or (ii) the severance amount due to Employee in
                  accordance with the severance plan or guidelines of Employer
                  in effect on the date of termination. For purposes of this
                  Agreement, change of control shall mean any change in control
                  or ownership whereby Employer is reorganized, merged, or
                  consolidated with one or more corporations as a result of
                  which the owners of all of the outstanding shares of common
                  stock immediately prior to such reorganization, merger or
                  consolidation own in the aggregate less than seventy percent
                  (70%) of the outstanding shares of common stock of the
                  Employer or any other entity into which Employer shall be
                  merged or consolidated immediately following the consummation
                  thereof (hereinafter,


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<PAGE>
                  "Employer's successor-in-interest"), or (ii) the sale,
                  transfer or other disposition of all or substantially all of
                  the assets or more than thirty percent (30%) of the then
                  outstanding shares of common stock of Employer is effectuated,
                  other than as a result of a merger or other combination of
                  Employer and an Affiliate, or (iii) the acquisition by any
                  "person" as used for purposes of Section 13(d) or 14(d) of the
                  Securities Exchange Act of 1934 of beneficial ownership
                  (within the meaning of Rule 13d-3 promulgated under the
                  Exchange Act) of twenty percent (20%) or more of the combined
                  voting power of Employer's then outstanding voting securities
                  is effectuated; or (iv) the individuals who, as of the date of
                  execution of this Agreement, are members of the Board of
                  Directors (the "Incumbent Board") cease for any reason to
                  constitute at least two-thirds (2/3) of the Board; provided,
                  however, that if the election, or nomination for election by
                  the shareholders of any new director was approved by a vote of
                  at least two-thirds (2/3) of the Incumbent Board, such new
                  director shall, for purposes of this Agreement, be considered
                  as a member of the Incumbent Board.

            (b)   In the event Employee's employment is terminated (1) by
                  Employer without Cause pursuant to 8(c), (2) pursuant to
                  Section 8(e), (3) pursuant to Section 8(f), (4) because
                  Employer elects not to renew this Agreement upon the
                  expiration of the Initial Term or any Renewal Term, or (5) by
                  Employer within one (1) year following any "change of control"
                  of Employer for any reason other than a conviction involving a
                  felony, Employee shall be entitled to continue medical and
                  dental coverage as in effect on the last day of employment.
                  Employer shall provide coverage until the last day severance
                  payments are due under this Agreement by paying Employee's
                  COBRA premiums for Employee and covered dependents (if any).
                  At the end of Employee's Severance Period, Employee (and
                  Employee's covered dependents, if any) may elect continuation
                  of insurance coverage for the remainder of the 18-month COBRA
                  period by paying the COBRA premium rate. Continuation coverage
                  will terminate in the event Employee becomes covered under any
                  other group health plan (as an employee or otherwise), unless
                  the new group health plan contains any exclusions or
                  limitations with respect to any pre-existing condition
                  Employee or covered dependent(s) may have. Employee must
                  notify the Employer promptly should Employee become covered
                  under any other plan.

            (c)   If employment is terminated for any reason other than (1) by
                  Employer without Cause, (2) pursuant to Section 8(e), (3)
                  pursuant to Section 8(f), (4) because Employer elects not to
                  renew this Agreement beyond the Initial Term or any Renewal
                  Term, or (5) by


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<PAGE>
                  Employer within one (1) year following any "change of control"
                  of Employer for any reason other than a conviction involving a
                  felony, no severance benefits shall be due to Employee;

            (d)   Severance payments shall include the car allowance provided
                  for under this Agreement in addition to the benefits listed
                  above.

            (e)   Employer will provide Employee with a six-month individual
                  program of professional outplacement services.

