IAM Ratifies Agreement with Pemco

Pemco Aviation Group, Inc. (NASDAQ:PAGI) announced today
that the International Association of Machinists and Aerospace
Workers, AFL-CIO Local Lodge No. 1632 (IAM), has ratified its
agreement with Pemco World Air Services, Inc. (PWAS), its Dothan,
Alabama facility. The three-year agreement will allow Pemco to move
forward with its strategic initiatives for maintenance and conversion
services in a more competitive manner.
   Michael Tennenbaum, Chairman of the Board of Pemco Aviation Group
stated, "The ratification of this Agreement was a signal to our
competitors that Pemco and its employees stand together in their
desire to provide the highest quality, most cost efficient products,
services and turn times in the MRO industry. The terms agreed upon
permit increased productivity and better utilization of the workforce.
Our stakeholders and investors have been served well by the employees
and the company in their negotiation of this agreement because it
creates improved job security and reasonable potential profits."
   Ronald Aramini, President of Pemco Aviation Group, Inc. commends
the agreement for the added value being provided to customers. "Not
only is this a pivotal moment for our employees and Pemco, but the
customer wins here as well. With the ratification of this agreement,
we have the resources, infrastructure and talent to grow further our
business. Our customers and potential customers are very pleased that
we are moving forward in this manner and we now expect to develop
significant new business."

   Pemco Aviation Group, Inc., with executive offices in Birmingham,
Alabama, and facilities in Alabama and California, performs
maintenance and modification of aircraft for the U.S. Government and
for foreign and domestic commercial customers. The Company also
provides aircraft parts and support and engineering services, in
addition to developing and manufacturing aircraft cargo systems,
rocket vehicles and control systems, and precision components. For
more information: www.pemcoaviationgroup.com.

   This press release contains forward-looking statements made in
reliance on the safe harbor provisions of Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the Securities
Exchange Act of 1934, as amended. These statements may be identified
by their use of words, such as "believe," "expect," "intend" and other
words and terms of similar meaning, in connection with any discussion
of the Company's prospects, financial statements, business, financial
condition, revenues, results of operations or liquidity. Factors that
could affect the Company's forward-looking statements include, among
other things: changes in global or domestic economic conditions; the
loss of one or more of the Company's major customers; the Company's
ability to obtain additional contracts and perform under existing
contracts; the outcome of pending and future litigation and the costs
of defending such litigation; financial difficulties experienced by
the Company's customers; potential environmental and other
liabilities; the inability of the Company to obtain additional
financing; material weaknesses in the Company's internal control over
financial reporting; regulatory changes that adversely affect the
Company's business; loss of key personnel; and other risks detailed
from time to time in the Company's SEC reports, including its Annual
Report on Form 10-K for the fiscal year ended December 31, 2004. The
Company cautions readers not to place undue reliance on any
forward-looking statements, which speak only as of the date on which
they are made. The Company does not undertake any obligation to update
or revise any forward-looking statements and is not responsible for
changes made to this release by wire services or Internet services.