American Railcar Industries, Inc. Reports Record Earnings and Backlog for the Third Quarter.

Company Reaches Final Settlement of Insurance Claim

ST. CHARLES, Mo. -- American Railcar Industries, Inc. ("ARI") (NASDAQ: ARII) today reported its third quarter financial results.

For the three months ended September 30, 2006, revenues were $150.5 million, which is equivalent to revenues of $150.5 million for the same period of 2005. Revenues were negatively impacted in 2006 due to the Marmaduke tank railcar manufacturing plant being shut down and under repair for part of the quarter due to damage from a tornado that occurred on April 2, 2006. During the third quarter of 2006, ARI shipped 331 fewer tank railcars than the Company had planned before the tornado. The repairs at the Marmaduke plant are complete and the plant resumed production on August 7, 2006. The plant is currently operating at full production capacity. The negative impact that the Marmaduke shut down had on revenues was partially offset by a strong quarter for the covered hopper railcar manufacturing plant.

Net earnings attributable to common shareholders were $11.0 million or $0.52 per diluted share for the three months ended September 30, 2006, versus $3.4 million or $0.31 per diluted share for the comparable period of 2005. Third quarter results included $4.3 million of pre-tax gain recognized on the replacement of damaged and destroyed assets at the Marmaduke facility. In addition, net earnings for the quarter included $5.0 million of business interruption compensation from the Company's insurance carrier for lost profits while the tank railcar manufacturing plant was under repair. For the three months ended September 30, 2005, the Company declared preferred dividends of $2.1 million, which reduced 2005 net earnings available to common shareholders.

For the nine months ended September 30, 2006 revenues were $480.7 million versus $442.1 million for the comparable period of 2005. During the nine months ended September 30, 2006, ARI shipped 815 fewer tank railcars than the Company had planned before the tornado. The revenue increase was achieved in spite of the tank railcar manufacturing plant being shut down and under repair from April 2, 2006 through August 6, 2006, and resulted from strong growth in covered hopper railcar production and growth in the railcar services business.

Net earnings attributable to common shareholders were $28.5 million or $1.39 per diluted share for the nine months ended September 30, 2006, which compares favorably to net earnings attributable to common shareholders of $3.4 million or $0.30 per diluted share for the nine months ended September 30, 2005. The Company declared preferred dividends of $0.6 million and $11.2 million for the nine months ended September 30, 2006 and 2005, respectively. The preferred dividends reduced net earnings available to common shareholders. All of the Company's preferred stock and substantially all of its debt were retired in the first quarter of 2006 in connection with the Company's January 2006 initial public offering.

Earnings before interest, taxes, depreciation and amortization (EBITDA) was $20.5 million for the third quarter of 2006 and $11.7 million for the same quarter of 2005. For the nine months ended September 30, 2006 EBITDA was $54.2 million and compares favorably to the $31.2 million for the same period of 2005.

Adjusted EBITDA was $17.7 million in the third quarter of 2006 and $11.7 million for the same quarter of 2005. The adjustment to EBITDA for this period reflects the elimination of stock based compensation expenses of $1.5 million and the elimination of the gain on asset conversion of $4.3 million (pre-tax) for the involuntary replacement of assets damaged by the tornado in Marmaduke. Adjusted EBITDA for the nine months ended September 30, 2006 was $56.4 million compared to $31.2 million for the same period of 2005. Adjustments to EBITDA for this period include $6.6 million of stock based compensation expense primarily associated with our January 2006 initial public offering as well as the adjustment to exclude the gain on asset conversion of $4.3 million (pre-tax) for the involuntary replacement of assets damaged by the tornado in Marmaduke. The Company expects to incur an additional $1.5 million compensation expense, related to previous grants of restricted stock and stock options, in the fourth quarter of 2006.

The improvements in net earnings and EBITDA for the quarter resulted primarily from a gain on asset conversion related to our Marmaduke tank railcar manufacturing plant tornado damage and higher operating profits, some of which were the result of insurance compensation for lost profits. For the nine months, earnings and EBITDA were higher due to recovery of raw material cost increases through variable pricing clauses in our customer contracts, improved volumes, a gain on asset conversion and insurance compensation for lost profits related to our Marmaduke tank railcar manufacturing plant tornado damage. A reconciliation of the Company's net earnings to EBITDA and Adjusted EBITDA (both non-GAAP financial measures) is set forth in the supplemental disclosure attached to this press release.

ARI shipped 1,546 railcars in the third quarter of 2006. This compares to 1,635 railcars shipped in the third quarter of 2005. Third quarter 2006 shipments were comprised of 1,309 covered hopper railcars, 236 tank railcars and one intermodal railcar. In the same quarter of 2005, shipments were comprised of 1,107 covered hopper railcars and 528 tank railcars. Railcar production was lower in the quarter as a result of the Marmaduke plant closure for July and part of August.

