 NYSE: NAV 1 4th Quarter 2010 Earnings Presentation December 22 nd , 2010 Exhibit 99.2 |
 NYSE: NAV 2 2 Safe Harbor Statement Information provided and statements contained in this presentation that are not purely historical are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995. Such forward-looking statements only speak as of the date of this presentation and the Company assumes no obligation to update the information included in this presentation. Such forward-looking statements include information concerning our possible or assumed future results of operations, including descriptions of our business strategy. These statements often include words such as “believe,” “expect,” “anticipate,” “intend,” “plan,” “estimate,” or similar expressions. These statements are not guarantees of performance or results and they involve risks, uncertainties, and assumptions. For a further description of these factors, see Item 1A, Risk Factors, included within our Form 10-K for the year ended October 31, 2010, which was filed on December 21, 2010. Although we believe that these forward-looking statements are based on reasonable assumptions, there are many factors that could affect our actual financial results or results of operations and could cause actual results to differ materially from those in the forward-looking statements. All future written and oral forward-looking statements by us or persons acting on our behalf are expressly qualified in their entirety by the cautionary statements contained or referred to above. Except for our ongoing obligations to disclose material information as required by the federal securities laws, we do not have any obligations or intention to release publicly any revisions to any forward- looking statements to reflect events or circumstances in the future or to reflect the occurrence of unanticipated events. |
 NYSE: NAV 3 3 Other Cautionary Notes • The financial information herein contains audited and unaudited information and has been prepared by management in good faith and based on data currently available to the Company. • Certain Non-GAAP measures are used in this presentation to assist the reader in understanding our core manufacturing business. We believe this information is useful and relevant to assess and measure the performance of our core manufacturing business as it illustrates manufacturing performance without regard to selected historical legacy costs (i.e. pension and other postretirement costs). It also excludes financial services and other expenses that may not be related to the core manufacturing business. Management often uses this information to assess and measure the performance of our operating segments. A reconciliation to the most appropriate GAAP number is included in the appendix of this presentation. |
 NYSE: NAV 4 4 Agenda • 4Q financials • Full-year • Strategic update • Driving shareowner value |
 NYSE: NAV 5 5 What We Said on the 3 rd Quarter Call for Full Year 2010 *This slide contains non-GAAP information, please see the Reg G in appendix for detailed reconciliation Guidance Actual Truck Industry Units 190,000 to 195,000 191,300 Revenue ($ Billions) 12.2 to 12.5 12.1 ($ Millions (excluding EPS)) Mfg. Segment Profit* 750 to 800 741** Below the line items* (525) to (534) (495) Profit Excluding Tax 225 to 266 246 Net Income attributable to NIC 202 to 238 223 Tax Rate 10% to 11% 9.4% Diluted EPS attributable to NIC $2.75 to $3.25 $3.05** # of shares ~73.3M 73.2M **FY2010 includes $10M ($0.14) of cost for UAW agreement $751 $3.19 |
 NYSE: NAV 4Q Operations Overall segment margins strong • UAW agreement expenses - One time items - Move production to Escobedo • Product development expense - 4Q 2010 $126M vs. $94M in 4Q 2009 - Launched TerraStar™ Australia India • Military Parts revenue - 4Q 2010 $96M vs. $213M in 4Q2009 Equity in (loss) income of non- consolidated affiliates • JV investment - 4Q2010 ($18M) vs. ($10M) in 4Q2009 9800 CT630 CT610 40T/49T 31T 9 10 DT 7 11 13 Brazil 2010 emission engines 6 |
 NYSE: NAV 7 75,800 86,900 22,700 24,800 0 10,000 20,000 30,000 40,000 50,000 60,000 70,000 80,000 90,000 100,000 FY 2009 FY 2010 Q409 Q410 167,800 215,500 51,300 57,600 101,500 24,900 39,600 0 50,000 100,000 150,000 200,000 250,000 300,000 FY 2009 FY 2010 4Q09 4Q10 4Q2010 and Full Year Information Consolidated Revenues ($ in millions) Yearly and Quarterly Truck Chargeouts Yearly and Quarterly Engine Shipments Q/Q Chargeouts increased ~9% Q/Q Shipments decreased ~37% Y/Y Shipments decreased ~11% Y/Y Chargeouts increased ~15% - Ford 269,300 240,400 90,900 $11,569 $12,145 $3,285 $3,372 $0 $2,000 $4,000 $6,000 $8,000 $10,000 $12,000 $14,000 FY 2009 FY 2010 Q409 Q410 Q/Q Revenues increased ~3% Military Revenues ($ in millions) $400 $495 $213 $96 $0 $100 $200 $300 $400 $500 $600 $700 4Q 2009 4Q 2010 Truck Parts $613 $591 |
 NYSE: NAV 8 8 2007 Product Offerings 2011 Product Offerings Well Positioned for Future Purchased Engines 7 7 DT DT 9 9 10 10 9900 SCHOOL BUS 9200 / 9400 Global Powertrain 7.2L 9.3L 4.8L 9 10 DT 7 11 13 JAC JV and NEOBUS JV are pending. |
