Navistar International 8K Navistar Reports Improved 2Q Adjusted Net Income; Narrows | NAV 7 Jun 11

NYSE: NAV

2 Quarter 2011 Earnings Call

June 7, 2011

2nd Quarter 2011 Earnings Presentation

June 7, 2011

EXHIBIT 99.2

NYSE: NAV

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

obligation

update

the

information

included

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.

2 Quarter 2011 Earnings Call

June 7, 2011

NYSE: NAV

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.

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 or underlying results.

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.

2 Quarter 2011 Earnings Call

June 7, 2011

2 Quarter 2011 Earnings Call

June 7, 2011

Results While Building

•

Q2 financials

•

Strategic update

•

Driving

shareowner

value

Continued Success in 2011

Adjusted

Diluted

EPS

attributable

NIC

$5.50-$6.00

Note: This slide contains non-GAAP information, please see the REG

G in appendix for a detailed reconciliation. 2011 FY Guidance

does not include Engineering Integration Impact or potential

Valuation Allowance release.

Flexible Manufacturing Strategy

NYSE: NAV

NYSE: NAV

Product Introductions/Launches

MaxxPro

Dash

Ambulance

TerraStar™

4x4

Sloped Nose WorkStar

CAT CT660 –

Introduced at ConExpo in March

ProStar+

with

MaxxForce

PayStar

with

MaxxForce

LoneStar

with

MaxxForce

MN25 Tankers at Work

2 Quarter 2011 Earnings Call

June 7, 2011

EPA /CARB certification

–

MaxxForce

DT lowered

from 0.50 to 0.39 NOx

–

MaxxForce

9/10 lowered

from 0.50 to 0.45 NOx

–

MaxxForce

NYSE: NAV

$0.60

$1.02

$0.00

$0.20

$0.40

$0.60

$0.80

$1.00

$1.20

Q2 2010

Q2 2011

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 a detailed reconciliation. 2011 FY Guidance

does not include Engineering Integration Impact or potential

Valuation Allowance release.

Key Takeaways for Q2

Truck production volume up ~34% Q2 over Q1

Class 8 Market Share better than initially expected

Prior period warranty includes expense of $27 million/diluted

EPS effect of $0.34

Expect to perform at high end of guidance

FY 2011

Truck Industry

Units

51,700

61,200

112,900

Revenue ($Billions)

$2.7

$3.4

$6.1

Adj. Mfg. Segment

Profit* ($Millions)

$98

$171

$269

Adj. Diluted EPS

Attributable to NIC*

$0.18

$1.02

$1.22

***

Weighted average

shares outstanding

(Diluted)

75.9

78.6**

77.3

MaxxPro

Tractor

*Excludes

2011 Engineering Integration Costs and

includes

$0.34 of prior period warranty adjustment

**Guidance based off 77.6M shares

Quarterly Adjusted Diluted Earnings

Per Share

***

YTD Earnings Per Share (EPS) of $1.22 will not equal the sum of Q1 EPS ($0.18) and Q2 EPS ($1.02)

2 Quarter 2011 Earnings Call

June 7, 2011

NYSE: NAV

$2,385

$2,848

$358

$507

$500

$1,000

$1,500

$2,000

$2,500

$3,000

$3,500

$4,000

Q2 2010

Q2 2011

Base

Military

$298

$390

$60

$117

$100

$200

$300

$400

$500

$600

Q2 2010

Q2 2011

Truck

Parts

16,000

17,400

5,400

8,200

5,000

10,000

15,000

20,000

25,000

30,000

Q2 2010

Q2 2011

Traditional

Expansionary

Q2 2011 Information

Consolidated Revenues

($ in millions)

Quarterly Truck Chargeouts

Quarterly Engine Shipments

Military Revenues

($ in millions)

21,400

25,600

$358

$507

$2,743

$3,355

21,500

27,900

34,600

37,100

10,000

20,000

30,000

40,000

50,000

60,000

70,000

Q2 2010

Q2 2011

All Other

OEM Sales South America

56,100

65,000

2 Quarter 2011 Earnings Call

June 7, 2011

NYSE: NAV

Medium

Truck

Great Products –

Market Share

Severe Service

Truck

Heavy

Truck

FY09

61%

FY10

59%

Q2 11

45%

YTD11

48%

FY09

35%

FY10

38%

Q2 11

36%

YTD11

36%

FY09

34%

FY10

33%

Q2 11

33%

YTD11

31%

FY09

25%

FY10

24%

Q2 11

16%

YTD11

16%

Class 8

School

Bus

(U.S. & Canada)

School

Bus

Combined

Class

6-8

Market

–

FY09:

34%;

FY10:

33%;

YTD11:

26%

Note: Market Share based on brand and Severe Service Truck

market share excludes military

20% Market Share

Q2 11

Class 4-5

YTD11

Industry

17K

Navistar

549

Market Share

~3%

2 Quarter 2011 Earnings Call

June 7, 2011

U.S. and Canada Heavy Strategy –

Maintain ~25% Class 8 Share

Severe Service Truck

Heavy Truck

Combined Class 8

Attributes

•Fuel

•Durability

•Weight

•Driver performance

ProStar

with

MaxxForce

WorkStar

with

MaxxForce

FY2010

1Q -

2Q 2011

ProStar

with

MaxxForce

2 Half 2011

Sloped Nose

WorkStar

PayStar

with

MaxxForce

LoneStar

with

500HP MaxxForce

9900 with

MaxxForce

CAT CT660

Class 8 Strategy

What We’ve Said

•

Convert to

proprietary U.S. and

Canada diesel

engine

•

Transition industry

from 15L to 13L

•

Customer

experience during

transition will drive

increased second

half momentum

2 Quarter 2011 Earnings Call

June 7, 2011

NYSE: NAV

NYSE: NAV

Combined

Class 8

Half

FY2011

Industry

75K

96K –

109K

171K -

184K

Navistar

15K

27K -

31K

42K -

46K

Market Share

~19%

~28%

~25%

Note: Market Share based on brand and Severe Service Truck

market share excludes military

2011 U.S. and Canada Combined Class 8 Strategy –

Maintain ~25% Class 8 Share

Key Takeaways/What’s Next?

