ADESA's Pulse Provides Cautiously Optimistic Outlook For 2003.

Business Editors & Automotive Writers

INDIANAPOLIS--(BUSINESS WIRE)--Feb. 4, 2003

Used vehicle sales reached an all-time high in 2002, and the outlook for continued sales growth is good for 2003, according to the latest edition of Pulse, published by Indianapolis-based ADESA Corp., an ALLETE company (NYSE:ALE). The Pulse report also says the number of new vehicles sold in 2002 was the fourth-highest total ever recorded.

Strong new vehicle sales and zero-percent financing generated traffic and trade-ins that allowed franchised dealers to grow their used vehicle sales by over 500,000 units (3.3%). However, the report notes that used vehicle sales by independent dealers fell by 1.3 million units as a result. Including sales by private individuals, the total number of used vehicles sold nationally in 2002 topped 43 million, compared with the previous high of 42.6 million vehicles in 2001.

The latest Pulse report, which provides a macro-to-micro review of statistics relating to the $80 billion vehicle remarketing industry, suggests that recovering corporate profits, low inventories and aging equipment will help trigger increased business spending to aid the economic recovery in 2003. The report also concludes that despite declines in leasing, this new-car financing alternative continues to represent 23% of new vehicle sales, and ADESA Analytical Services does not expect lease penetration to fall below 20%.

"High trade-in volumes for franchised dealers and lower retail sales for independent dealers caused a decrease in demand for auction-sourced units in 2002," said Tom Kontos, vice president of industry relations and analytical services for ADESA Corp. and the report's author. "This exacerbated already soft market conditions resulting from high new vehicle incentives and still-strong off-lease volumes."

While prices in the used car market were significantly softer in 2002, the ADESA Dealer Optimism Index, confirmed that conversion rates (vehicles sold as a percentage of vehicles offered at auction) increased slightly in November and December, meaning that dealers purchased a greater percentage of vehicles offered for sale by other dealers at ADESA auctions than in November 2001. This increase reflects modestly improved prices at auction for dealer consignment units - especially when compared to the depressed levels of last year.

"In the previous issue of Pulse, we stated that the condition of the U.S. economy could be characterized by one word: uncertainty. We also projected that the economy would avert a "double-dip" recession, meaning that there would most likely be two recessions separated by a brief period of growth," Kontos said. "At the present juncture, while uncertainty remains, the threat of a double-dip recession has been downgraded to a "soft patch" in an otherwise promising recovery. We expect a more solid economic recovery and an early spring market for 2003."

ADESA Analytical Services, for the first time in this edition of Pulse also provides wholesale used vehicle price trends for 13 model class segments. Readers of the report will learn, for example, that full-size pickup prices increased by 2.1% in 2002, while compact car prices declined by 11.2%.

ADESA Analytical Services provides the publications Global Vehicle Remarketing and Pulse to its clients and industry contacts. To be placed on a subscription list and for additional, timely information relating to vehicle remarketing, visit ADESA's website under "The Industry's Pulse" (www.adesa.com/kontoskorner), or call [phone].

Headquartered in Indianapolis, Ind., ADESA Corp. is a wholly owned subsidiary of ALLETE, Inc. (NYSE:ALE). Through its network of subsidiaries, ADESA operates 53 wholesale vehicle auctions and six heavy-duty commercial vehicle auctions strategically located across the United States, Canada and Mexico. The ADESA network of services includes several other related businesses in the vehicle remarketing industry including ADESA Impact total loss management (with 26 auction locations), Micro 21 dealer software, AutoVIN inspection services, PAR North America remarketing services, Automotive Finance Corp. (AFC) and ADESA Importation Services (AIS). For further information on ADESA Corp., call 1-800-923-3725 or go to www.adesa.com.

The statements contained in this release and statements that ADESA may make orally in connection with this release that are not historical facts are forward-looking statements. Actual results may differ materially from those projected in the forward-looking statements. The forward-looking statements involve risks and uncertainties and investors are directed to the risks in documents filed by ALLETE, ADESA Corporation's parent company, with the Securities and Exchange Commission.