<PAGE>   1
                                 UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-Q

[X]      QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
         EXCHANGE ACT OF 1934 - FOR THE QUARTERLY PERIOD ENDED JUNE 30, 1999

                                       or

[ ]      TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
         EXCHANGE ACT OF 1934 - For the transition period from_________________
         to_____________________

         Commission File Number:   0-22276

                             ALLIED HOLDINGS, INC.
   ----------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)

<TABLE>
<CAPTION>
                           GEORGIA                                                    58-0360550
---------------------------------------------------------------------------------------------------------------
<S>                                                                    <C>
(State or other jurisdiction of incorporation or organization)         (I.R.S. Employer Identification Number)
</TABLE>

            SUITE 200, 160 CLAIREMONT AVENUE, DECATUR, GEORGIA 30030
-------------------------------------------------------------------------------
                    (Address of principal executive offices)

                                 (404) 373-4285
-------------------------------------------------------------------------------
              (Registrant's telephone number, including area code)

-------------------------------------------------------------------------------

        (Former name, former address and former fiscal year, if changed
                               since last report)

         Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.                [X] Yes   [ ] No




Outstanding common stock, No par value at August 3, 1999.............7,990,669



               TOTAL NUMBER OF PAGES INCLUDED IN THIS REPORT:17


                                       1
<PAGE>   2

                                     INDEX

                                     PART I

                             FINANCIAL INFORMATION


<TABLE>
<CAPTION>
                                                                                                                PAGE
ITEM 1:              FINANCIAL STATEMENTS

<S>          <C>                                                                                                <C>
             Consolidated Balance Sheets as of June 30, 1999 and
                December 31, 1998..............................................................................   3

             Consolidated Statements of Operations for the Three and Six
                  Month Periods Ended June 30, 1999 and 1998...................................................   4

             Consolidated Statements of Cash Flows for the Six
                Month Periods Ended June 30, 1999 and 1998.....................................................   5

             Notes to Consolidated Financial Statements........................................................   6


ITEM 2
             Management's Discussion and Analysis of Financial
                Condition and Results of Operations............................................................   8


<CAPTION>
                                    PART II

                               OTHER INFORMATION

<S>         <C>                                                                                                 <C>
ITEM 4

            Submission of Matters to a Vote of Security Holders................................................  15

ITEM 6

            Exhibits and Reports on Form 8-K...................................................................  16
            Signature Page.....................................................................................  17
</TABLE>


                                       2
<PAGE>   3

PART 1 - FINANCIAL INFORMATION
ITEM 1 - FINANCIAL STATEMENTS

                     ALLIED HOLDINGS, INC. AND SUBSIDIARIES

                          CONSOLIDATED BALANCE SHEETS
                                 (In Thousands)


<TABLE>
<CAPTION>
                                                                                         June 30          December 31
                                                                                           1999               1998
                                                                                       -----------        -----------
                                                                                       (Unaudited)
                              ASSETS

<S>                                                                                    <C>                <C>
CURRENT ASSETS:
         Cash and cash equivalents                                                      $ 24,824            $ 21,977
         Short-term investments                                                           22,935              23,323
         Receivables, net of allowance for doubtful accounts                             114,679             103,968
         Inventories                                                                       8,241               6,788
         Deferred tax assets                                                              19,150              20,773
         Prepayments and other current assets                                             22,611              18,930
                                                                                        --------            --------
                             Total current assets                                        212,440             195,759
                                                                                        --------            --------

PROPERTY AND EQUIPMENT, NET                                                              298,782             297,530
                                                                                        --------            --------

OTHER ASSETS:
         Goodwill, net                                                                    94,079              94,577
         Other                                                                            34,141              33,761
                                                                                        --------            --------
                             Total other assets                                          128,220             128,338
                                                                                        --------            --------
                             Total assets                                               $639,442            $621,627
                                                                                        ========            ========

                  LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES:
         Current maturities of long-term debt                                           $  1,380            $  2,746
         Trade accounts payable                                                           32,467              42,196
         Accrued liabilities                                                              94,047             100,788
                                                                                        --------            --------
                             Total current liabilities                                   127,894             145,730
                                                                                        --------            --------

LONG-TERM DEBT, less current maturities                                                  326,845             291,096
                                                                                        --------            --------

POSTRETIREMENT BENEFITS OTHER THAN PENSIONS                                               10,988              11,165
                                                                                        --------            --------

DEFERRED INCOME TAXES                                                                     39,064              39,953
                                                                                        --------            --------

OTHER LONG-TERM LIABILITIES                                                               69,464              70,830
                                                                                        --------            --------

STOCKHOLDERS' EQUITY:
                   Common stock, no par value; 20,000 shares authorized, 7,964
                             and 7,878 shares outstanding at June 30,
                             1999 and December 31, 1998, respectively                          0                   0
                   Additional paid-in capital                                             46,085              44,854
                   Retained earnings                                                      25,481              25,354
                   Cumulative other comprehensive income, net of tax                      (4,227)             (6,115)
                   Unearned compensation                                                  (2,152)             (1,240)
                                                                                        --------            --------
                             Total stockholders' equity                                   65,187              62,853
                                                                                        --------            --------
                             Total liabilities and stockholders' equity                 $639,442            $621,627
                                                                                        ========            ========
</TABLE>

              The accompanying notes are an integral part of these
                         consolidated balance sheets.