 NYSE: NAV 9 9 Medium Truck Great Products – Market Share Severe Service Truck Heavy Truck FY07 60% FY08 55% FY09 61% FY10 59% FY07 36% FY08 36% FY09 35% FY10 38% FY07 25% FY08 27% FY09 34% FY10 33% FY07 15% FY08 19% FY09 25% FY10 24% Class 8 School Bus (U.S. & Canada) School Bus & Combined Class 6-8 Market Share – FY08: ; FY09: ; FY10: Note: Market Share based on brand and Severe Service Truck market share excludes military FY07 18% FY08 22% FY09 28% FY10 26% |
 NYSE: NAV 10 10 2010 U.S. and Canada Heavy Strategy – Maintain 25% Class 8 Share MaxxForce ® 13L • Successfully transitioning customers to 13L • Current run rate up to 110 per day, moving to 200 per day • Run rate will increase throughout 2011 to coincide with industry demand • Industry converting to 13L engines MaxxForce ® 15L • Now accepting orders • EPA certification has been submitted in October • Customer delivery starts in January 2011 • Additional high volume applications will be phased in through April 2011 with marketing push at Mid-America Truck Show 2010 Strategy • Convert customers to the MaxxForce ® 13L • Drive customer – pre/post buy |
 NYSE: NAV 11 11 • Moving from focused facilities to flexible manufacturing to minimize logistics cost • School bus: All assembly in Tulsa • Huntsville – ability to produce V8/I6/DT engines on same line What’s next? • Engineering Competitive Cost Structure EAP GAP CAP SAP TBP HEP CBP MPP Product Development FY 2009 FY 2010 $433M $464M $94M Q4 2010 product development was $126M |
 NYSE: NAV 12 12 Competitive Cost Structure New Labor Agreement/Integrated Product Development Center Ft. Wayne Ft. Wayne Engineering Center Engineering Center Melrose Park Melrose Park Future • Capitalize on integration at lower cost • Increase shareowner value Strategy • Labor agreement • Leveraging assets • Integrated Product Development Center Past/Present |
 NYSE: NAV 13 13 Navistar Defense Sustainable Revenue 2008 2009 2010 2011 > $2B > $2B > $2B $1.5-$2.0B • U.S. and FMS $1.3B Continue at lower rate (-) • Foreign Direct $0.3B U.K./Canada/26 countries (+/-) • Parts & Services $0.5B Continue w/more vehicles (+/-) • Capability Insertion $0.1B Increasing (+) • Total $2.2B 250 MaxxPro Recovery Vehicles 175 MaxxPro Dash w/ DXM Heavy Truck Tractors New customer – Navy Seabees 2011 Goal ~$400M in awards within last three months Recent Wins: |
                     NYSE: NAV 14 14 Top 15 Countries International Market Global Defense Budgets 1. China 2. United Kingdom 3. France 4. Japan 5. Saudi Arabia 6. Germany 7. India 8. Italy 9. Russia 10. S. Korea 11. Brazil 12. Canada 13. Australia 14. Spain 15. Turkey Iran Colombia Israel Netherlands Poland Taiwan Greece Singapore United Arab Emirates Sweden Norway Pakistan Egypt Algeria Belgium Thailand Switzerland Oman Chile Denmark 50 Countries (Including US) Define 87% of the Global Defense Marketplace; 13 of top 15 Accessible to US Defense Companies Domestic US Markets Accessible International Markets Excluded International Markets Copyright © Jane’s Information Group Inc., 2010. All rights reserved. Next in Rank |
 NYSE: NAV 15 15 School Bus Class 6 and 7 Combined Class 8 Engines Class 4 and 5 Existing Platforms + Survivability Solutions = Success Existing Platforms + Survivability Solutions = Success Navistar Defense Leveraging Platforms |
 NYSE: NAV 16 16 India India Latin America Latin America 40T/49T 25T Tipper 31T South Africa South Africa 2011 Global Truck Australia Australia CT630 CT610 Brazil Brazil 9800 |
 NYSE: NAV 17 17 2011 Global Truck |
 NYSE: NAV 18 A. J. Cederoth – EVP & CFO • Strategy • Manufacturing cash update • NFC liquidity remains strong • Driving shareowner value - Managing legacy costs - Realizing tax value • Results will flow with recovery • Thoughts for 2011 |
 NYSE: NAV 19 Strategy - Leveraging What We Have and What Others Have Built Note: This slide contains non-GAAP information, please see the Reg G in appendix for detailed reconciliation. |
 NYSE: NAV 4Q Manufacturing Cash Update Note: This slide contains non-GAAP information, please see the Reg G in appendix for detailed reconciliation. 20 ($ millions) July 31, 2010 ending manufacturing cash 1 $757 Manufacturing EBITDA $123 Change in net working capital 2 $308 Capital expenditures ($85) Other cash flows ($3) October 31, 2010 ending manufacturing cash 1 $1,100 1 Includes marketable securities and cash from the consolidation of non-controlling minority interests (includes $49 million and $16 million of cash and cash equivalents at July 31 and October 31, 2010, respectively, from BDP and BDT) 2 NWC = A/R, Inventory, Other Current Assets, A/P & Other Current Liabilities |
 NYSE: NAV 21 21 Navistar Financial Corporation (NFC) - Leveraging Assets & Controlling Our Destiny • Liquidity is strong: $719M - Dealer floor plan structures refinanced with > $529M of liquidity • Retail portfolio allied with GE Capital - Navistar Capital fully integrated • FY 2010 profitability of $95M and leverage has improved (7:1) Retail Notes Bank Facility • $815M of availability remaining – Funding for retail notes, wholesale notes, retail accounts, and dealer open accounts – Matures December 2012 On balance sheet • Situation as of Oct 31, 2010 – ~$1.1B funding facility (NFSC) – $529M available • NFSC wholesale trust – Bank conduit portion renewed August 2010 – Public portions mature January 2012 and October 2012 On balance sheet • Broaden product offering • Enhanced ability to support large fleets Note: $95 million of profitability is for total financial services |