•

Launch of derivative products to complete line-up

•

Truck production split

95% -

13L

5% -

15L

•

15L

impact

will

weighted

toward

quarter

ProStar+

with

MaxxForce

LoneStar

with

MaxxForce

Industry

FY02

FY03

FY04

FY 05

FY06

FY 07

FY08

FY09

FY10

School Bus

27,400

29,200

26,200

26,800

28,200

24,500

24,400

22,600

20,900

16,500

18,000

Class 6-7 - Medium

72,700

74,900

99,200

104,600

110,400

88,500

59,600

39,800

46,400

52,500

58,000

Combined Class 8 (Heavy & Severe Service)

163,300

159,300

219,300

282,900

316,100

206,000

152,600

112,000

124,000

171,000

184,000

Total Industry Demand

263,400

344,700

414,300

454,700

319,000

236,600

174,400

191,300

240,000

260,000

FY 11

Actual

Guidance

Historical Information

United States and Canadian Class 6-8 Truck Industry - Retail Sales Volume

2 Quarter 2011 Earnings Call

June 7, 2011

NYSE: NAV

2011 Global Truck

South America

•

Colombia

•

Brazil

Peru

Mexico

Global Units

FY 2010

FY 2011

Mexico

5,000

6,000

Latin America/

Australia/

South America

3,000

10,000

Key Takeaways

•

Global units are expected to

increase by >60% from the first

half to the second half of this year

•

Balance global growth with

supplier capacity

Australia

2 Quarter 2011 Earnings Call

June 7, 2011

9800 &

DuraStar

TranStar

WorkStar

CT610/CT630

ProStar

40T

Currently 410 Branded

Sales or Service Points

NYSE: NAV

2 Quarter 2011 Earnings Call

June 7, 2011

Navistar Defense Sustainable Revenue

2008

2009

2010

2011+

> $2B

~$1.9B

Units since 2005

NYSE: NAV

Navistar Defense Recent Wins

250 MaxxPro

Dash Ambulances

160 Buses

265 GTTs

RPG Net

Dash and Recovery

FSR

MaxxPro

Dash

2 Quarter 2011 Earnings Call

June 7, 2011

NYSE: NAV

•

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

•

Labor agreement

Competitive Cost Structure

Completed Actions

Next Steps to increase Shareholder Value

•

Leveraging assets

•

Integrated Product Development

Center

Half

2 Half

Fiscal

Year 2011

UAW one time impacts

($7M)

Manufacturing

Flexibility Efficiency

$33M

~$50M

~$80M

Product Development

($266M)

($240M-

$260M)

(>$500M)

2 Quarter 2011 Earnings Call

June 7, 2011

NYSE: NAV

$10

$12

$14

$16

YTD

Full Year Guidance

$0.0

$1.0

$2.0

$3.0

$4.0

$5.0

$6.0

$7.0

YTD

Full Year Guidance

FY 2011 Guidance

Navistar Consolidated Revenues ($ in Billions)

Navistar Adjusted Diluted EPS

YTD

$6.1

Guidance

$13.6 –

$14.3

Half

Fiscal

Year 2011

Traditional NA Industry

113K

147K

260K

Class 8

Market Share

19%

~28%

~25%

Engine Profitability

($6M)

~$100M

OEM Diesels

73K

~86K

>150K

Military Revenues

$840M

>$1B

~$1.9B

UAW One Time Impacts

($7M)

Manufacturing Flexibility

Efficiency

$33M

~$50M

~$80M

Product Development

($266M)

($240M-$260M)

(>$500M)

Parts Segment Growth

>10% CAGR

YTD

$1.22**

Guidance

$5.50 –

$6.00**

*Composed mostly of NC2 & MNAL JV

Note: This slide contains non-GAAP information, please see the REG

G in appendix for a detailed reconciliation. 2011 FY Guidance

does not include Engineering Integration Impact or potential

Valuation Allowance release.

**Excludes 2011 Engineering Integration Costs

GLOBAL

Half

Fiscal Year

2011

Equity/loss from non-

consolidated affiliates*

($33M)

($10M-$15M)

($40M-

$50M)

Global units

(incl. Legacy, NC²

& MNAL)

~20K

~29K

2 Quarter 2011 Earnings Call

June 7, 2011

Results While Building

•

Q2 financials

•

Strategic update

•

Driving

shareowner

value

Continued Success in 2011

Adjusted Diluted EPS attributable to NIC -

$5.50-$6.00

Note: This slide contains non-GAAP information, please see the REG

G in appendix for a detailed reconciliation. 2011 FY Guidance

does not include Engineering Integration Impact or potential

Valuation Allowance release.

2 Quarter 2011 Earnings Call

June 7, 2011

NYSE: NAV

Flexible Manufacturing Strategy

NYSE: NAV

Q2 Manufacturing Cash Update

Note: This slide contains non-GAAP information, please see the Reg G in appendix for detailed reconciliation.

Note: Capital Expenditures includes ~$16M related to Integrated

Product Development center

2 Quarter 2011 Earnings Call

June 7, 2011

($ millions)

January 31, 2011 ending manufacturing cash and marketable securities

$762

Adjusted manufacturing EBITDA

$151

Change in net working capital

$228

Capital expenditures

($90)

Other cash flows

$28

April 30, 2011 ending manufacturing cash and marketable securities

$1,079

Forecasted October 31, 2011 ending manufacturing cash and marketable securities

$1.2B to $1.4B

Includes cash from the consolidation of minority interests

NWC = A/R, Inventory, Other Current Assets, A/P & Other Current Liabilities

Navistar Financial Corporation

•

Q2 2011 profitability of $40M, YTD profitability of $72M

•

Liquidity is strong: $517M total availability as of 4/30/11

–

Retail securitization in April increased liquidity $118M and reduced borrowing costs

•

Retail portfolio originations and balances will continue to decline as Navistar

Capital (new GE Capital program) handles new acquisitions

•

Service leverage stable (6:1)

Retail Notes

Bank Facility

•

$810M facility

–

Funding for retail notes,

wholesale notes, retail

accounts, and dealer open

accounts

–

Matures December 2012

On balance sheet

•

Situation as of Apr 30, 2011

–

$1.1B funding facility (NFSC)

–

$350M available

•

NFSC wholesale trust

–

Bank conduit portion matures

August 2011

–

Public portions mature

January 2012 and October

2012

On balance sheet

•

Broader product offering

•

Enhanced ability to support

large fleets

•

Better access to less

expensive capital

Note: profitability relates to total financial services

Leveraging Assets & Controlling Our Destiny

2 Quarter 2011 Earnings Call

June 7, 2011

NYSE: NAV

NYSE: NAV

Truck /Bus

Production

Facilities:

SAP, GAP,

EAP, TBP

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

45,000

5,000

10,000

15,000

20,000

25,000

30,000

Medium

Combined Class 8

100

150

200

250

300

350

Operating Days

2011 Update

Worldwide Truck Chargeouts

half

–

498

days

half –

572 days

•

Medium

production

expected to

increase 10-

15% in the

half

•

Combined

Class 8

production

expected to

be up >40%

OEM

Engine

Sales

(excludes

inter-company

shipments)

half –

73K units

half –

86K units

U.S. and Canada Truck Production

Note: Worldwide Truck Charge outs include towables. There are

approximately 4,000 forecasted units in FY 2011.