"The Company had a very strong quarter, even though our tank railcar manufacturing plant was shut down until August 7, 2006," said James J. Unger, President and CEO of ARI. "Our backlog of unfilled orders for new railcars increased to a record total of 18,144 cars at September 30, 2006 compared to 12,790 cars at June 30, 2006. Our Marmaduke plant resumed operations on August 7, 2006. Since that plant re-opened, we saw tank railcar production steadily increase and reach capacity rates by the end of September. We expect the fourth quarter to be strong with good operating rates for covered hopper railcars and for our tank railcar manufacturing plant to be operating at capacity production rates for the quarter."

ARI will host a webcast and conference call on Thursday, November 9th, 2006 at 10:00 am (Eastern time) to discuss the Company's third quarter financial results. To participate in the webcast, please log on to ARI's investor relations page through the ARI web site at www.americanrailcar.com. To participate in the conference call dial 1-866-770-7129 and use participant code 25039900. Participants are asked to logon to the ARI website or dial in to the conference call approximately 10 to 15 minutes prior to the start time.

An audio replay of the call will also be available on the Company's website promptly following the earnings call.

About American Railcar Industries, Inc.

American Railcar Industries, Inc. is a leading North American manufacturer of covered hopper and tank railcars. ARI also repairs and refurbishes railcars, provides fleet management services and designs and manufactures certain railcar and industrial components used in the production of its railcars as well as railcars and non-railcar industrial products produced by others. ARI provides its railcar customers with integrated solutions through a comprehensive set of high quality products and related services.

Forward Looking Statement Disclaimer

This press release contains statements relating to our expected financial performance and/or future business prospects, events and plans that are "forward-looking statements" as defined under the Private Securities Litigation Reform Act of 1995. Forward-looking statements represent the Company's estimates and assumptions only as of the date of this press release. Such statements include, without limitation, statements regarding estimated future production rates, estimated fourth quarter results and statements regarding any implication that the Company's backlog may be indicative of future sales. These forward-looking statements are subject to known and unknown risks and uncertainties that could cause actual results to differ materially from the results described in or anticipated by our forward-looking statements. Estimated backlog reflects the total sales attributable to the backlog reported at the end of the particular period as if such backlog were converted to actual sales. Estimated backlog does not reflect potential price increases or decreases under our customer contracts that provide for variable pricing based on changes in the cost of certain raw materials and railcar components or the possibility that contracts may be canceled or railcar delivery dates delayed, and does not reflect the effects of any cancellation or delay of railcar orders that may occur. Other potential risks and uncertainties include, among other things: the cyclical nature of the railcar manufacturing business; adverse economic and market conditions; fluctuating costs of raw materials, including steel and railcar components, and delays in the delivery of such raw materials and components; ARI's ability to maintain relationships with its suppliers of railcar components and raw materials; fluctuations in the supply of components and raw materials ARI uses in railcar manufacturing; the highly competitive nature of the railcar manufacturing industry; the risk of further damage to our primary railcar manufacturing facilities or equipment in Paragould or Marmaduke, Arkansas; our reliance upon a small number of customers that represent a large percentage of our revenues; the variable purchase patterns of our customers and the timing of completion, delivery and acceptance of customer orders; our dependence on key personnel; the risks of labor shortage in light of our recent growth; the risk of lack of acceptance of our new railcar offerings by our customers; and the additional risk factors described in our filings with the Securities and Exchange Commission. We expressly disclaim any duty to provide updates to any forward-looking statements made in this press release, whether as a result of new information, future events or otherwise.

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EBITDA represents net earnings (loss) before income tax expense (benefit), interest expense (income), net of amortization and depreciation of property and equipment. We believe EBITDA is useful to investors in evaluating our operating performance compared to that of other companies in our industry. In addition, our management uses EBITDA to evaluate our operating performance. The calculation of EBITDA eliminates the effects of financing, income taxes and the accounting effects of capital spending. These items may vary for different companies for reasons unrelated to the overall operating performance of a company's business. EBITDA is not a financial measure presented in accordance with U.S. generally accepted accounting principles, or U.S. GAAP. Accordingly, when analyzing our operating performance, investors should not consider EBITDA in isolation or as a substitute for net earnings (loss), cash flows from operating activities or other statements of operations or statements of cash flow data prepared in accordance with U.S. GAAP. Our calculation of EBITDA is not necessarily comparable to that of other similarly titled measures reported by other companies.

Adjusted EBITDA represents EBITDA before stock based compensation expense related to a restricted stock grant and stock options and gain on asset conversion related to the involuntary replacement of assets damaged by the tornado in Marmaduke. We believe that Adjusted EBITDA is useful to investors evaluating our operating performance compared to that of other companies in our industry. In addition, these charges are excluded from our calculation of EBITDA under our revolving credit agreement entered into in January 2006 and amended in October 2006. Management also uses Adjusted EBITDA in evaluating our operating performance. Adjusted EBITDA is not a financial measure presented in accordance with U.S. GAAP. Accordingly, when analyzing our operating performance, investors should not consider Adjusted EBITDA in isolation or as a substitute for net income, cash flows from operating activities or other statements of operations or statements of cash flow data prepared in accordance with U.S. GAAP. Our calculation of Adjusted EBITDA is not necessarily comparable to that of other similarly titled measures reported by other companies.