 NYSE: NAV 22 22 Control Below the Line • FY2010 actual expense: $142M • FY2011 not expected to be exceed FY2010 expense • Fiscal year pension returns were 17.5% • Pension Relief Act benefits funding • FY2010 actual expense: $37M • Continued dialogue around long term solution • OPEB underfunded balance was reduced in 2010 by $505M • Managed through 2010 product transition • Global strategy will present new challenges, value of partners • 2011 opportunities • 2011 tax rate expected to be between 13% and 18% • Long-term outlook - potential to consume NOL • Value of deferred tax assets will have positive impact on balance sheet |
 NYSE: NAV 23 Positioned to Take Advantage of Industry Recovery Note: This slide contains non-GAAP information, please see the Reg G in appendix for detailed reconciliation. FY2008 FY2009 FY2010 Defense Revenues $3.9B $2.9B $2.2B Engines sold to Ford (in units) 125K 102K 25K Post Retirement Benefit (Costs) $42M ($233M) ($179M) JV Investments (start-up costs) NA ($20M) ($55M) |
 NYSE: NAV 24 24 Thoughts for FY 2011 Full Year Timing North America Industry + Recovering Throughout the Year Market Share + Building Experience in 1st Half / Gains in 2nd Half - Class 4/5 + - Class 6/7 + - Class 8 - / + Core Business Performance + + Trends with Volume Global Growth + Volume Growth as Distribution Expands Military Revenue - / + $1.5B - $2.0B Engine + OEM Volume Growth - South America – / + Sustain South America Parts + Continued Growth Facility Integration Engineering Integration / Transition – Labor UAW, Chatham |
 NYSE: NAV 25 25 Investor & Analyst Day - January 25, 2011 Reservation Required Navistar’s Investor & Analyst Day Tuesday, January 25, 2011 Melrose Park Engine Facility Melrose Park, IL 10:30 a.m. – 3 p.m. CST Lunch, Presentation with Q&A Plant Tour, Lab Demos & Product Displays Reservation Required Please contact Suzanne Sorensen at Suzanne.Sorensen@Navistar.com to RSVP JAC JV and NEOBUS JV are pending 7.2L 4.8L 9 10 DT 7 11 13 9.3L |
 NYSE: NAV 26 Appendix |
 NYSE: NAV 27 27 4Q2010 and Full Year Information: Profitable at all points in the cycle Quarterly Manufacturing Segment Profit ($ in millions) Quarterly Diluted Earnings (loss) per share $1.19 $0.54 $0.00 $0.20 $0.40 $0.60 $0.80 $1.00 $1.20 $1.40 4Q09 4Q10 $232 $146 $0.00 $50.00 $100.00 $150.00 $200.00 $250.00 4Q09 4Q10 2009 2010 Military Revenue $613M $591M Truck $400M $495M Parts $213M $96M World Wide Chargeouts 22,800 24,800 Ford Engine Volume (US/Can) 39,600 0 Product Development Cost $94M $126M UAW Agreement Costs N/A $10M 2009 2010 Military Revenue $2,941M $2,151M Truck $2,121M $1,820M Parts $820M $331M World Wide Chargeouts 75,800 86,900 Ford Engine volume - full Year (US/Can) 101,500 24,900 Product Development Cost $433M $464M UAW Agreement Costs N/A $10M Full Year Fourth Quarter |
 NYSE: NAV 28 28 Market Share – U.S. & Canada School Bus and Class 6-8 Navistar 1st Q 2nd Q 3rd Q 4th Q Full Year 1st Q 2nd Q 3rd Q 4th Q Full Year 1st Q 2nd Q 3rd Q 4th Q Full Year Bus (School) 57% 57% 48% 58% 55% 56% 60% 61% 66% 61% 60% 63% 52% 59% 59% Medium (Class 6-7) 34% 35% 39% 35% 36% 30% 39% 33% 39% 35% 33% 44% 36% 37% 38% Heavy (LH & RH) 16% 15% 19% 25% 19% 24% 23% 29% 24% 25% 23% 22% 30% 20% 24% Severe Service 28% 26% 26% 29% 27% 32% 36% 33% 33% 34% 34% 35% 35% 29% 33% Combined Class 8 20% 19% 21% 26% 22% 26% 27% 30% 27% 28% 26% 26% 31% 22% 26% Combined Market Share 27% 27% 28% 32% 29% 30% 35% 36% 36% 34% 31% 35% 34% 30% 33% 2010 Market Share - U.S. & Canada School Bus and Class 6-8 2008 2009 |
 NYSE: NAV 29 29 Truck Chargeouts Note: Information shown below is based on Navistar’s fiscal year Fiscal year 2008 1Q08 2Q08 3Q08 4Q08 Full Year 2008 BUS 3,100 3,300 2,700 4,400 13,500 MEDIUM 3,700 6,300 5,800 4,500 20,300 HEAVY 2,600 3,900 4,500 7,800 18,800 SEVERE 2,400 3,400 3,300 3,700 12,800 TOTAL 11,800 16,900 16,300 20,400 65,400 MILITARY (U.S. & Foreign) 1,600 2,200 2,300 2,600 8,700 EXPANSIONARY 5,900 8,100 8,400 5,700 28,100 WORLD WIDE TRUCK 19,300 27,200 27,000 28,700 102,200 Fiscal year 2009 1Q09 2Q09 3Q09 4Q09 Full Year 2009 BUS 2,700 3,100 3,500 4,500 13,800 MEDIUM 3,200 3,400 2,700 3,700 13,000 HEAVY 6,100 3,200 4,500 5,300 19,100 SEVERE 2,800 2,700 2,800 2,600 10,900 TOTAL 14,800 12,400 13,500 16,100 56,800 MILITARY (U.S. & Foreign) 2,500 2,100 1,200 2,000 7,800 EXPANSIONARY 2,400 1,900 2,300 4,600 11,200 WORLD WIDE TRUCK 19,700 16,400 17,000 22,700 75,800 Fiscal year 2010 1Q10 2Q10 3Q10 4Q10 Full Year 2010 BUS 3,100 3,100 2,300 3,900 12,400 MEDIUM 3,900 5,300 3,900 5,400 18,500 HEAVY 5,200 4,600 6,400 5,400 21,600 SEVERE 3,100 3,000 1,800 2,800 10,700 TOTAL 15,300 16,000 14,400 17,500 63,200 MILITARY (U.S. & Foreign) 900 900 1,600 1,200 4,600 EXPANSIONARY 3,900 4,500 4,600 6,100 19,100 WORLD WIDE TRUCK 20,100 21,400 20,600 24,800 86,900 |