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

45,000

50,000

2011 Actuals

2011 Forecast

Traditional

Expansionary

Towables

2 Quarter 2011 Earnings Call

June 7, 2011

NYSE: NAV

Results –

Vehicle Integration Drives

Profitable Growth

Drivers of Success

Market share growth –

ProStar

success

Product breadth –

Big Bore engines

Customer reach –

dealer engagement

(U.S., Canada, Mexico, excludes Military)

Parts

Segment

Three Months Ended April 30:

($ in millions)

2011

2010

$ change

% change

Total Sales

$562

$447

$115

26%

Segment

$74

$58

$16

28%

North American Parts Sales

Parts Financial Information

2 Quarter 2011 Earnings Call

June 7, 2011

$500

$1,000

$1,500

$2,000

2009

2010

2011 Fcst

NYSE: NAV

Competitive Cost Structure

Controlling our Destiny

Note:

Costs related to steel, precious metals, resins, and

petroleum products

Commodities

Market Profile

2009

Average

2010

High

March 11

(data shown in Q1)

May 2011

Sheet steel

($/short ton)

$482

$699

$861

$810

Scrap steel

($/long ton)

$260

$473

$480

$490

Crude oil

($/bbl)

$62

$91

$95

$101

Platinum

($/troy oz.)

$1,203

$1,754

$1,829

$1,792

Natural

Rubber

($/lb)

$0.82

$2.25

$2.34

$2.10

Copper

($/lb)

$2.41

$4.23

$4.55

$4.05

2011 Actions

•

Navistar has mitigated a

significant portion of 2011 market

risk

–

Systematic hedging

–

Supplier negotiations

–

Commodity surcharges

•

Within a range, commodity

volatility has been factored into

2011 guidance

•

Focus on FY2012

•

Pricing Actions

2 Quarter 2011 Earnings Call

June 7, 2011

NYSE: NAV

FY 04 --

04' EPA

FY 07 --

07 EPA

FY 08 --

07' EPA

FY 09 --

07 EPA

FY 9/10 --

10 EPA

Current Build Est

FY 07

FY 08

FY 09

FY 10

Current Build

Est

Warranty

Big Bore Engine Shipments By Year

Key Takeaways

•

Prior period cost associated with

previous generation products /

customer satisfaction

•

Warranty expense will grow as engine

population expands

Base

Engine

–

Midrange

Diesels

Truck

–

ProStar

Launch Years

2,000

4,000

6,000

8,000

10,000

12,000

14,000

FY2008

FY2009

FY2010

YTD2011

2 Quarter 2011 Earnings Call

June 7, 2011

NYSE: NAV

FY 2011 Guidance

•

Industry remains strong

–

Full Year 240K to 260K

–

half ~226K

half ~300K (annualized)

•

Market Share

–

Growing with experience

–

Product performance

•

Fuel economy

•

Quality

–

15L Engine

•

Challenges

–

Commodities –

contained

–

Product investments

•

Global business

–

Completing investments

–

Volumes are growing

–

Export is very strong

*composed

mostly

MNAL

Half

Fiscal

Year 2011

Traditional NA Industry

113K

147K

260K

Class 8

Market Share

19%

~28%

~25%

Engine Profitability

($6M)

~$100M

OEM Diesels

73K

~86K

>150K

Military Revenues

$840M

>$1B

~$1.9B

UAW One Time Impacts

($7M)

Manufacturing Flexibility

Efficiency

$33M

~$50M

~$80M

Product Development

($266M)

($240M-$260M)

(>$500M)

Parts Segment Growth

>10% CAGR

GLOBAL

Half

Fiscal Year

2011

Equity/loss from non-

consolidated affiliates*

($33M)

($10M-$15M)

($40M-$50M)

Global units

(incl. Legacy, NC²

& MNAL)

~20K

~29K

Deliver on our commitments

•

Expect high side of EPS guidance

•

FY 2011 manufacturing cash and

marketable securities: $1.2B to $1.4 B

2 Quarter 2011 Earnings Call

June 7, 2011

NYSE: NAV

Driving Shareholder Value

Deliver on our commitments

•

Expect high side of EPS guidance

•

2011

manufacturing

cash

$1.2B

$1.4B

Not Included:

•Engineering Integration Costs

•Valuation Allowance

•Mfg Footprint Rationalization

2 Quarter 2011 Earnings Call

June 7, 2011

$(5.00)

$5.00

$10.00

$15.00

$20.00

$25.00

150

200

250

300

350

400

450

500

Current wedge asumes attainment of mature global

growth by the end of calendar year 2013

Original wedge assumed a share count of 72.5M

shares and a Tax Rate of 25%.

2009

Actual *

Notes:

*2008

and

2009

exclude

certain

charges,

see

Reg.

Traditional

Industry

Volume

(Thousands

Units)

G in Appendix for GAAP reconcilation

**Please see 2011 Guidance Slide in Appendix for

additional assumptions

2010

Actual

2008

Actual *

Original $1.6B Segment

Profit

Goal

415k

units

$1.8B Segment Profit

Goal

@ 350k

units

Appendix

2 Quarter 2011 Earnings Call

June 7, 2011

NYSE: NAV

NYSE: NAV

2011 Guidance

** FY2010 includes $10M ($0.14) of cost for UAW agreement

*** 2011 Guidance does not include Engineering Integration Impact or potential Valuation Allowance release

2010 Actual Guidance ***

2 Quarter 2011 Earnings Call

June 7, 2011

*This slide contains non-GAAP information, please see the Reg G in appendix for detailed reconciliation.

Truck Industry Units

191,300

240,000

260,000

Revenue ($ Billions)

$12.1

$13.6

$14.3

($ Millions (excluding EPS))

Adj. Mfg. Segment Profit*

$741

$995

$1,070

Fin. Services, Corporate, Elims*

$(496)

$(520)

$(550)

Adj. Profit Excluding Tax*

$246

$475

$520

Adj. Net Income attributable to NIC*

$223

$427

$465

Tax Rate

9.4%

10%

11%

Adj. Diluted EPS attributable to NIC*

$3.05**

$5.50

$6.00

Number of diluted shares

73.2M

~77.6M

Cash ($ Billions)

$1.1

$1.2 to $1.4

NYSE: NAV

Market Share –

U.S. & Canada School Bus and Class 6-8

2 Quarter 2011 Earnings Call

June 7, 2011

Navistar

Full Year

Bus (School)

56%

60%

61%

66%

61%

60%

63%

52%

59%

51%

45%

48%

Medium (Class 6-7)

30%

39%

33%

39%

35%

33%

44%

36%

37%

38%

36%

Heavy (LH & RH)