            (f)   Notwithstanding the foregoing, the severance payments due from
                  the Employer to the Employee pursuant to this Agreement
                  including the benefits under section 9(a) and section 9(b)
                  shall be mitigated and reduced by the amount of any
                  consideration paid to Employee by any other person or entity
                  for services rendered following the date of termination of
                  employment, regardless of how such compensation is
                  characterized, including, but not limited to, consulting fees
                  or other fees for any services rendered by Employee. The
                  Employee must provide the Employer a copy of any employment
                  agreement, offer letter, or consulting agreement disclosing
                  total compensation to be paid to the Employee for services
                  rendered following the termination date. Subject to the
                  remaining terms of this Agreement, Employer will pay Employee
                  at least 33% of the amount to be paid under this Paragraph 9
                  notwithstanding any such mitigation. In the event Employee
                  fails to notify Employer that he has accepted employment or is
                  otherwise performing services after the date of termination of
                  employment with any person or entity, or that he has entered
                  into any form of agreement or arrangement, including, but not
                  limited to, a consulting arrangement whereby Employee is paid
                  for Employee's services, then all severance benefits provided
                  under this Agreement will cease immediately and all
                  liabilities and obligations of Employer hereunder shall
                  terminate.

                  Notwithstanding anything in the Agreement to the contrary, in
                  the event Employee obtains a full-time position with the
                  Employer or any of its subsidiaries or affiliates after the
                  execution of this Agreement but prior to the last day on which
                  severance payments are due under this Agreement, Employee
                  understands and agrees that all severance payments will cease
                  immediately and that all liabilities and obligations of the
                  Employer hereunder shall terminate.


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      10. CONDITIONS TO BENEFITS. Anything in this Agreement to the contrary
notwithstanding:

            (a)   To receive the benefits enumerated in Paragraph 9, Employee
                  shall execute and agree to be bound by a release agreement
                  substantially in the form attached to this Agreement as
                  Exhibit A; and

            (b)   Employee's right to receive any of the benefits provided for
                  in Paragraph 9 or otherwise in this Agreement following
                  termination of employment shall immediately cease and be of no
                  further force or effect if Employee violates any of the
                  covenants contained in Paragraphs 11, 12, 13, 14 or 15.

      11. COVENANT NOT-TO-SOLICIT. Employer and Employee acknowledge that,
during Employee's employment, Employer will spend considerable amounts of time,
effort and resources in providing Employee with knowledge relating to the
business affairs of Employer and the Affiliates, including Employer's and the
Affiliates' trade secrets, proprietary information and other information
concerning Employer's and the Affiliates' financing sources, finances, customer
lists, customer records, prospective customers, staff, contemplated acquisitions
(whether of business or assets), ideas, methods, marketing investigations,
surveys, research, customers' records and any other information relating to
Employer's and the Affiliates' Business.

      To protect Employer from Employee's solicitation of business from
customers during the Restricted Period, Employee agrees that, subject to
Paragraph 17 hereof, he shall not, directly or indirectly, for any person
(including Employee himself), corporation, firm, partnership, proprietorship or
other entity, other than Employer or an Affiliate, engaged in the Business,
solicit transportation, logistics or other business of the type provided by
Employer for any customer with whom the Employee had material contact during the
twelve (12) month period immediately preceding the termination of Employee's
employment. Material contact includes personal contact with customers, the
supervision of the efforts of others who have personal contact with the
customers, and the receipt of confidential information of customers of Employer.
This Paragraph 11 shall, except as otherwise provided in this Agreement, survive
the termination of this Agreement.

      12. COVENANT NOT-TO-DISCLOSE. Employee agrees that during employment with
Employer and for a period of three (3) years following the cessation of that
employment for any reason, Employee shall not directly or indirectly divulge or
make use of any Confidential Information or Trade Secrets (so long as the
information remains a Trade Secret or remains confidential) without prior
written consent of Employer. Employee further agrees that if Employee is
questioned about information subject to this agreement by anyone not authorized
to receive such information, Employee will promptly notify Employee's
supervisor(s) or an officer of Employer. This Agreement does not limit the
remedies available under common or statutory law, which


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may impose longer duties of non-disclosure. For purposes of this Agreement, the
following definition shall apply:

      "Confidential Information" means information about Employer and its
      Employees, Customers and/or Suppliers which is not generally known outside
      of Employer, which employee learns of in connection with employee's
      employment with Employer, and which would be useful to competitors of
      Employer. Confidential Information includes, but is not limited to: (1)
      business and employment policies, marketing methods and the targets of
      those methods, finances, business plans, promotional materials and price
      lists; (2) the terms upon which Employer obtains products or services from
      its vendors and sells them to customers; (3) the nature, origin,
      composition and development of Employer's products; (4) the manner in
      which Employer provides products and services to its customers.

      13. COVENANT NOT-TO-INDUCE. Employee covenants and agrees that during the
Restricted Period, he will not, directly or indirectly, on Employee's own behalf
or in the service or on behalf of others, solicit, induce or attempt to solicit
or induce an employee or other personnel of Employer and the Affiliates to
terminate employment with such party. This Paragraph 13 shall, except as
otherwise provided in this Agreement, survive the termination of this Agreement.

      14. COVENANT OF NON-DISPARAGEMENT AND COOPERATION. Employee agrees that he
shall not, at any time during or following the Term, make any remarks
disparaging the conduct or character of Employer or any of its current or former
Affiliates, agents, employees, officers, directors, shareholders, successors or
assigns (in the aggregate, such persons and entities are referred to herein as
the "Protected Persons"); provided, however, that during the Term, Employer
acknowledges and agrees that Employee may be required from time to time to make
such remarks about Protected Persons for legitimate business purposes and if
consistent with the discharge of Employee's duties hereunder. In addition,
following termination of Employee's employment hereunder, Employee agrees to
reasonably cooperate with Employer, at no extra cost, in any litigation or
administrative proceedings (e.g., EEOC charges) involving any matters with which
Employee was involved during Employee's employment with Employer. Employer shall
reimburse Employee for travel and other related expenses approved by Employer
incurred in providing such assistance. This Section 14 shall survive the
termination of this Agreement.

      15. COVENANT NOT TO COMPETE. Employer and Employee acknowledge that, by
virtue of Employee's responsibilities and authority, he will, during the course
of Employee's employment, be instrumental in developing, and will receive,
highly confidential information concerning Employer and the Affiliates, their
services, their trade secrets, their proprietary information, and other
information concerning the business of Employer and the Affiliates, much of
which is unavailable to persons of lesser responsibility and authority. Employee
further acknowledges that the ability of such information to benefit a
competitor or potential competitor of Employer shall cause irreparable harm,
damage and loss to Employer and the Affiliates. To protect Employer


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<PAGE>
and the Affiliates from Employee's using or exploiting Employee's information,
Employee agrees that he shall not, for a period of twelve (12) months from the
date of termination of this Agreement for any reason, perform substantially
similar job duties or functions as those performed for Employer under this
Agreement for any entity engaged in the Business in the 48 states of the
continental United States of America (the "Restricted Territory"). This Section
15 shall survive termination of this Agreement.

      16. SPECIFIC ENFORCEMENT. Employer and Employee expressly agree that a
violation of the covenants contained in Paragraphs 11, 12, 13, 14 and 15 hereof,
or any provision thereof, shall cause irreparable injury to Employer and that,
accordingly, Employer shall be entitled, in addition to any other rights and
remedies it may have at law or in equity, to an injunction enjoining and
restraining Employee from doing or continuing to do any such act and any other
violation or threatened violation of said Paragraphs 11, 12, 13, 14 and 15
hereof.

      17. SEVERABILITY. In the event any provision of this Agreement shall be
found to be void, the remaining provisions of this Agreement shall nevertheless
be binding with the same effect as though the void part were deleted; provided,
however, if Paragraphs 11, 12, 13,14 and 15 shall be declared invalid, in whole
or in part, Employee shall execute, as soon as possible, a supplemental
agreement with Employer, granting Employer, to the extent legally possible, the
protection afforded by said Paragraphs. It is expressly understood and agreed by
the parties hereto that Employer shall not be barred from enforcing the
restrictive covenants contained in each of Paragraphs 11, 12, 13, 14 and 15 as
each are separate and distinct, so that the invalidity of any one or more of
said covenants shall not affect the enforceability and validity of the other
covenants.