 NYSE: NAV 30 30 World Wide Engine Shipments Navistar 1st Q 2nd Q 3rd Q 4th Q Full Year OEM sales - South America 27,600 33,800 34,500 36,700 132,600 Ford sales - U.S. and Canada 41,400 48,000 18,600 16,500 124,500 Other OEM sales 3,200 4,200 4,900 6,500 18,800 Intercompany sales 13,600 16,500 21,200 18,300 69,600 Total Shipments 85,800 102,500 79,200 78,000 345,500 Navistar 1st Q 2nd Q 3rd Q 4th Q Full Year OEM sales - South America 19,400 22,500 26,100 31,200 99,200 Ford sales - U.S. and Canada 12,600 26,400 22,900 39,600 101,500 Other OEM sales 4,500 2,400 1,800 2,600 11,300 Intercompany sales 14,400 12,600 12,800 17,500 57,300 Total Shipments 50,900 63,900 63,600 90,900 269,300 Navistar 1st Q 2nd Q 3rd Q 4th Q Full Year OEM sales - South America 30,700 34,600 33,600 33,900 132,800 Ford sales - U.S. and Canada 24,700 200 - - 24,900 Other OEM sales 2,000 3,600 3,700 4,900 14,200 Intercompany sales 16,400 17,700 15,600 18,800 68,500 Total Shipments 73,800 56,100 52,900 57,600 240,400 2010 2008 2009 |
 NYSE: NAV 31 31 Order Receipts – U.S. & Canada Percentage Percentage 2010 2009 Change Change 2010 2009 Change Change 3,200 9,100 (5,900) (65) 7,800 18,300 (10,500) (57) 5,200 7,100 (1,900) (27) 17,700 15,100 2,600 17 Class 8 heavy trucks 4,100 7,000 (2,900) (41) 20,200 19,900 300 2 Class 8 severe service trucks 2,200 3,700 (1,500) (41) 10,000 11,100 (1,100) (10) 14,700 26,900 (12,200) (45) 55,700 64,400 (8,700) (14) 6,300 10,700 (4,400) (41) 30,200 31,000 (800) (3) The three and twelve months ended October 31, 2009 have been recast to exclude 200 and 3,000 units, respectively, related to U.S. military contracts to reflect our new methodology for categorization of “traditional” units. Total "Traditional" Markets Combined Class 8 (Heavy and Severe Service) "Traditional" Markets School buses Class 6 and 7 medium trucks Twelve Months Ended October 31, Order Receipts: U.S. & Canada (Units) Three Months Ended October 31, |
 NYSE: NAV 32 32 International Dealer Stock Inventory (Units) * U.S. and Canada Dealer Stock Inventory *Includes U.S. and Canada Class 4-8 and school bus inventory, but does not include U.S. IC Bus or Workhorse Custom Chassis inventory. |
 NYSE: NAV 33 33 Frequently Asked Questions Q1: Why did the Company disclose that it revised its previous financial statements? A: In Q4, the Company identified errors that originated in periods prior to 2008. The errors included: (i) an understatement of our net obligation for pension benefits of $25 million due to our actuarially computed projected benefit obligations for pensions not measuring certain benefits, (ii) an understatement of our asbestos claims reserve of $9 million for a mechanical error in the actuarial model used to calculate our reserve, and (iii) an understatement of our reserve for certain disability programs for our Canadian operations of $16 million due to an error in the application of the accounting guidance for defined benefits and a related understatement of our deferred tax assets of $5 million. These errors resulted in the understatement of our accumulated deficit and accumulated other comprehensive loss of $29 million and $16 million, respectively, at October 31, 2009. The corrections are not considered material to any previously reported consolidated financial statements. The 2009 and 2008 impact of these errors, totaling $10 million, was recognized in our results for 2010 as they were not material to our financial results for 2009 and 2008. We have revised our previously reported Consolidated Balance Sheet as of October 31, 2009 and Consolidated Statements of Stockholders’ Deficit for the years ended October 31, 2009 and 2008 to reflect the correction of errors identified in those statements. The revisions did not impact the Consolidated Statements of Cash Flows for those periods. |
 NYSE: NAV 34 34 Frequently Asked Questions Q2: How does vertical integration of a big bore engine impact warranty? A: With the transition to 100% MaxxForce engines we will assume an increased responsibility for engine warranty, which was previously absorbed by our suppliers and reflected in our material costs. The impact of this change will increase warranty expense and decrease material costs. Q3: What is the breakdown of your South American engine business in 2010 (broken down by automotive, agricultural/other, and truck)? What do you expect your breakout to be in 2012? A: Q4: What is in your Dealcor debt? A: Dealcor debt is comprised of wholesale (floor plan) financing and also retail financing on lease and rental fleets for company owned dealers. Q5: How many Dealcor dealers did you have as of October 31, 2010? A: Of our 276 primary NAFTA dealers, we have ownership interest in 11 DealCor dealers as of October 31, 2010. We expect to further reduce our number of Dealcor dealers in 2011. Application 2010 FY 2012 FY Pick-ups & SUVs 35% 30% Trucks 23% 24% Tractors 20% 9% Buses 11% 22% Industrial 5% 7% GenSets 5% 6% |
 NYSE: NAV 35 35 Frequently Asked Questions Q6: Are there any requirements for NFC leverage? A: NFC is compliant with our revolver leverage covenant of 6 to 1. This ratio calculation excludes qualified retail and lease securitization debt. Q7: How do you fund your wholesale business? A: We primarily finance our wholesale portfolio in traditional private or public securitizations, and through our bank facility. Q8: How are your dealers doing? A: We think our dealers, which have always been one of our strengths, are well positioned. We traditionally have not had any significant dealer losses and expect that trend to continue in the future. Q9: What kind of rates do you charge your dealers and customers? A: Generally, our rates vary (those with higher credit risk have always had to pay higher interest rates) and are usually in line with the market. Q10: How is your NFC portfolio performing? A: Repossessions, past due accounts and losses peaked in 2008 and have continued to show improvement. NFC portfolio performance improved considerably in 2010, which has resulted in a lower provision for losses. |