24%

23%

29%

24%

25%

23%

22%

30%

20%

24%

17%

16%

Severe Service

32%

36%

33%

34%

35%

29%

33%

29%

33%

31%

Combined Class 8

26%

27%

30%

27%

28%

26%

31%

22%

26%

19%

20%

19%

Combined Market Share

30%

35%

36%

34%

31%

35%

34%

30%

33%

26%

2011

Market Share —

U.S. & Canada School Bus and Class 6-8

2010

2009

NYSE: NAV

Worldwide Truck Chargeouts

Fiscal year 2009

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

Full Year 2010

BUS

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

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

Fiscal year 2011

Full Year 2011

BUS

2,000

2,100

4,100

MEDIUM

4,600

7,200

11,800

HEAVY

4,700

5,200

9,900

SEVERE

2,300

2,900

5,200

TOTAL

13,600

17,400

31,000

MILITARY (U.S. & Foreign)

600

700

1,300

EXPANSIONARY

5,300

7,500

12,800

WORLD WIDE TRUCK

19,500

25,600

45,100

2 Quarter 2011 Earnings Call

June 7, 2011

NYSE: NAV

World Wide Engine Shipments

Navistar

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

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

Navistar

Full Year

OEM sales - South America

27,200

37,100

64,300

Ford sales - U.S. and Canada

Other OEM sales

4,500

4,400

8,900

Intercompany sales

17,300

23,500

40,800

Total Shipments

49,000

65,000

114,000

2011

2010

2009

2 Quarter 2011 Earnings Call

June 7, 2011

NYSE: NAV

Order Receipts –

U.S. & Canada

Percentage

2011

2010

Change

2011

2010

Change

2,000

1,900

100

3,500

6,800

2,300

4,500

196

14,400

9,400

5,000

Class 8 heavy trucks

9,300

6,900

2,400

17,000

13,100

3,900

Class 8 severe service trucks

3,700

2,700

1,000

6,500

6,100

400

21,800

13,800

8,000

41,400

32,100

9,300

13,000

9,600

3,400

23,500

19,200

4,300

Total "Traditional" Markets

Combined Class 8 (Heavy and Severe Service)

"Traditional" Markets

School buses

Class 6 and 7 medium trucks

Six Months Ended

April 30,

Three Months Ended

April 30,

2 Quarter 2011 Earnings Call

June 7, 2011

NYSE: NAV

Supplemental Information -

Truck

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

Analyst Day

2011 Actuals

Analyst Day

2011 Actuals

Analyst Day

Traditional

Expansionary

Towables

Worldwide Truck Chargeouts

2 Quarter 2011 Earnings Call

June 7, 2011

NYSE: NAV

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.

2 Quarter 2011 Earnings Call

June 7, 2011

Excludes the US portion of IC Bus

NYSE: NAV

Frequently Asked Questions

Q1:

What is in your Dealcor debt?

Dealcor debt is comprised of wholesale (floor plan) financing and also retail financing on lease and rental

fleets for company owned dealers.

Q2:

How many Dealcor dealers did you have as of April 30, 2011?

Of our 271 primary NAFTA dealers, we have ownership interest in 9 DealCor dealers as of

April 30, 2011.

We expect to further reduce our number of Dealcor dealers in 2011.

Q3:

How are your dealers doing?

The operational and financial strength of our industry leading dealer network continues to improve in all

areas

the

business,

parallel

with

the

overall

improvement

the

North

American

truck

market.

continue

add

new

dealers

the

distribution

network,

attracted

the

breadth

our

product

lines

and

significant

opportunities in major markets. Considerable investments in facility upgrades and acquisitions have also been

completed in the last several months by aggressive and growth oriented existing dealers; further strengthening

our footprint, service capabilities and accessibility to our customers.

Q4:

What kind of rates do you charge your dealers and customers?

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.

Q5:

How do you fund your wholesale business?

primarily

finance

our

wholesale

portfolio

through

traditional

private

public

securitizations,

and

through our bank facility.

2 Quarter 2011 Earnings Call

June 7, 2011

NYSE: NAV

Frequently Asked Questions

Q6:

How is your NFC portfolio performing?

Repossessions, past due accounts and losses peaked in 2008 and have continued to show

improvement since then.

NFC’s retail portfolio in the U.S. is expected to reduce significantly in size

now

that

Navistar

Capital,

the

new

Capital

retail

program,

financing

retail

customers.

Performance

this

portfolio

improved

considerably

2010

and

the

first

half

2011.

Q7:

What is your total amount of capacity at NFC?

Total availability in our U.S. funding facilities is more than $517M as of April 30, 2011.

Q8: What is included in Financial Services Segment Profit, Corporate and Eliminations?

Financial

Services

Segment

Profit,

Corporate

and

Eliminations,

presented,

consist

the

Finance

Services segment and Corporate and Eliminations as shown in the Segment Reporting footnote of our

annual and quarterly reports (10K & 10Q). The primary drivers of Corporate and Eliminations are

Corporate SG&A, pension and OPEB expense excluding amounts allocated to the segments, annual

incentive, manufacturing interest expense, and the elimination of intercompany sales and profit

between segments.

Q9:

What is the status of the retail financing alliance with GE Capital in the United States?

Navistar

Capital

–

the

alliance

formed

with

Capital

support

the

sale

Navistar

products

–

off to a great start and progressing consistent with expectations.

2 Quarter 2011 Earnings Call

June 7, 2011

NYSE: NAV

Frequently Asked Questions

Q10:

How will the changing DOD budget affect Navistar in FY 2011?

Navistar

continues

pursue

number

U.S.

and

foreign

military

opportunities

and

confident

its

annual $2 billion revenue goal. In addition, the company now has more than 30,000 vehicles in

operation throughout the world. These vehicles will require parts and sustainment support throughout

their lifecycles.

Q11:

How does the latest Ground Combat Vehicle (GCV) program announcement affect Navistar?

Navistar was not originally part of the GCV program and is not currently one of the three bidders

participating in the program.

Q12:

What are your margins for military vehicles?

We do not break margins out specific to our military vehicles. These numbers are reported as part of

our Truck Group financials.

Q13:

What is the current Joint Light Tactical Vehicle (JLTV) program status?

As part of the Technology Development (TD) phase, Navistar and BAE continue to participate in the

second phase of the JLTV program. Proposals for the Engineering and Manufacturing Development

(EMD) stage are expected in late FY2011. Two teams will then be selected to compete in the EMD

phase.

2 Quarter 2011 Earnings Call

June 7, 2011

NYSE: NAV

Frequently Asked Questions

Q14:

How does your Class 8 industry compare to ACT Research?

Q15:

What were the 2010 emissions requirements?

Through the use of credits manufacturers can go to a maximum of 0.50g NOx if they reduced

earlier with advanced technology; manufacturers need to be at 0.20g NOx if they chose not to introduce

advanced technologies to reduce their emissions earlier. For many years Navistar introduced cleaner

emission engines than the EPA required, so we were able to generate some credit before we needed to go to

the 0.20g NOx standard.