      18. INCOME TAX WITHHOLDING. Employer or any other payor may withhold from
any compensation or benefits payable under this Agreement such Federal, State,
City or other taxes as shall be required pursuant to any law or governmental
regulation or ruling.

      19. WAIVER. The waiver of a breach of any term of this Agreement by any of
the parties hereto shall not operate or be construed as a waiver by such party
of the breach of any other term of this Agreement or as a waiver of a subsequent
breach of the same term of this Agreement.

      20. RIGHTS AND LIABILITIES UPON NOTICE OF TERMINATION. As soon as notice
of termination of this Agreement is given, Employee shall immediately cease
contact with all customers of Employer and shall forthwith surrender to Employer
all customer lists, documents and other property of Employer then in Employee's
possession, compliance with which shall not be deemed to be a breach of this
Agreement by Employee. Pending the surrender of all such customer lists,
documents and other property to Employer, Employer may hold in abeyance any
payments due Employee pursuant to this Agreement.


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<PAGE>
      21. ASSIGNMENT.

            (a)   Employee shall not assign, transfer or convey this Agreement,
                  or in any way encumber the compensation or other benefits
                  payable to him hereunder, except with the prior written
                  consent of Employer or upon Employee's death.

            (b)   The covenants, terms and provisions set forth herein shall be
                  binding upon and shall inure to the benefit of, and be
                  enforceable by, Employer and its successors and assigns;
                  provided, Employer shall require any successor (whether direct
                  or indirect, by purchase, merger, reorganization,
                  consolidation, acquisition of property or stock, liquidation
                  or otherwise) to all or a substantial portion of its assets,
                  by agreement in form and substance reasonably satisfactory to
                  Employee, expressly to assume and agree to perform this
                  Agreement in the same manner and to the same extent that
                  Employer would be required to perform this Agreement if no
                  such succession had taken place. Regardless of whether such an
                  agreement is executed, this Agreement shall be binding upon
                  any successor of Employer in accordance with the operation of
                  law, and such successor shall be deemed the "Employer" for
                  purposes of this Agreement.

      22. NOTICES. All notices required herein shall be in writing and shall be
deemed to have been given when delivered personally or five (5) days after the
date on which such notice is deposited in the U.S. Mail, certified or
registered, postage prepaid, return receipt requested, addressed as follows, to
wit:

                  If to Employer at:

                           160 Clairemont Avenue, Suite 200
                           Decatur, Georgia 30030
                           Attn:  Thomas M. Duffy, General Counsel

                  If to Employee at:

                           _____________________________
                           _____________________________
                           _____________________________

or at such other addresses as may, from time to time, be furnished to Employer
by Employee, or by Employer to Employee on the terms of this Paragraph.

      23. BINDING EFFECT. This Agreement shall be binding on the parties hereto
and on their respective heirs, administrators, executors, successors and
permitted assigns.


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<PAGE>
      24. ENFORCEABILITY. This Agreement contains the entire understanding of
the parties and may be altered, amended or modified only by a writing executed
by both of the parties hereto. This Agreement supersedes all prior agreements
and understandings by and between Employer and Employee relating to Employee's
employment.

      25. APPLICABLE LAW. This Agreement and the rights and liabilities of the
parties hereto shall be governed by, and construed and interpreted in accordance
with, the laws of the State of Georgia.

      26. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall constitute an original, but all of which
together shall constitute but a single document.