                                       3
<PAGE>   4

                     ALLIED HOLDINGS, INC. AND SUBSIDIARIES

                     CONSOLIDATED STATEMENTS OF OPERATIONS
                     (In Thousands, Except Per Share Data)
                                  (Unaudited)


<TABLE>
<CAPTION>
                                                                   FOR THE THREE MONTHS        FOR THE SIX MONTHS ENDED
                                                                       ENDED JUNE 30                  JUNE 30
                                                                  -----------------------------------------------------
                                                                    1999           1998           1999           1998

<S>                                                               <C>            <C>            <C>            <C>
REVENUES                                                          $286,984       $280,641       $548,233       $534,031
                                                                  --------       --------       --------       --------

OPERATING EXPENSES:
     Salaries, wages and fringe benefits                           150,128        143,150        294,773        280,769
     Operating supplies and expenses                                49,701         45,257         94,482         87,997
     Purchased transportation                                       28,692         32,450         54,529         59,985
     Insurance and claims                                           12,260         10,778         25,877         20,220
     Operating taxes and licenses                                   11,096         10,419         21,812         20,417
     Depreciation and amortization                                  14,362         13,015         28,377         25,940
     Rents                                                           2,301          2,456          4,368          4,807
     Communications and utilities                                    2,197          2,287          4,427          4,602
     Other operating expenses                                        1,506          1,505          4,817          3,183
                                                                  --------       --------       --------       --------
               Total operating expenses                            272,243        261,317        533,462        507,920
                                                                  --------       --------       --------       --------
               Operating income                                     14,741         19,324         14,771         26,111
                                                                  --------       --------       --------       --------

OTHER INCOME (EXPENSE):
     Interest expense                                               (7,758)        (6,260)       (15,167)       (12,282)
     Interest income                                                   329            565            620          1,021
                                                                  --------       --------       --------       --------
                                                                    (7,429)        (5,695)       (14,547)       (11,261)
                                                                  --------       --------       --------       --------

INCOME BEFORE INCOME TAXES                                           7,312         13,629            224         14,850

INCOME TAX  PROVISION                                               (3,180)        (5,932)           (97)        (6,463)
                                                                  --------       --------       --------       --------

NET INCOME                                                        $  4,132       $  7,697       $    127       $  8,387
                                                                  ========       ========       ========       ========


PER COMMON SHARE:
     BASIC                                                        $   0.53       $   0.99       $   0.02       $   1.08
                                                                  ========       ========       ========       ========
     DILUTED                                                      $   0.53       $   0.98       $   0.02       $   1.07
                                                                  ========       ========       ========       ========

COMMON SHARES OUTSTANDING:
     BASIC                                                           7,792          7,748          7,791          7,747
                                                                  ========       ========       ========       ========
     DILUTED                                                         7,800          7,861          7,807          7,860
                                                                  ========       ========       ========       ========
</TABLE>

 The accompanying notes are an integral part of these consolidated statements.


                                       4
<PAGE>   5

                     ALLIED HOLDINGS, INC. AND SUBSIDIARIES

                     CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (IN THOUSANDS)
                                  (UNAUDITED)

<TABLE>
<CAPTION>
                                                                                                       FOR THE SIX MONTHS ENDED
                                                                                                                JUNE 30
                                                                                                       ------------------------
                                                                                                         1999            1998
                                                                                                       --------        --------

<S>                                                                                                    <C>             <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
            Net income                                                                                 $   127         $ 8,387
                                                                                                       -------         -------
            Adjustments to reconcile net income to net
            cash (used in) provided by operating activities:
                           Depreciation and amortization                                                28,377          25,940
                           (Gain) loss on sale of property and equipment                                   (24)            212
                           Deferred income taxes                                                          (685)          3,497
                           Compensation expense related to stock options and grants                        292             128
                           Equity in loss (earnings) of joint ventures                                     738            (130)
                           Change in operating assets and liabilities:
                                 Receivables, net of allowance for doubtful accounts                   (10,067)         (5,150)
                                 Inventories                                                            (1,406)         (1,739)
                                 Prepayments and other current assets                                   (3,581)            128
                                 Trade accounts payable                                                 (9,980)         (4,297)
                                 Accrued liabilities                                                    (8,484)        (10,946)
                                                                                                       -------         -------
                                              Total adjustments                                         (4,820)          7,643
                                                                                                       -------         -------
                                              Net cash (used in) provided by operating activities       (4,693)         16,030
                                                                                                       -------         -------