2 Quarter 2011 Earnings Call

June 7, 2011

Reconciliation to ACT

2011

ACT*

210,500

CY to FY adjustment

(20,000)

Other misc. specialty vehicles Included in ACT

(8,500)

Total (ACT comparable Class 8 to Navistar)

182,000

Navistar Industry Retail Deliveries Combined Class 8 Trucks**

177,500**

Navistar difference from ACT:

4,500

2.5%

*Source: ACT N.A. Commercial Vehicle Outlook -

May, 2011

**See table on bottom of slide 10

U.S. and Canadian Class 8 Truck Sales

NYSE: NAV

Frequently Asked Questions

Q16:

What is Navistar doing to meet the 0.20g NOx emissions when its credits are depleted?

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

December

2009.

submitted

application

for

the

0.20g

NOx

13L

EGR

engine

the

EPA.

Q17:

What is the current net operating loss total, and why is there still a valuation allowance against

deferred tax assets?

The Company has U.S. federal net operating losses (NOLs) available with an undiscounted cash value

totaling $161 million as of October 31, 2010.

In addition, we have state NOLs valued at $85 million

and

foreign

NOLs

valued

$85

million,

for

total

undiscounted

cash

value

$331

million.

substantial

portion

these

NOL

assets

are

subject

valuation

allowance.

addition

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

demonstrate sufficient earnings (both historically and in the future) to absorb these future

deductions,

the

Company

will

release

its

valuation

allowances.

U.S.

operations

continue

improve,

believe

that

the

Company

may

release

all

portion

its

U.S.

valuation

allowance

the

twelve months.

The release of our U.S. valuation allowance would not directly impact our U.S. cash tax payments,

which are expected to remain low until such time as we have exhausted our NOLs and tax credits.

2 Quarter 2011 Earnings Call

June 7, 2011

NYSE: NAV

Frequently Asked Questions

Q18:

How has recent tax legislation affected Navistar?

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

refund

alternative

minimum

tax

(AMT)

payments.

The

Company

received

its

refund

$29

million

of AMT credits in fiscal year 2011 as a result of this legislation.

The Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 extends

current tax rules in several areas, which if not extended, could

have adversely impacted the

Company’s tax results.

In addition, the Act allows businesses to fully depreciate qualifying property

purchased through the end of 2011 (50% first year depreciation for purchases in 2012), which will

benefit both Navistar and its customers.

Q19:

How will $1.8 billion of deferred tax assets be used to offset future taxable income?

Simply put, deferred tax assets represent the value of future tax deductions attributable to items that

have

already

been

expensed

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

immediately

reduce

taxable

income

the

future.

addition,

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

made

the

future.

these

payments

are

made,

the

Company

will

realize

tax deductions to offset future taxable income.

2 Quarter 2011 Earnings Call

June 7, 2011

NYSE: NAV

Frequently Asked Questions

2 Quarter 2011 Earnings Call

June 7, 2011

Q20:

How does vertical integration of a big bore engine impact warranty?

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.

Q21:

Why is your warranty expense higher year over year?

Our warranty costs have been higher than the respective prior year periods primarily as a result of

increased intercompany volumes due to the use of all MaxxForce

engines in our North America

product offering. In addition, we recognized a $27 million increase in adjustments to pre-existing

warranties primarily related to various authorized field campaigns in our Truck segment and

changes in our estimated warranty costs per unit on 2007 emission standard engines in our

Engine segment. Through the first and second quarters of 2011, we have seen favorable

performance on our 2010 engines compared to previous launches and expected performance.

Q22:

What are your expected 2011 and beyond pension funding requirements?

Current forecasts indicate that we may need to contribute approximately $144 million in 2011.

Future contributions are dependent upon a number of factors, principally the changes in values of

plan assets, changes in interest rates, and the impact of any funding relief currently under

consideration. We currently expect that from 2012 through 2013, the Company will be required to

contribute at least $193 million per year to the plans, depending on asset performance and

discount rates.

NYSE: NAV

Frequently Asked Questions

2 Quarter 2011 Earnings Call

June 7, 2011

Q23:

What is your expected 2011 pension and OPEB GAAP expense?

Assuming no further containment actions and no curtailment events, we anticipate 2011 pension

and OPEB GAAP expense will not exceed 2010 levels.

Q24:

What causes the variance between manufacturing cash interest payments and GAAP

interest expense?

The main variance between cash and GAAP interest results from our manufacturing segment’s

$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). The timing of interest payments also impacts this variance on a quarterly

basis, but not on a fiscal year basis.

NYSE: NAV

Frequently Asked Questions

Q25:

What are the $225 million of Recovery Zone Facility Revenue Bonds (RZFBs) Series 2010

due October 15, 2040 being used for?

We are using the proceeds to invest in our product development strategy and our HQ

consolidation.

Great

products

are

key

pillar

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 the RZFBs will allow us to consolidate many

facilities

into

new

facility

and

make

necessary

renovations

that

facility.

Additionally

will

invest

existing

facility,

which

includes

investments

equipment

and

technology

that

will

help us create and improve our product development process and thus shareholder value.

Q26:

Why did you use Recovery Zone Facility Bond (RZFB) financing?

The RZFBs 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

exposure

new

source

investors

that

wouldn’t

otherwise have access to if not for the RZFB program.

2 Quarter 2011 Earnings Call

June 7, 2011

NYSE: NAV

Frequently Asked Questions

Q27:

What should we assume for capital expenditures in fiscal 2011?

plan

continue

capital

spending

within

the

traditionally

guided

range

$250

$350

million

for

products and development.

There is capital spending related to Engineering Integration not

included in the range that is fully funded through the RZFBs.

Q28:

What are the differences between the accounting vs. economic dilution on your convertible

debt?

Please

see

the

presentation

the

website

(http://ir.navistar.com/dilution.cfm )

entitled

Dilution

overview resulting from the Convertible Notes issued on October 2009.

Q29:

Why are the convertible debt holders now able to convert their notes?

The

indenture

our

convertible

notes

contains

provision

that

allows

the

note

holders

convert

anytime during the following fiscal quarter should the price of Navistar’s common stock close 130%

above

the

conversion

price

for

any

day

period

(consecutive

non-consecutive)

out

the

last

consecutive day trading period of each fiscal quarter. Our fiscal quarter ended on April 30, 2011; the

conversion price of the notes is $50.274 per share of Navistar’s common stock; 130% of the

conversion price equals $65.356 per share of Navistar’s common stock. Since Navistar’s common

stock closed above $65.356 per share for more than 20 trading days during the 30 consecutive

trading day period ending on April 30, 2011, the note holders now have the right to convert their

notes any time from May 2, 2011 through July 31, 2011.