 NYSE: NAV 36 36 Frequently Asked Questions Q11: What is your total amount of capacity at NFC? A: Total availability in our funding facilities is more than $719 million as of October 31, 2010. Q12: What is the status of the retail financing alliance with GE Capital in the United States? A: Navistar Capital – the alliance we formed with GE Capital to support the sale of Navistar products – is off to a great start and progressing consistent with expectations. Q13: Why have NFC’s wholesale receivables and debt moved onto the balance sheet? A: NFC amended its wholesale securitization trust to allow NFC some control over receivables transferred to the trust, which is a variable interest entity of which NFC is the primary beneficiary. Under current accounting rules, the amendment requires NFC to consolidate the assets and liabilities of the wholesale securitization trust onto the balance sheet. Q14: How does the latest Ground Combat Vehicle (GCV) program announcement affect Navistar? A: Navistar was not originally part of the GCV program. Recently, the Army announced it would cancel the contract solicitation and issue a revised Request for Proposal (RFP). Navistar will evaluate potential opportunities once the RFP has been issued. Q15: What is the current Joint Light Tactical Vehicle (JLTV) program status? A: As part of the Technology Development (TD) phase, Navistar and BAE delivered right-hand drive prototypes to Australia on June 21 following delivery of prototypes to the U.S. in May. |
 NYSE: NAV 37 37 Frequently Asked Questions Q16: What is the status of any MaxxPro ® Dash rolling chassis orders? A: At this time, we stand ready to support any needs from the military should they choose to retrofit the remainder of the MaxxPro fleet with DXM™ independent suspension. To date, Navistar has been contracted to produce 1,305 MaxxPro Dash units with DXM independent suspension and is currently retrofitting another 1,222 Dash units in theater with the capability. Recently, the company also received an order for 250 of the new MaxxPro Recovery MRAP variant. Q17: What are your margins for military vehicles? A: We do not break margins out specific to our military vehicles. These numbers are reported as part of our Truck Group financials. Q18: What are the 2010 emissions requirements? A: The rules allow manufacturers to go to a maximum of 0.50 NOx if they reduced earlier with advanced technology; manufacturers need to be at 0.20 NOx if they chose not to introduce advanced technologies to reduce their emissions earlier. Q19: What will Navistar do to meet the 0.20 NOx emissions when its credits are depleted? A: Navistar remains committed to its strategy of providing solutions that let customers focus on their business, not emissions regulations. Solutions under development are multi-pronged and include our prime path of in-cylinder solutions along with application-specific solutions such as the Amminex metal ammine-based NOx reductant delivery system which Navistar announced in December 2009. |
 NYSE: NAV 38 38 Frequently Asked Questions Q20: How much net operating losses remain, and why is there still a valuation allowance against deferred tax assets? A: The Company has U.S. federal net operating losses available as of October 31, 2010 with an undiscounted cash value of $161 million. In addition, we have state NOLs valued at $85 million and foreign NOLs valued at $85, for a total undiscounted cash value of $331 million. (The $25 million reduction in our financial statement NOL deferred tax component relates to stock option accounting.) A substantial portion of these NOL assets are subject to a valuation allowance. In addition to the deferred tax assets attributable to the NOLs, we have other deferred tax assets arising from temporary book- tax differences subject to a valuation allowance, for a total balance of deferred tax assets subject to a valuation allowance of $1.8 billion. Under U.S. GAAP rules, when the Company is able to demonstrate sufficient earnings (both historically and in the future) to absorb these future deductions, the Company will release its valuation allowances. If U.S. operations continue to improve, we believe it is reasonably possible that the Company may release all or a portion of its U.S. valuation allowance in the next twelve months. When we release the valuation allowance, $49 million would favorably impact paid in capital and the balance would favorably impact net income. |