CASH FLOWS FROM INVESTING ACTIVITIES:
            Purchases of property and equipment                                                        (26,482)        (25,149)
            Proceeds from sale of property and equipment                                                   827             501
            Purchase of business, net of cash acquired                                                  (1,879)           (400)
            Investment in joint venture                                                                    (80)        (11,920)
            Decrease in short-term investments                                                             388           1,853
            Decrease (increase) in the cash surrender value of life insurance                               73          (1,190)
                                                                                                       -------         -------
                                              Net cash used in investing activities                    (27,153)        (36,305)
                                                                                                       -------         -------


CASH FLOWS FROM FINANCING ACTIVITIES:
            Proceeds from issuance of long-term debt, net                                               34,383          20,906
            Proceeds from exercise of stock options                                                         27              24
            Other, net                                                                                     106              30
                                                                                                       -------         -------
                                              Net cash provided by financing activities                 34,516          20,960
                                                                                                       -------         -------


EFFECT OF EXCHANGE RATE CHANGES ON CASH
            AND CASH EQUIVALENTS                                                                           177             103


NET INCREASE IN CASH AND CASH EQUIVALENTS                                                                2,847             788


CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR                                                          21,977          10,530
                                                                                                       -------         -------


CASH AND CASH EQUIVALENTS AT END OF PERIOD                                                             $24,824         $11,318
                                                                                                       =======         =======
</TABLE>


 The accompanying notes are an integral part of these consolidated statements.


                                       5
<PAGE>   6

                     ALLIED HOLDINGS, INC. AND SUBSIDIARIES
             Notes to Consolidated Financial Statements (Unaudited)

Note 1.  Basis of Presentation

         The unaudited consolidated financial statements included herein have
         been prepared pursuant to the rules and regulations of the Securities
         and Exchange Commission. Accordingly, they do not include all of the
         information and footnotes required by generally accepted accounting
         principles for complete financial statements. The statements contained
         herein reflect all adjustments, all of which are of a normal,
         recurring nature, which are, in the opinion of management, necessary
         to present fairly the financial condition, results of operations and
         cash flows for the periods presented. Operating results for the three
         and six month periods ended June 30, 1999 are not necessarily
         indicative of the results that may be expected for the year ended
         December 31, 1999. The interim financial statements should be read in
         conjunction with the financial statements and notes thereto of Allied
         Holdings, Inc. and Subsidiaries, (the "Company") included in the
         Company's 1998 Annual Report on Form 10-K.

Note 2.  Long-Term Debt

         On September 30, 1997, the Company issued $150 million of 8 5/8 %
         senior notes (the "Notes") through a private placement. Subsequently,
         the senior notes were registered with the Securities and Exchange
         Commission. The net proceeds from the Notes were used to fund the
         acquisition of Ryder Automotive Carrier Services, Inc. and RC
         Management Corp., pay related fees and expenses, and reduce
         outstanding indebtedness. The Company's obligations under the Notes
         are guaranteed by substantially all of the subsidiaries of the Company
         (the "Guarantors"). Separate financial statements of the Guarantors
         are not provided herein as (i) the Guarantors are jointly and
         severally liable for the Company's obligations under the Notes, (ii)
         the subsidiaries which are not Guarantors are inconsequential to the
         consolidated operations of the Company and its subsidiaries and (iii)
         the net assets and earnings of the Guarantors are substantially
         equivalent to the net assets and earnings of the consolidated entity
         as reflected in these consolidated financial statements. There are no
         restrictions on the ability of the Guarantors to make distributions to
         the Company.

Note 3.  Comprehensive Income

         The Company had comprehensive income of $5.3 million for the second
         quarter of 1999 versus $6.0 million for the second quarter of 1998.
         For the first six months of 1999, comprehensive income was $2.0
         million, versus $7.1 million for the first six months of 1998. The
         difference between comprehensive income and net income is the foreign
         currency translation adjustment, net of income taxes.


                                       6
<PAGE>   7

Note 4.  Accounting for Derivative Instruments and Hedging Activities

         In June 1998, the Financial Accounting Standards Board issued SFAS No.
         133, "Accounting for Derivative Instruments and Hedging Activities."
         The Statement establishes accounting and reporting standards requiring
         that every derivative instrument (including certain derivative
         instruments embedded in other contracts) be recorded in the balance
         sheet as either an asset or liability measured at its fair value. The
         Statement requires that changes in the derivative's fair value be
         recognized currently in earnings unless specific hedge accounting
         criteria are met. Special accounting for qualifying hedges allows a
         derivative's gains and losses to offset related results on the hedged
         item in the income statement, and requires that a company must
         formally document, designate, and assess the effectiveness of
         transactions that receive hedge accounting.