2 Quarter 2011 Earnings Call

June 7, 2011

NYSE: NAV

Frequently Asked Questions

We do not expect any note holders to convert as it would be uneconomical to convert because by

converting, the note holders would sacrifice all future coupon payments and forego the intrinsic value of

the

embedded

call

option

contained

the

convertible

notes.

note

holder

chooses

convert,

Navistar has the right to satisfy the conversion through 3 different methods: cash settlement, share

settlement or combination settlement. A combination settlement allows Navistar to settle the principal

amount in cash and the remaining value to be settled in shares (plus cash in lieu of fractional shares).

However, if the note holder chooses to convert and Navistar chooses to settle via a combination

settlement,

then

there

trading

day

observation

period

determine

the

value

settled

shares, so the note holder will not receive the cash and shares for almost two months after the

conversion notice is received. If Navistar’s common stock does not close above $65.356 per share for

any 20 day trading period (consecutive or non-consecutive) during the 30 day consecutive trading day

period for any future fiscal quarter end, then the note holders would no longer have the right to convert

their notes in the subsequent quarter unless this threshold is triggered once again in the future.

Q30:

Why

have

the

convertible

notes

that

are

due

October

2014

been

reclassified

from

long-term

debt to current debt?

mentioned

the

question

above,

the

convertible

note

holders

now

have

the

right

convert

their

notes

through

July

31,

2011.

Under

GAAP,

since

note

holders

have

the

right

convert,

the

debt

must

be classified as a current liability. Since we do not expect any note holders to convert, this is not

expected to have any cash impact to Navistar. If the notes are no longer convertible after July 31, 2011,

then the notes will be reclassified from current to long-term debt.

2 Quarter 2011 Earnings Call

June 7, 2011

NYSE: NAV

($ in millions)

Note: Manufacturing cash flow is a non-GAAP presentation. See

SEC

Reg

–

non-GAAP

reconciliation.

Manufacturing Cash Flow

2 Quarter 2011 Earnings Call

June 7, 2011

Beginning

Mfg.

Cash

Balance

Fiscal 2009

Fiscal 2010

Q1 -

2011

Q2 2011

October 31, 2008

$777

October 31, 2009

$1,152

October 31, 2010

$1,100

January 31, 2011

$762

Approximate Cash Flows:

From Operations

534

409

(214)

386

Dividends from NFC

From Investing / (Cap Ex)

(284)

(350)

(113)

(83)

From Financing / (Debt Pay Down)

(110)

(13)

Exchange Rate Effect

(1)

Net Cash Flow

$295

($52)

($338)

$317

Blue Diamond Consolidation

$80

Ending

Mfg.

Cash

Balance

Fiscal 2009

YTD -

FY 2010

Q1 -

2011

Q2 2011

October 31, 2009

$1,152

October 31, 2010

$1,100

January 31, 2011

$762

April 30, 2011

$1,079

Cash = Cash, Cash Equivalents & Marketable Securities

Includes cash from the consolidation of minority interests

NYSE: NAV

Outstanding Debt Balances

April 31,

October 31,

(in millions)

2011

2010

Manufacturing operations

8.25% Senior Notes, due 2021, net of unamortized discount of $34 and

$35 million at respective dates

966

965

3.0% Senior Subordinated Convertible Notes, due 2014, net of

unamortized discount of $84 and $94 million at the respective dates

486

476

Debt of majority-owned dealerships

Financing arrangements and capital lease obligations

166

221

Loan Agreement related to 6.5% Tax Exempt Bonds, due 2040

225

Other

Total manufacturing operations debt

1,969

1,986

Less: Current portion

(619)

(145)

Net long-term manufacturing operations debt

1,350

1,841

Financial services operations

Asset-backed debt issued by consolidated SPEs, at variable rates, due

serially through 2018

1,769

1,731

Bank revolvers, at fixed and variable rates, due dates from 2012 through

2018

942

974

Commercial paper, at variable rates, due serially through 2012

Borrowings secured by operating and finance leases, at various rates,

due serially through 2017

112

Total financial services operations debt

2,854

2,884

Less: Current portion

(751)

(487)

Net long-term financial services operations debt

2,103

2,397

2 Quarter 2011 Earnings Call

June 7, 2011

NYSE: NAV

SEC Regulation G Non-GAAP

Reconciliation

Manufacturing

Segment

Results:

believe

manufacturing

segment

results,

which

includes

the

segment

results

our

Truck, Engine, and Parts reporting segments, provide meaningful information of our core manufacturing business 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 below reconciliation, and to provide an

additional measure of performance.

Adjusted Net Income and Diluted Earnings Per Share Attributable To Navistar International Corporation and

Adjusted

Manufacturing

Segment

Profit:

believe

that

adjusted

net

income,

diluted

earnings

per

attributable

Navistar International Corporation, and adjusted manufacturing segment profit excluding engineering integration costs,

certain restructuring costs, and certain impairment charges, which are not considered to be part of our ongoing business,

improve the comparability of year to year results and are representative of our underlying performance. 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 below reconciliations, and to provide an additional

measure of performance.

2 Quarter 2011 Earnings Call

June 7, 2011

The financial measures presented below are unaudited and not in accordance with, or an alternative

for, financial measures presented in accordance with 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.

NYSE: NAV

SEC Regulation G Non-GAAP

Reconciliation

Adjusted Manufacturing Earnings Before Interest, Income Taxes, Depreciation, and Amortization (“EBITDA”):

Adjusted manufacturing segment EBITDA is defined as our consolidated net income (loss) from continuing operations minus

the net income (loss) from our financial services operations plus interest expense, income taxes, and depreciation and

amortization. EBITDA is a measure commonly used and is presented

to aid in developing an understanding of the ability of

our operations to generate cash for debt service and taxes, as well as cash for investments in working capital, capital

expenditures, and other liquidity needs. This information is presented as a supplement to the other data provided because it

provides information which we believe is useful to investors for

additional analysis. EBITDA should not be considered in

isolation or as a substitute for net income, cash flows from operating activities or other consolidated operations, or cash flow

statement data prepared in accordance with GAAP, or as a measure

of our profitability or liquidity as determined in

accordance with GAAP.

Manufacturing

Cash

Flow

and

Manufacturing

Cash,

Cash

Equivalents,

and

Marketable

Securities:

Manufacturing

cash flow is used and is presented to aid in developing an understanding of the ability of our operations to generate cash for

debt service and taxes, as well as cash for investments in working capital, capital expenditures and other liquidity needs.

This information is presented as a supplement to the other data provided because it provides information which we believe is

useful to investors for additional analysis. Our manufacturing cash flow is prepared with manufacturing marketable securities

being treated as a cash equivalent. Manufacturing cash, cash equivalents, and marketable securities represents the

Company’s consolidated cash, cash equivalents, and marketable securities

excluding cash, cash equivalents, and

marketable securities of our financial services operations. We include marketable securities with our cash and cash

equivalents when assessing our liquidity position as our investments are highly liquid in nature. 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

below reconciliation, and to provide an additional measure of performance.

