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[CHAMPION ENTERPRISES, INC. LETTERHEAD]


FOR IMMEDIATE RELEASE


INVESTOR AND MEDIA CONTACTS:

Joseph H. Stegmayer                         Elizabeth M. Higashi, CFA
Chief Financial Officer                     Investor Relations
(248) 340-9090                              (847) 304-1655


                      CHAMPION ENTERPRISES, INC. ANNOUNCES
                   PLANS TO ADDRESS INDUSTRY INVENTORY ISSUES
                      SECOND HALF EPS DOWN AN ESTIMATED 40%

         AUBURN HILLS, MICHIGAN, AUGUST 26, 1999 --- CHAMPION ENTERPRISES, INC.
(NYSE: CHB) announced today its plans to address a number of current industry
issues. The industry's excess retail inventory has created a very competitive
market at both the wholesale and retail levels. This situation is expected to
reduce Champion's second half earnings approximately 40 percent below last
year's $1.03 per diluted share, excluding the previously announced third quarter
$0.41 per share one-time charge.

         Chairman, President and CEO, Walter R. Young said, "While industry
retail sales to consumers are apparently stable, the number of homes in the
industry's channels has ballooned out of balance for several reasons. The result
is that the industry is experiencing a period of reduced wholesale shipments and
competitive pressures at both the retail and wholesale levels until the
industry-wide inventories get back in balance. The primary reason for the excess
inventory is that the growth of retail locations has outpaced total demand. It
now appears that a major reduction in the number of retailers is beginning and
will cause changes in the industry's distribution patterns."

         Young continued, "In response to these industry issues, we are
aggressively attacking on both the retail and manufacturing levels. On the
manufacturing side, we are dedicated to being the best and lowest cost
manufacturer. During the past 30 days, we have consolidated five of our least
productive plants into existing operations. We have created new home models and
service and marketing programs that are intended to improve customer
satisfaction and market share. The cost of these programs will also reduce
margins over the next nine months."

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         "Our retail organization continues to grow profitably under these
conditions. The quality organizations we have acquired and internally expanded
over the past two years have their inventories at acceptable levels. We will
continue to expand where we have strong management available and see
opportunities. However, retail margins will be affected by the competitive
market conditions as well as by the start-up expenses of new locations," Young
said.

         In conclusion, Young added, "We are taking positive, aggressive steps
to capitalize on the industry's temporary situation. However, the expenses of
these steps and the increased competitive conditions will impact our margins and
earnings through next Spring. Even with the profitable growth of our retail
operations, we anticipate earnings for the second half of 1999 to be
approximately 40 percent below last year, excluding the one-time third quarter
charge. Nevertheless, we expect that through this accelerated period of
consolidation, Champion will emerge in an even greater position of strength and
profitability."

         Champion Enterprises, Inc., headquartered in Auburn Hills, Michigan,
has produced more than 1.4 million homes in its 46-year history, including more
than 70,000 homes in 1998. Champion has 61 home building facilities operating in
18 states and western Canada. In addition to 288 company-operated sales centers,
Champion homes are sold by 3,500 independent retail locations, which include
approximately 700 locations that have joined the "Alliance of Champions"
marketing program. Further information on Champion can be found using the
company's web sites at www.champent.com and www.thehousingplace.com.

         This news release contains certain statements, including discussions of
the company's earnings estimates, retail and manufacturing strategies and goals
for further improving and expanding operations, which could be construed to be
forward looking statements within the meaning of the Securities and Exchange Act
of 1934. These statements reflect the company's views with respect to future
plans, events and financial performance. The company has identified certain risk
factors which could cause actual results and plans to differ substantially from
those included in the forward looking statements. These factors are discussed in
the company's Form 10-Q for the period ending July 3, 1999, and this discussion
regarding risk factors is incorporated herein by reference.

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