         During the second quarter of 1999, the Financial Accounting Standards
         Board issued SFAS No. 137, which deferred the effective date of SFAS
         No. 133. The Statement defers the effective date for all quarters of
         all fiscal years beginning after June 15, 2000. The Company will adopt
         this statement in the first quarter of 2001. The Company does not
         believe the adoption will have a material impact on its financial
         position or results of operations.

Note 5.  Segment Reporting

         The Company operates in one reportable industry segment: transporting
         automobiles and light trucks from manufacturing plants, ports,
         auctions, and railway distribution points to automotive dealerships.
         Geographic financial information is as follows (in thousands):


<TABLE>
<CAPTION>
                                 For the three months ended           For the six months ended
                                          June 30                             June 30
                                 --------------------------         ---------------------------
                                   1999              1998              1999              1998
                                ---------         ---------         ---------         ---------

<S>                             <C>               <C>               <C>               <C>
Revenues:
United States                   $ 237,431         $ 229,486         $ 455,345         $ 437,064
Canada                             49,553            51,155            92,888            96,967
                                ---------         ---------         ---------         ---------
                                $ 286,984         $ 280,641         $ 548,233         $ 534,031
                                =========         =========         =========         =========
</TABLE>

Revenues are attributed to the respective countries based on the location of
the origination terminal.


                                       7
<PAGE>   8

Note 6.  Reclassifications

         Certain amounts in the prior year financial statements have been
         reclassified to conform with the current year presentation.

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
         RESULTS OF OPERATIONS

RESULTS OF OPERATIONS

         Revenues were $287.0 million for the second quarter of 1999 versus
         revenues of $280.6 million for the second quarter of 1998, an increase
         of 2.3%. For the six-month period ended June 30, 1999, revenues were
         $548.2 million, versus revenues of $534.0 million reported for the
         same period last year, an increase of 2.7%. The increase in revenues
         is attributed to increased vehicle deliveries resulting from higher
         new vehicle production and sales.

         Net income was $4.1 million during the second quarter of 1999 versus
         $7.7 million during the second quarter of 1998. Basic and diluted
         earnings per share for the second quarter of 1999 were $0.53, versus
         basic earnings per share of $0.99 and diluted earnings per share of
         $0.98 in the second quarter of 1998. For the six-month period ended
         June 30, 1999, net income was $127.0 thousand, versus $8.4 million for
         the comparable six-month period a year ago. During the first six months
         of 1999, net income was impacted by costs associated with severe winter
         weather, year 2000 testing and remediation costs, lower earnings from
         the Company's Brazilian venture because of the deterioration of the
         Brazilian economy, as well as a decline in load averages.

         The Company experienced a significant increase in the percentage of
         vehicles delivered that were light trucks as well as an overall
         increase in the size and weight of most vehicles delivered. Due to
         regulations on tractor and trailer length, height, width, and maximum
         weight capacity, this change in mix resulted in the number of vehicles
         delivered per load in the first six months of 1999 being approximately
         4% lower than the first six months of 1998. The change in mix
         negatively impacts operating results as revenue is realized on a per
         vehicle basis, thus the Company's revenue per load decreased. The
         Company estimates that operating income for the first and second
         quarter of 1999 was reduced by approximately $5 million per quarter as
         a result of the load average decline. Throughout the second quarter,
         the Company has been discussing the load average decline with the
         manufacturers. The Company has been successful at resolving the issue
         with certain customers and is continuing discussions with others. The
         result will be an increase in the revenue generated per vehicle
         delivered.

         During the second quarter of 1999, the Company negotiated a new
         agreement with the International Brotherhood of Teamsters Union in the
         United States. The previous contract expired June 1, 1999. The
         Teamsters ratified the new contract in July, 1999. During the second
         quarter of 1999, the Company incurred $1-$2 million of costs for
         contingency planning related to the negotiations.

         The following is a discussion of the changes in the Company's major
         expense categories:

         Salaries, wages and fringe benefits increased from 51.0 % of revenues
         in the second quarter of 1998 to 52.3 % of revenues for the second
         quarter of 1999, and from 52.6% of revenues for the first six months
         of 1998 to 53.8% of revenues for the first six months of 1999. This
         increase was due primarily to annual salary and benefit increases,
         together with the inefficiencies resulting from the decline in load
         averages offset by continued productivity


                                       8
<PAGE>   9

         and efficiency improvements. Also, salaries, wages and fringe benefits
         increased because of an increase in the mix of loads hauled by company
         drivers versus owner-operators and other carriers. The number of
         owner-operators year-to-year was comparable; thus company drivers
         delivered the additional loads hauled by the Company.