 NYSE: NAV 39 39 Frequently Asked Questions Q21: How has recent tax legislation affected Navistar? A: The Worker, Homeownership, and Business Assistance Act of 2009 provided an opportunity to carry back alternative minimum tax net operating losses from the Company’s 2010 fiscal year and to receive a refund of alternative minimum tax (AMT) payments made in the prior five fiscal years. The Company expects to receive a refund of $29 million of AMT credits as a result of this legislation. The Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 (the Tax Relief Act) extends current tax rules in several areas, which if not extended, could have adversely impacted the Company’s tax results. In addition, the Act provides the opportunity for businesses to fully depreciate qualifying property purchased through the end of 2011 (50% first year depreciation for purchases in 2012), which could benefit both Navistar and its customers. Q22: What makes up our consolidated tax expense? A: Our pre-tax operating profits reflect our worldwide operations; similarly our consolidated tax expense reflects the impact of differing tax positions throughout the world. In general, we currently have full valuation allowances against the deferred tax assets of our U.S. and Canadian operations. Consequently, our tax expense in those jurisdictions is generally limited to current state or local taxes and the impact of alternative minimum taxes. In 2010 we reported a refund of $29 million in AMT credits which we expect to receive in 2011. Our Brazilian and Mexican operations are profitable and as a result we accrue taxes in those jurisdictions. This combination of factors contributes to our low overall consolidated effective tax rate. Q23: What contributed to the $14 million decrease in income tax expense as compared to 2009? A: The decrease in tax expense was primarily driven by the $29 million refund of U.S. alternative minimum tax, offset by increases in our foreign taxes as a result of higher foreign income. |
 NYSE: NAV 40 40 Frequently Asked Questions Q24: Your tax footnote in the 10K discloses gross deferred tax assets of $1.9 billion. How will those assets be used to offset future taxable income? A: Simply put, deferred tax assets represent the value of future tax deductions attributable to items that have already been expensed or deducted for book purposes. The most commonly understood component of deferred tax assets is the value of our net operating losses, which will serve to reduce taxable income in the future. In addition, we have several other major components of deferred taxes which will reduce taxable income in the future. For example, the Company has accrued significant OPEB, pension and other employee benefit expenses during prior years based on expected payments to be made in the future. As these payments are made, the Company will realize tax deductions to the extent of its future taxable income. Q25: What is your expected 2010 pension and OPEB GAAP expense? A: Assuming no further containment actions and no curtailment events, we anticipate 2011 pension and OPEB GAAP expense will not exceed 2010 levels. Q26: What are your expected 2011 and beyond pension funding requirements? A: Current forecasts indicate that we may need to contribute approximately $180 million in 2011. We believe the recently enacted pension funding relief legislation Preservation of Access to Care for Medicare Beneficiaries and Pension Relief Act of 2010 will materially reduce the amount of required cash contributions into our major US defined benefit plans over the next five years. Although certain specific regulations related to funding relief have not yet been defined, we anticipate that minimum required cash contributions will be reduced between $300 and $400 million for the year 2012 through 2014 compared with our estimate of minimum required cash contributions before funding relief. |
 NYSE: NAV 41 41 Frequently Asked Questions Q27: What causes the variance between manufacturing cash interest payments and GAAP interest expense? A: The main variance between cash and GAAP interest results from the recent issuance of new manufacturing debt. In October 2009, our manufacturing company issued $1 billion of senior unsecured high yield notes and $570 million of senior subordinated convertible notes. As a result of this issuance, future manufacturing interest expense will be higher than cash interest payments due to the amortization of debt issuance costs which are amortized over the life of each note ($36 million), amortization of the original issue discount of the high yield notes ($37 million) and amortization of the embedded call option in the convertible notes ($114 million). In FY 2010, this variance is much larger due to the timing of interest payments on the high yield notes. Interest payment dates are in May and November starting in May 2010. Therefore, we had only one cash payment this fiscal year even though expense will show the full year amount. As a result of this and other non-cash interest expense, FY 2010 shows a variance of approximately $79 million between cash and GAAP interest. Q28: What are the $225 million of Recovery Zone Facility Revenue Bonds (RZFB) Series 2010 due October 15, 2040 being used for? A: We are using the proceeds to invest in our product development strategy and our HQ consolidation. Great products are a key pillar of our three pronged strategy. Streamlining and improving our product development processes will continue to provide competitive advantages for us in the marketplace. The funding from RZFB will allow us to consolidate many facilities into a new facility and make necessary renovations to that facility. Additionally we will invest in an existing facility, which includes investments in equipment and technology that will help us create and improve our product development process and thus shareholder value. |