      27. D&O INSURANCE; INDEMNIFICATION. Employer shall maintain, for the
benefit of Employee, director and officer liability insurance, in form at least
as comprehensive as, and in an amount that is equal to, that maintained by
Employer on the Effective Date, provided, however, that Employer's Board of
Directors or chief senior Executive Officer shall have the discretion to modify
such coverage so long as such modification applies to all officers and
directors. In addition, Employer shall indemnify Employee against liability as
an officer and director of Employer to the same extent as other officers and
directors of Employer in accordance with the constituent and organizational
documents of Employer and consistent with applicable law. Employee's rights
under this Section 27 shall continue so long as he may be subject to such
liability, whether or not this Agreement may have been terminated prior hereto.


                                       13
<PAGE>
      IN WITNESS WHEREOF, Employee has hereunder set Employee's hand and seal,
and Employer has caused this Agreement to be executed and delivered by its duly
authorized officers, all as of the day and year first above written.

__________________                          _____________________(SEAL)
WITNESS                                     DAVID RAWDEN



ATTEST:                                     ALLIED HOLDINGS, INC.



By:_________________________                By:___________________________
      Its ________ Secretary                      Its ____________


      [CORPORATE SEAL]


                                       14
<PAGE>
                               FIRST AMENDMENT TO
                              EMPLOYMENT AGREEMENT

      THIS FIRST AMENDMENT to Employment Agreement (the "Amendment") is made and
entered into as of the 13th day of February, 2003, by and between David A.
Rawden ("Employee") and Allied Holdings, Inc. ("Employer").

                                   WITNESSETH:

      WHEREAS, Employer and Employee entered into that certain Employment
Agreement dated effective as of March 4, 2002 (the "Employment Agreement"); and

      WHEREAS, the parties desire to amend the Employment Agreement as set forth
herein;

      NOW, THEREFORE, for and in consideration of the covenants and conditions
set forth herein, and other good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, Employer and Employee hereby mutually
agree as follows:

      1. Section 6 shall be amended by the inclusion of the following new
Section 6(h):

            "(h) Employer shall be entitled to reimburse Employee for expenses,
            including, but not limited to, mortgage payments and taxes on his
            residence in Detroit, MI until such time as it is sold and within
            the financial limitations presently included in the Employment
            Agreement, and that such payments shall be included in the temporary
            living expenses Employee is entitled to be reimbursed for by
            Employer under the terms and conditions of the Employment Agreement;
            provided that nothing contained in Section 6(h) shall increase the
            maximum obligation of Employer to Employee under the Employment
            Agreement regarding reimbursements or other consideration."

      2. All terms which are capitalized herein, but which are not defined
herein, shall have the meanings ascribed to them in the Employment Agreement.

      3. All provisions of the Employment Agreement which have not been amended
by this Amendment shall remain in full force and effect. Notwithstanding the
foregoing, to the extent there is any inconsistency between the provisions of
the Employment Agreement and the provisions of this Amendment, the provisions of
this Amendment shall control.

      4. Each of the parties hereto will, from time to time, and at all times
hereafter, upon every reasonable request to do so by any other party, make, do,
execute and deliver, or cause to be made done, executed and delivered, all such
further acts,
<PAGE>
deeds, assurances and things as may be reasonably required or necessary in order
to further implement and carry out the terms and purpose of this Amendment.

      5. This Amendment may be executed in one or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute
the same agreement, document, or instrument. Any signature page of any such
counterpart, or any electronic facsimile thereof, may be attached or appended to
any other counterpart to complete a fully executed counterpart of such
agreement, document or instrument, and any telecopy or other facsimile
transmission of any signature shall be deemed an original and shall bind such
party.

      IN WITNESS WHEREOF, each of the parties hereto has caused this Amendment
to be duly executed on its behalf, all as of the day and year first written
above.

                                   "Employer"

                                   ALLIED HOLDINGS, INC.



                                   By: /s/ Thomas M. Duffy
                                       _______________________________
                                           Thomas M. Duffy,
                                           Senior Vice President


                                   "Employee"


                                   /s/ David A. Rawden
                                   ___________________________________
                                   DAVID A. RAWDEN