         Operating supplies and expenses increased from 16.1% of revenues in
         the second quarter of 1998 to 17.3% of revenues for the second quarter
         of 1999, and increased from 16.5% of revenues for the first six months
         of 1998 to 17.2% for the first six months of 1999. The increase was
         due primarily to the inefficiencies resulting from the decrease in
         load averages. The Company experienced lower fuel prices in the first
         quarter of 1999, which were offset by higher fuel prices in the
         second quarter of 1999. In addition, the Company also incurred certain
         one-time costs related to contingency planning for its US labor
         negotiations that contributed to the increase.

         Purchased transportation expense decreased from 11.6% of revenues in
         the second quarter of 1998 to 10.0% of revenues for the second quarter
         of 1999, and decreased from 11.2% of revenues for the first six months
         of 1998 to 10.0% of revenues for the first six months of 1999. The
         decrease was due primarily to the decrease in the mix of loads hauled
         by owner-operators and other carriers versus company drivers. The
         number of owner-operators year-to-year was comparable; thus company
         drivers delivered the additional loads hauled by the Company.

         Insurance and claims expense increased from 3.8% of revenues in the
         second quarter of 1998 to 4.3% of revenues for the second quarter of
         1999, and increased from 3.8% of revenue for the first six months of
         1998 to 4.7% of revenues for the first six months of 1999. The
         increase is due primarily to an increase in the frequency of damage
         claims, mainly resulting from hauling larger size vehicles by the
         Company.

         Depreciation and amortization expense increased from 4.6% of revenues
         in the second quarter of 1998 to 5.0% for the second quarter of 1999,
         and increased from 4.9% of revenues for the first six months of 1998
         to 5.2% of revenues for the first six months of 1999. The increase was
         related to the increase in the Company's capital expenditures during
         1998 and 1999.

         Interest expense as a percentage of revenues increased from 2.2 %
         during the second quarter of 1998 to 2.7% in the second quarter of
         1999, and increased from 2.3% of revenue for the first six months of
         1998 to 2.8% for the first six months of 1999. The increase was due
         primarily to higher long-term debt levels in 1999 versus 1998.

FINANCIAL CONDITION, LIQUIDITY AND CAPITAL RESOURCES

         Net cash used by operating activities totaled $4.7 million for the
         six-month period ended June 30, 1999, versus $16.0 million provided by
         operating activities for the six-month period ended June 30, 1998. The
         increase in cash used by operating activities was primarily due to a
         $14.6 million reduction in pre-tax earnings during the first six
         months of 1999 versus 1998.


                                       9
<PAGE>   10

         Net cash used in investing activities totaled $27.1 million for the
         six-month period ended June 30, 1999, versus $36.3 million for the
         six-month period ended June 30, 1998. The decrease was due primarily
         to an $11.9 million investment in Axis Do Brazil in February of 1998.

         Net cash provided by financing activities totaled $34.5 million for
         the six-month period ended June 30, 1999, versus $21.0 million for the
         six-month period ended June 30, 1998. The increase was due primarily
         to seasonal borrowings required to finance operating activities due to
         the reduction in pre-tax earnings.

DISCLOSURES ABOUT MARKET RISKS

         The market risk inherent in the Company's market risk sensitive
         instruments and positions is the potential loss arising from adverse
         changes in short-term investment prices, interest rates, fuel prices,
         and foreign currency exchange rates.

         SHORT-TERM INVESTMENTS - The Company does not use derivative financial
         instruments in its investment portfolio. The Company places its
         investments in instruments that meet high credit quality standards, as
         specified in the Company's investment policy guidelines. The policy
         also limits the amount of credit exposure to any one issue, issuer,
         and type of instrument. Short-term investments at June 30, 1999, which
         are recorded at fair value of $22.9 million, have exposure to price
         risk. This risk is estimated as the potential loss in fair value
         resulting from a hypothetical 10% adverse change in quoted prices and
         amounts to $2.3 million.

         INTEREST RATES - The Company primarily issues long-term debt
         obligations to support general corporate purposes including capital
         expenditures and working capital needs. The majority of the Company's
         long-term debt obligations bear a fixed rate of interest. A
         one-percentage point increase in interest rates affecting the
         Company's floating rate long-term debt would reduce pre-tax income by
         $1.4 million over the next fiscal year. A one-percentage point change
         in interest rates would not have a material effect on the fair value
         of the Company's fixed rate long-term debt.