 NYSE: NAV Frequently Asked Questions Q29: Why did you use RZFB financing? A: The recovery zone facility bonds are a cost effective, long-term form of capital that is complementary to our capital structure. The bonds have a 30 year maturity and a fixed rate coupon of 6.50% per annum. They are callable at par any time after 10 years (October 15, 2020). Issuing bonds in the tax-exempt market gave us exposure to a new source of investors that we wouldn’t otherwise have access to if not for the Recovery Zone Facility Bond program. Q30: What should we assume for capital expenditures in fiscal 2011? A: We plan to continue capital spending within the traditionally guided range of $250 - $350 million for products and development. There is capital spending related to Product Development Consolidation not included in the range that is fully funded through Recovery Zone Bonds. Q31: How do you think about accounting vs. economic dilution on your convertible debt? A: Please see the presentation on the IR website (http://ir.navistar.com/dilution.cfm ) entitled Dilution overview resulting from the Convertible Notes issued on October 2009. Q32: How does your Class 8 industry compare to A: ACT Research? Reconciliation to ACT ACT* 199,737 199,737 CY to FY adjustment (20,000) (16,000) Other misc. specialty vehicles Included in ACT (8,500) (5,000) Total (ACT comparable Class 8 to Navistar) 171,237 178,737 Navistar Industry Retail Deliveries Combined Class 8 Trucks 160,000 172,000 Navistar difference from ACT: 11,237 6,737 *Source: ACT N.A. Commercial Vehicle Outlook - December 10th, 2010 * * Navistar will update this number at the January 25th Analyst Day U.S. and Canadian Class 8 Truck Sales 2011 42 |
 NYSE: NAV ($ in millions) Note: This slide contains non-GAAP information, please see the Reg G in appendix for detailed reconciliation FYTD Manufacturing Cash Flow Beginning Mfg. Cash¹ Balance Fiscal 2007 Fiscal 2008 Fiscal 2009 YTD - FY 2010 October 31, 2006 $1,214 October 31, 2007 $722 October 31, 2008 $777 October 31, 2009 $1,152 Approximate Cash Flows: From Operations ($231) $414 $514 $409 Dividends from NFC $400 $15 $0 $0 From Investing / (Cap Ex) ($200) ($220) ($284) ($350) From Financing / (Debt Pay Down) ($480) ($133) $56 ($110) Exchange Rate Effect $19 ($21) $9 ($1) Net Cash Flow ($492) $55 $295 ($52) Blue Diamond Consolidation $0 $0 $80 $0 Ending Mfg. Cash¹ Balance: October 31, 2007 $722 October 31, 2008 $777 October 31, 2009² $1,152 April 30, 2010² $1,100 1 Cash = Cash, Cash Equivalents & Marketable Securities 2 Includes cash from the consolidation of non-contolling minority interests 43 |
 NYSE: NAV 44 44 SEC Regulation G This presentation is not in accordance with, or an alternative for, U.S. generally accepted accounting principles (GAAP). The non-GAAP financial information presented herein should be considered supplemental to, and not as a substitute for, or superior to, financial measures calculated in accordance with GAAP. However, we believe that non-GAAP reporting, giving effect to the adjustments shown in the reconciliation above, provides meaningful information and therefore we use it to supplement our GAAP reporting by identifying items that may not be related to the core manufacturing business. Management often uses this information to assess and measure the performance of our operating segments. We have chosen to provide this supplemental information to investors, analysts and other interested parties to enable them to perform additional analyses of operating results, to illustrate the results of operations giving effect to the non-GAAP adjustments shown in the above reconciliations and to provide an additional measure of performance. DEBT October 31, 2010 October 31, 2009 (in millions) Manufacturing operations 8.25% Senior Notes, due 2021, net of unamortized discount of $35 and $37 million at the respective dates 965 $ 963 $ 3.0% Senior Subordinated Convertible Notes, due 2014, net of unamortized discount of $99 and $114 at the respective dates 476 456 Debt of majority owned dealership 66 148 Financing arrangements and capital lease obligations 221 271 Loan Agreement related to 6.5% Tax Exempt Bonds, due 2040 225 Other 33 23 Total manufacturing operations debt 1,986 $ 1,861 $ Less: Current portion (145) (191) Net long-term manufacturing operations debt 1,841 $ 1,670 $ Financial services operations Asset-backed debt issued by consolidated SPEs, at variable rates, due serially through 2018 1,731 $ 1,227 $ Bank revolvers, at fixed and variable rates, due dates from 2010 through 2016 974 1,518 Revolving retail warehouse facility, at variable rates, due 2010 - 500 Commercial Paper, at variable rates, due serially through 2011 67 52 Borrowing secured by operating and finance leases, at various rate, due serially through 2017 112 134 Total financial services operations debt 2,884 $ 3,431 $ Less: Current portion (487) (945) Net long-term financial services operations debt 2,397 $ 2,486 $ Cash & Cash Equivalents October 31, 2010 October 31, 2009 Manufacturing non-GAAP (Unaudited) 534 $ 1,152 $ * Financial Services non-GAAP (Unaudited) 51 60 Consolidated US GAAP (Audited) 585 $ 1,212 $ Manufacturing Cash & Cash Equivalents non-GAAP (Unaudited) 534 $ 1,152 $ * Manufacturing Marketable Securities non-GAAP (Unaudited) 566 - Manufacturing Cash, Cash Equivalents & Marketable Securities non-GAAP (Unaudited) 1,100 $ 1,152 $ *Includes cash and cash equivalents from consolidating Blue Diamond Truck and Blue Diamond Parts |