2 Quarter 2011 Earnings Call

June 7, 2011

NYSE: NAV

SEC Regulation G –

EPS vs. Traditional Industry

Original

Target

Revised

Target

U.S. & Canada Industry

414,500

350,000

Sales and Revenues, Net

(A)

$15 +

$20 +

Diluted earnings per share attributable to Navistar International Corporation

$ 11.46

$ 12.31

Approximate diluted weighted shares outstanding

~ 72.5

(Dollars in Millions)

Net income (loss) attributable to Navistar International Corporation

$ 825

$ 892

Less: Financial services segment profit, Corporate and eliminations, and income taxes

(775)

(888)

Manufacturing segment profit

$ 1,600

$ 1,780

2 Quarter 2011 Earnings Call

June 7, 2011

(A) Revised Target sales and revenues, net – Projections based on $17-18B of GAAP revenue and $2-3B of Non-GAAP revenue related to Navistar's share of non-consolidated affiliates.

NYSE: NAV

SEC Regulation G

2 Quarter 2011 Earnings Call

June 7, 2011

Three Months Ended April 30, 2011

($ millions)

Net income (loss) attributable to NIC

$74

Add back income taxes

Income before income taxes

$79

Less equity income from financial service operations

($40)

Income before income taxes and equity income from financial service operations

$39

Add back manufacturing interest expense

$38

Manufacturing EBIT

$77

Add

back

manufacturing

depreciation

and

amortization

$74

Adjusted manufacturing EBITDA

$151

Includes

depreciation

equipment

leased

others

and

excludes

debt

issuance

cost/discount

amortization

Navistar International Corporation (Manufacturing operations

with financial services operations on a pre-tax equity basis)

NYSE: NAV

SEC Regulation G –

2011 Guidance

2 Quarter 2011 Earnings Call

June 7, 2011

(A) Engineering integration costs relate to the consolidation of our truck and engine engineering operations as well as the move of our world headquarters. We continue to develop plans for efficient transitions related

to these activities and the optimization of our operations and management structure. We expect to incur approximately $77 million of engineering integration costs in fiscal 2011 with approximately $67 million of the

costs to be recognized by our manufacturing segment and approximately $10 million of corporate charges.

(B) Approximate diluted weighted shares outstanding based on assumed average share price of $65 per share during the period.

Lower

Upper

(Dollars in Millions, except per share data)

Net income attributable to Navistar International Corporation

350

388

Adjusted net income attributable to Navistar International Corporation

427

465

Less: Income taxes

(48)

(55)

Adjusted Profit Excluding Tax

475

520

Diluted earnings per share attributable to Navistar International Corporation

4.50

5.00

1.00

Adjusted diluted earnings per share attributable to Navistar International Corporation

5.50

6.00

77.6

Lower

Upper

(Dollars in Millions)

Net income (loss) attributable to Navistar International Corporation

350

388

Less: Financial services segment profit, Corporate and eliminations, and income taxes

(578)

(615)

Manufacturing segment profit

928

1,003

Adjusted manufacturing segment profit

995

1,070

Fiscal 2011 guidance: adjusted net income and diluted earnings per share attributable to Navistar International Corporation

reconciliation:

Fiscal 2011 guidance: manufacturing segment profit and adjusted manufacturing segment profit reconciliation:

Plus: Engineering integration costs

Approximate diluted weighted shares outstandin

Plus: Engineering integration costs

(A)

(B)

Effect of adjustments on diluted earnings per share attributable to Navistar International Corporation

NYSE: NAV

SEC Regulation G –

Fiscal Year Comparison

2009

2008

(Dollars in Millions, except per share data)

Net income (loss) attributable to Navistar International Corporation

$ 320

$ 134

Plus:

Ford settlement, restructuring and related charges (benefits)

(A)

(157)

Impairment of property, plant, and equipment

(B)

358

Write-off of debt issuance costs

(C)

Adjusted net income attributable to Navistar International Corporation

$ 205

$ 528

Adjusted diluted earnings per share attributable to Navistar International Corporation

$ 2.86

$ 7.21

Diluted weighted shares outstanding

71.8

73.2

2010

2009

2008

(Dollars in Millions, except per share data)

Net income attributable to Navistar International Corporation

$ 223

$ 320

$ 134

Less: Income taxes

(23)

(37)

(57)

Profit Excluding Tax

$ 246

$ 357

$ 191

Less:

Financial services segment profit (loss)

(24)

Corporate and eliminations

(590)

(519)

(478)

Manufacturing segment profit

741

836

693

Plus:

Ford settlement, restructuring and related charges (benefits)

(A)

(160)

Impairment of property, plant, and equipment

(B)

358

Adjusted manufacturing segment profit

$ 741

$ 707

$ 1,088

Adjusted net income and diluted earnings per share attributable to Navistar International Corporation reconciliation:

Manufacturing segment profit and adjusted manufacturing segment profit reconciliation:

2 Quarter 2011 Earnings Call

June 7, 2011

(A)

Ford settlement, restructuring and related charges (benefits) include the impact of our settlement with Ford in 2009 as well as charges and benefits recognized related to

restructuring activity at our Indianapolis Casting Corporation and Indianapolis Engine Plant. The charges and benefits were recognized in our Engine segment with the

exception of $3 million of income tax expense and $1 million of income tax benefit related to the settlement in 2009 and 2008 respectively.

(B)

Impairment of property, plant, and equipment in 2008 are related to impairments to the asset groups in the Engine segment’s VEE Business Unit. The 2009 impairments

relate to charges recognized by the Truck segment for impairments related to asset groups at our Chatham and Conway facilities

(C)

The write-off of debt issuance costs in 2009 relate to charges related to the Company’s refinancing.

NYSE: NAV

SEC Regulation G –

Manufacturing Cash Fiscal Year Comparison

2 Quarter 2011 Earnings Call

June 7, 2011

Manufacturing cash, cash equivalents, and marketable securities reconciliation:

(Dollars in Millions)

April 30, 2011

October 31,

2010

October 31,

2009

October 31,

2008

Manufacturing segment cash and cash equivalents

361

534

1,152

775

Financial services segment cash and cash equivalents

Consolidated cash and cash equivalents

390

585

1,212

861

Manufacturing marketable securities

(A)

Financial services segment marketable securities

718

566

Consolidated marketale securities

738

586

Manufacturing segment cash and cash equivalents

361

534

1,152

775

Manfuacturing marketable securities

718

566

Manufacturing segment cash, cash equivalents and marketable securities

1,079

1,100

1,152

777

(A)

Manufacturing

marketable

securities

October

31,

2008

million

were

included

Other

current

assets

for

financial

reporting.