         FUEL PRICES - The Company is dependent on diesel fuel to operate its
         fleet of rigs. Diesel fuel prices are subject to fluctuations due to
         unpredictable factors such as weather, government policies, changes in
         global demand, and global production. To reduce price risk caused by
         market fluctuations, the Company generally follows a policy of hedging
         a portion of its anticipated diesel fuel consumption. The instruments
         used are principally readily marketable exchange traded futures
         contracts that are designated as hedges. The changes in market value
         of such contracts have a high correlation to the price changes of
         diesel fuel. Gains and losses resulting from fuel hedging transactions
         are recognized when the underlying fuel being hedged is used. A 10%
         increase in diesel fuel prices would reduce pre-tax income by $3.9
         million over the next fiscal year.

         FOREIGN CURRENCY EXCHANGE RATES - Although the majority of the
         Company's operations are in the United States, the Company does have
         foreign subsidiaries


                                      10
<PAGE>   11

         (primarily Canada). The net investments in foreign subsidiaries
         translated into dollars using exchange rates at June 30, 1999, are
         $81.4 million. The potential loss in fair value impacting other
         comprehensive income resulting from a hypothetical 10% change in
         quoted foreign currency exchange rates amounts to $8.1 million. The
         Company does not use derivative financial instruments to hedge its
         exposure to changes in foreign currency exchange rates.

YEAR 2000

         Year 2000 ("Y2K" or "Year 2000") issues are being addressed by the
         Company. The Company, like most other major companies, is currently
         addressing a universal problem commonly referred to as "Year 2000
         Compliance," which relates to the ability of computer programs and
         systems to properly recognize and process date sensitive information
         before and after January 1, 2000. The following discussion is based on
         information currently available to the Company.

         The Company has analyzed and continues to analyze its internal
         information technology ("IT") systems ("IT systems") to identify any
         computer programs that are not Year 2000 compliant and implement any
         changes required to make such systems Year 2000 compliant. The Company
         believes that its critical IT systems currently are capable of
         functioning without substantial Year 2000 Compliance problems. Of the
         non-critical, but important, IT systems that are not currently Year
         2000 compliant, the Company believes such IT systems will be Year 2000
         capable in a time frame that will avoid any material adverse effect on
         the Company. Also, the Company does not believe that the expenditures
         related to replacing or upgrading any of its IT systems to make them
         Year 2000 compliant will have a material adverse effect on the
         financial condition or results of operations of the Company. The
         Company has evaluated its critical equipment and critical systems that
         contain embedded software, ("Non-IT systems"), and the Company
         believes that all of its critical Non-IT systems are capable of
         functioning without substantial Year 2000 Compliance problems.

         The Company has engaged a leading computer consulting services firm to
         lead the Year 2000 remediation and testing process. The Company is
         also investigating each of its significant vendors, suppliers,
         financial service organizations, service providers and customers to
         confirm that the Company's operations will not be materially adversely
         affected by the failure of any such third party to have Year 2000
         compliant computer programs. Regardless of the responses that the
         Company receives from such third parties, the Company is establishing
         contingency plans to reduce the Company's exposure resulting from the
         non-compliance of third parties.

         The Company has approached the Year 2000 project in phases. Phase I of
         the project involved identification of all software used by the
         Company, identification of all significant vendors, and establishment
         of a senior management committee to oversee the project. Phase I was
         completed in the third calendar quarter of 1998. Phase II of the
         project involves (a) evaluation of each significant vendor and
         evaluation of major customers through letters and questionnaires (b)
         communication with customers concerning any products currently or
         recently sold by the Company that have Year 2000


                                      11
<PAGE>   12

         issues, and (c) evaluating the Company's most reasonably likely worst
         case Year 2000 scenarios and contingency planning related thereto.
         Phase II was completed in the first calendar quarter of 1999. Phase
         III involves testing of the Company's IT systems and Non-IT systems to
         confirm Year 2000 compliance and/or discover any overlooked Year 2000
         problems. Phase III has commenced and should be completed in the third
         calendar quarter of 1999. Last, Phase IV involves implementation of
         the Company's contingency plans. Such plans are expected to be
         implemented in the third calendar quarter of 1999.

         The Company has material relationships with third parties whose
         failure to be Year 2000 compliant could have materially adverse
         impacts on the Company's business, operations or financial condition
         in the future. Third parties that are considered to be in this
         category for Y2K purposes include critically important customers,
         suppliers, vendors and public entities such as government regulatory
         agencies, utilities, financial entities and others.

         The Company derives most of its net operating revenues from the
         transportation of new and used automobiles and light trucks for all
         major domestic and foreign automotive manufacturers. The Company has
         made Y2K awareness information available to all customers and has
         asked each customer to advise the Company of their plans for reaching
         Y2K readiness. The Company has also contacted the customers to inquire
         about actions being taken with respect to third parties. Further
         action may be taken by the Company as it deems appropriate in
         particular cases.

         The Company classifies as critical those suppliers of products or
         services that, if interrupted, would materially disrupt the Company's
         ability to conduct operations. The Company expects reviews of these
         products and service providers to be completed by the third quarter of
         1999.