 NYSE: NAV 45 45 SEC Regulation G Three Months Ended October 31, 2010 ($ millions) Net income (loss) attributable to NIC 39 $ Add back income taxes 6 Income before income taxes 45 $ Less equity income from financial service operations (33) Income before income taxes and equity income from financial service operations 12 $ Add back manufacturing interest expense 38 Manufacturing EBIT 50 $ Add back manufacturing depreciation and amortization 1 73 Adjusted manufacturing EBITDA 123 $ 1 Includes depreciation of equipment leased to others and excludes debt issuance cost/discount amortization |
 NYSE: NAV 46 46 SEC Regulation G – Fiscal Year Comparison Manufacturing Segment Profit is not in accordance with, or an alternative for, U.S. generally accepted accounting principles (GAAP). The non-GAAP financial information presented herein should be considered supplemental to, and not as a substitute for, or superior to, financial measures calculated in accordance with GAAP. However,we believe that non-GAAP reporting, giving effect to the adjustments shown in the reconciliation above, provides meaningful information and therefore we use it to supplement our GAAP reporting by identifying items that may not be related to the core manufacturing business. Management often uses this information to assess and measure the performance of our operating segments. We have chosen to provide this supplemental information to investors, analysts and other interested parties to enable them to perform additional analyses of operating results, to illustrate the results of operations giving effect to the non-GAAP adjustments shown in the above reconciliations and to provide an additional measure of performance. Future 2009 U.S. and Canada Industry 414,500 350,000 ($billions) Sales and revenues, net $ 15 + $ 20 + ($millions) Manufacturing segment profit* $ 1,600 Below the line items Income excluding income tax Income tax expense (298) Net Income attributable to Navistar International Corporation (NIC) Diluted earnings per share ($'s) attributable to NIC $12.31 Weighted average shares outstanding: diluted (millions) Original Target @ 414.5k Industry Revised Target @ 350k Industry $ 1,780 (590) ~ 72.5 $892 ~ 72.5 (500) 1,100 (275) $825 $11.46 1,190 |
 NYSE: NAV SEC Regulation G – Fiscal Year Comparison This presentation is not in accordance with, or an alternative for, U.S. generally accepted accounting principles (GAAP). The non-GAAP financial information presented herein should be considered supplemental to, and not as a substitute for, or superior to, financial measures calculated in accordance with GAAP. However, we believe that non-GAAP reporting, giving effect to the adjustments shown in the reconciliation above, provides meaningful information and therefore we use it to supplement our GAAP reporting by identifying items that may not be related to the core manufacturing business. Management often uses this information to assess and measure the performance of our operating segments. We have chosen to provide this supplemental information to investors, analysts and other interested parties to enable them to perform additional analyses of operating results, to illustrate the results of operations giving effect to the non-GAAP adjustments shown in the above reconciliations and to provide an additional measure of performance. 2009 2008 Non GAAP Non GAAP Non GAAP Non GAAP As Reported Non GAAP Non GAAP As Reported Non GAAP Non GAAP As Reported Without All Impacts Other Impacts Without UAW Impacts UAW Impacts With Impacts Without Impacts Impacts With Impacts Without Impacts Impacts With Impacts U.S. and Canada Industry 191,300 181,800 244,100 ($billions) Sales and revenues, net 12.1 $ 11.6 $ 14.7 $ ($millions) Manufacturing segment profit * (excluding items listed below) 725 $ - $ 725 $ - $ 725 $ 707 $ - $ 707 $ 1,088 $ - $ 1,088 $ Ford settlement net of related charges - 27 27 - 27 - 160 160 - (37) (37) UAW Expenses - - - (11) (11) - - - - - - Impairment of property, plant and equipment - - - - - - (31) (31) - (358) (358) Manufacturing segment profit 725 27 752 (11) 741 707 129 836 1,088 (395) 693 Below the line items (excluding items listed below) (496) $ - $ (496) $ - $ (496) $ (468) - (468) (502) - (502) UAW Expenses - - - 1 1 - - - - - - Write-off of debt issuance cost - - - - - - (11) (11) - - - Below the line items (496) - (496) 1 (495) (468) (11) (479) (502) - (502) Income (loss) excluding income tax 229 27 256 (10) 246 239 118 357 �� 586 (395) 191 Income tax benefit (expense) (23) - (23) - (23) (34) (3) (37) (58) 1 (57) Net Income (loss) attributable to Navistar International Corporation 206 $ 27 $ 233 $ (10) $ 223 $ 205 $ 115 $ 320 $ 528 $ (394) $ 134 $ Diluted earnings (loss) per share ($'s) attributable to Navistar International Corporation 2.82 $ 0.37 $ 3.19 $ (0.14) $ 3.05 $ 2.86 $ 1.60 $ 4.46 $ 7.21 $ (5.39) $ 1.82 $ Weighted average shares outstanding: diluted (millions) 73.2 73.2 73.2 73.2 73.2 71.8 71.8 73.2 73.2 * Includes: non-controlling minority interest in net income of subsidiaries net of tax; extraordinary gain net of tax 2010 47 |