         In the first calendar quarter of 1999, the Company began the planning
         and implementation of a Y2K program involving interaction with and
         assessment of public entities such as government regulatory agencies,
         utilities, financial entities and others.

         The Company is preparing contingency plans relating specifically to
         identify Y2K risks, and cost estimates relating to these plans are
         being developed. The Company began training designated employees in
         Y2K contingency planning matters during the first calendar quarter of
         1999, and anticipates completion of the Y2K contingency plans during
         the third calendar quarter of 1999. Contingency plans may include
         establishing alternative means of communicating with employees at
         terminal locations and with customers, and other appropriate measures.
         Once developed, Y2K contingency plans and related cost estimates will
         be continually refined, as additional information becomes available.

         While the Company currently believes that it will be able to modify or
         replace its affected systems in time to minimize any significant
         detrimental effects on its operations, failure to do so, or the
         failure of customers or other third parties to modify or replace their
         affected systems, could have materially adverse impacts on the
         Company's business, operations or financial condition in the future.
         There can be no guarantee that such


                                      12
<PAGE>   13

         impacts will not occur. In particular, because of the interdependent
         nature of business systems, the Company could be materially adversely
         affected if private businesses, utilities and governmental entities
         with which it does business or that provide essential products or
         services are not Year 2000 compliant. Reasonably likely consequences
         of failure by the Company or third parties to resolve the Y2K problem
         include, among other things, temporary slowdowns or cessation of
         delivery operations at one or more Company terminals, or delays in the
         delivery of vehicles. However, the Company believes that its Y2K
         readiness program, including related contingency planning, should
         significantly reduce the possibility of significant interruptions of
         normal operations.

         As of June 30, 1999, the Company's total incremental costs (historical
         plus estimated future costs) of addressing Y2K issues are estimated to
         be in the range of $5.0 million, of which approximately $3.5 million
         has been incurred. The Company believes that approximately 30% of the
         costs expected to be incurred in 1999 will be internal costs,
         including compensation and benefits of employees assigned primarily to
         Y2K procedures. Internal costs addressing Y2K issues during 1998 were
         not material. These costs are being funded through operating cash
         flow. These amounts do not include: (i) any costs associated with the
         implementation of contingency plans, which are in the process of being
         developed, or (ii) costs associated with replacements of computerized
         systems or equipment in cases where replacement was not accelerated
         due to Y2K issues.

         Implementation of the Company's Y2K plan is an ongoing process.
         Consequently, the above-described estimates of costs and completion
         dates for the various components of the plan are subject to change.

         The preceding discussion on Y2K contains various forward-looking
         statements that represent the Company's beliefs or expectations
         regarding future events. When used in the Y2K discussion, the words
         "believes," "expects," "estimates" and similar expressions are
         intended to identify forward-looking statements. Forward-looking
         statements include, without limitation, the Company's expectations as
         to when it will complete the remediation and testing phases of its Y2K
         procedures as well as its Y2K contingency plans; its estimated cost of
         achieving Y2K readiness; and the Company's belief that its internal
         systems and equipment will be Year 2000 ready in a timely manner. All
         forward-looking statements involve a number of risks and uncertainties
         that could cause the actual results to differ materially from the
         projected results. Factors that may cause these differences include,
         but are not limited to, the availability of qualified personnel and
         other information technology resources; the ability to identify and
         remediate all date sensitive lines of computer code or to replace
         embedded computer chips in affected systems or equipment; and the
         actions of governmental agencies or other third parties with respect
         to Y2K problems.

         The Company does not currently believe that any of the foregoing will
         have a material adverse effect on its financial condition or its
         results of operations. However, the process of evaluating the
         Company's third party vendors and their systems is ongoing. Although
         not expected, failures of critical suppliers, critical customers,
         critical IT systems or critical Non-IT systems could have a material
         adverse effect on the Company's financial condition or results of
         operations. As widely publicized, Year 2000 Compliance has


                                      13
<PAGE>   14

         many issues and aspects, not all of which the Company is able to
         accurately forecast or predict. There is no way to assure that Year
         2000 Compliance will not have adverse effects on the Company, some of
         which could be material.

         SEASONALITY AND INFLATION

         The Company's revenues are seasonal, with the second and fourth
         quarters generally experiencing higher revenues than the first and
         third quarters. The volume of vehicles shipped during the second and
         fourth quarters is generally higher due to the introduction of new
         models which are shipped to dealers during those periods and the
         higher spring and early summer sales of automobiles and light trucks.
         During the first and third quarters, vehicle shipments typically
         decline due to lower sales volume during those periods and scheduled
         plant shut downs. Inflation has not significantly affected the
         Company's results of operations.

         CAUTIONARY NOTICE REGARDING FORWARD-LOOKING STATEMENTS

         Statements in this quarterly report on Form 10-Q contains
         forward-looking statements, including statements regarding, among
         other items, (i) the Company's plans, intentions or expectations, (ii)
         general industry trends, competitive conditions and customer
         preferences, (iii) the Company's management information systems, and
         its ability to resolve any Year 2000 issues related thereto (iv) the
         Company's efforts to reduce costs, (v) the adequacy of the Company's
         sources of cash to finance its current and future operations and (vi)
         resolution of litigation without material adverse effect on the
         Company. This notice is intended to take advantage of the "safe
         harbor" provided by the Private Securities Litigation Reform Act of
         1995 with respect to such forward-looking statements. These
         forward-looking statements involve a number of risks and
         uncertainties. Among others, factors that could cause actual results
         to differ materially are the following: economic recessions or
         downturns in new vehicle production or sales; the highly competitive
         nature of the automotive distribution industry; dependence on the
         automotive industry; loss or reduction of revenues generated by the
         Company's major customers; the variability of quarterly results and
         seasonality of the automotive distribution industry; labor disputes
         involving the Company or its significant customers; the dependence on
         key personnel who have been hired or retained by the Company; the
         availability of strategic acquisitions or joint venture partners;
         changes in regulatory requirements which are applicable to the
         Company's business; changes in vehicle sizes and weights which may
         adversely impact vehicle deliveries per load; the ability to increase
         the rates charged to customers; risks associated with doing business
         in foreign countries; problems related to information technology
         systems and computations that must be made by the Company or its
         customers and vendors in 1999, 2000 or beyond; and the risk factors
         listed herein from time to time in the Company's Securities and
         Exchange Commission reports, including but not limited to, its Annual
         Reports on Form 10-K or 10 Q.


                                      14
<PAGE>   15

                                    PART II


                               OTHER INFORMATION




ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

         On May 12, 1999 the Annual Meeting of Shareholders was held. The
following Directors were elected for terms that will expire on the date of the
annual meeting in the year indicated below. The number of shares voted for,
against and abstentions are also indicated.



PROPOSAL I (ELECTION OF DIRECTORS)

<TABLE>
<CAPTION>

----------------------------------------------------------------------------------------------------
                                    FOR                  AGAINST                     TERM
----------------------------------------------------------------------------------------------------
<S>                                 <C>                  <C>                         <C>
Bernard O. De Wulf                  7,055,697            92,688                      2002
----------------------------------------------------------------------------------------------------
Guy W. Rutland, III                 7,055,697            92,688                      2002
----------------------------------------------------------------------------------------------------
Robert R. Woodson                   7,055,875            92,510                      2002
----------------------------------------------------------------------------------------------------
</TABLE>


         The following Directors' terms will continue as indicated.

<TABLE>

                                          <S>                           <C>
                                          Joseph W. Collier             2001
                                          Guy W. Rutland, IV            2001
                                          Randall E. West               2001
                                          Berner F. Wilson              2001
                                          William P. Benton             2000
                                          David G. Bannister            2000
                                          A. Mitchell Poole, Jr.        2000
                                          Robert J. Rutland             2000
</TABLE>

PROPOSAL II (APPROVAL OF THE 1999 EMPLOYEE STOCK PURCHASE PLAN)

<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------
                              FOR                        AGAINST                     ABSTAIN
---------------------------------------------------------------------------------------------------
<S>                           <C>                        <C>                         <C>
                              6,463,321                  669,859                     15,205
---------------------------------------------------------------------------------------------------
</TABLE>



PROPOSAL III (APPOINTMENT OF INDEPENDENT AUDITORS)

<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------
                              FOR                        AGAINST                     ABSTAIN
----------------------------------------------------------------------------------------------------
<S>                           <C>                        <C>                         <C>
                              7,141,155                  160                         7,070
----------------------------------------------------------------------------------------------------
</TABLE>


                                      15
<PAGE>   16

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K.

         (a)      Exhibits: 27.1  Financial Data Schedule (for SEC use only).

         (b)      Reports on Form 8-K: There were no reports filed on Form 8-K
                                       for the quarter ended June 30, 1999.


                                      16
<PAGE>   17

                                   SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

                                     Allied Holdings, Inc.



August 12, 1999                      /s/A. Mitchell Poole, Jr.
---------------                      -------------------------------
    (Date)                           A. Mitchell Poole, Jr.
                                     on behalf of Registrant as
                                     President, Chief Operating Officer,
                                     and Assistant Secretary




August 12, 1999                      /s/Daniel H. Popky
---------------                      -------------------------------
    (Date)                           Daniel H. Popky
                                     on behalf of Registrant as
                                     Senior Vice President, Finance
                                     and Chief Financial Officer


                                      17