NYSE: NAV

SEC Regulation G –

Manufacturing Cash

2 Quarter 2011 Earnings Call

June 7, 2011

Manufacturing

Operations

Financial

Services

Operations

Adjustments

Condensed

Consolidated

Cash Flows

(Dollars in Millions)

For the year ended October 31, 2009

Cash flows from operations

534

704

1,238

Cash flows from investing / capital expenditures

(284)

(212)

Cash flows from financing / debt pay down

(780)

(20)

(764)

Effect of exchange rate changes

Net cash flows

295

(26)

271

Blue Diamond Consolidation

Beginning cash, cash equivalents and marketable securities balance

777

(2)

861

Ending cash, cash equivalents and marketable securities balance

1,152

1,212

Manufacturing

Operations

Financial

Services

Operations

Adjustments

Condensed

Consolidated

Cash Flows

(Dollars in Millions)

For the year ended October 31, 2010

Cash flows from operations

409

698

1,107

Cash flows from investing / capital expenditures

(350)

492

(576)

(434)

Cash flows from financing / debt pay down

(110)

(1,180)

(10)

(1,300)

Effect of exchange rate changes

(1)

Net cash flows

(52)

(586)

(627)

Blue Diamond Consolidation

Beginning cash, cash equivalents and marketable securities balance

1,152

1,212

Ending cash, cash equivalents and marketable securities balance

1,100

(586)

585

Manufacturing segment cash flow reconciliation:

NYSE: NAV

SEC Regulation G –

Manufacturing Cash

2 Quarter 2011 Earnings Call

June 7, 2011

Manufacturing

Operations

Financial

Services

Operations

Adjustments

Condensed

Consolidated

Cash Flows

(Dollars in Millions)

For the six months ended April 30, 2011

Cash flows from operations

$ 172

$ 54

$ -

$ 226

Cash flows from investing / capital expenditures

(196)

(26)

(152)

(374)

Cash flows from financing / debt pay down

(5)

(53)

(58)

Effect of exchange rate changes

Net cash flows

$ (21)

$ (22)

$ (152)

$ (195)

Blue Diamond Consolidation

Beginning cash, cash equivalents and marketable securities

balance

1,100

(586)

585

Ending cash, cash equivalents and marketable securities balance

$ 1,079

$ 49

$ (738)

$ 390

Manufacturing

Operations

Financial

Services

Operations

Adjustments

Condensed

Consolidated

Cash Flows

(Dollars in Millions)

For the three months ended April 30, 2011

Cash flows from operations

$ 386

$ (165)

$ -

$ 221

Cash flows from investing / capital expenditures:

(83)

(26)

(328)

(437)

Cash flows from financing / debt pay down

191

199

Effect of exchange rate changes

Net cash flows

$ 317

$ 2

$ (328)

$ (9)

Blue Diamond Consolidation

Beginning cash, cash equivalents and marketable securities

balance

762

(410)

399

Ending cash, cash equivalents and marketable securities balance

$ 1,079

$ 49

$ (738)

$ 390

Manufacturing segment cash flow reconciliation:

NYSE: NAV

SEC Regulation G –

Three and six months ended April 30, 2011 and 2010

(A)

Engineering integration costs relate to the

consolidation of our truck and engine engineering

operations as well as the move of our world

headquarters. Engineering integration costs include

restructuring charges for activities at our Fort Wayne

facility of $1 million and $19 million for the three and

six months ended April 30, 2011, respectively. The

restructuring charges recorded are based on

restructuring plans that have been committed to by

management and are, in part, based upon

management's best estimates of future events.

Changes to the estimates may require future

adjustments to the restructuring liabilities. We also

incurred an additional $5 million and $7 million of

other related costs for the three and six months

ended April 30, 2011, respectively. Operations

included in our manufacturing segment recognized $3

million and $21 million of the engineering integration

costs for the three and six months ended April 30,

2011, respectively. We continue to develop plans for

efficient transitions related to these activities and the

optimization of our operations and management

structure. For fiscal 2011, we expect to incur

approximately $50 million of additional charges

related to these activities.

(B)

Ford restructuring and related charges (benefits) are

charges and benefits recognized in 2010 related to

restructuring activity at our Indianapolis Casting

Corporation and Indianapolis Engine Plant. In the

first quarter of 2010, the Company recognized $17

million of restructuring benefits related to restructuring

activity at these locations. The restructuring benefit

primarily related to the settlement of a portion of our

other contractual costs for $16 million within the

restructuring liability. The charges were included in

Restructuring

charges

our

Engine

segment.

2 Quarter 2011 Earnings Call

June 7, 2011

2011

2010

2011

2010

(Dollars in Millions, except per share data)

Net income (loss) attributable to Navistar International Corporation

$ 74

$ 43

$ 68

$ 62

Plus:

Engineering integration costs

(A)

Ford restructuring and related charges (benefits)

(B)

(17)

Adjusted net income attributable to Navistar International Corporation

$ 80

$ 43

$ 94

$ 45

Diluted earnings (loss) per share attributable to Navistar International Corporation

$ 0.93

$ 0.60

$ 0.87

$ 0.86

Effect

adjustments

diluted

earnings

per

attributable

Navistar

International

Corporation

0.09

0.35

(0.24)

Adjusted diluted earnings per share attributable to Navistar International Corporation

$ 1.02

$ 0.60

$ 1.22

$ 0.62

Diluted weighted shares outstanding

78.6

72.8

77.3

72.4

2011

2010

2011

2010

(Dollars in Millions)

Net income (loss) attributable to Navistar International Corporation

$ 74

$ 43

$ 68

$ 62

Less:

Financial services segment profit

$ 40

$ 16

$ 72

$ 28

Corporate and eliminations

(129)

(132)

(247)

(285)

Income taxes

(5)

Manufacturing segment profit

168

149

248

317

Plus:

Engineering integration costs

(A)

Ford restructuring and related charges (benefits)

(B)

(17)

Adjusted manufacturing segment profit

$ 171

$ 149

$ 269

$ 300

Adjusted net income and diluted earnings per share attributable to Navistar International

Three Months Ended

April 30,

Six Months Ended

April 30,

Manufacturing segment profit and adjusted manufacturing segment profit reconciliation:

Three Months Ended

April 30,

Six Months Ended

April 30,

Corporation reconciliation:

NYSE: NAV

SEC Regulation G –

Q1 2011 vs. Q1 2010 Comparison

(A)

Engineering integration costs relate to the consolidation of our

truck and

engine engineering operations as well as the move of our world

headquarters. Engineering integration costs include restructuring charges

for activities at our Fort Wayne facility of $18 million for the

three months

ended January 31, 2011. The restructuring charges recorded are based on

restructuring plans that have been committed to by management and are,

in part, based upon management's best estimates of future events.

Changes to the estimates may require future adjustments to the

restructuring liabilities. We also incurred an additional $2 million of other

related costs for the three months ended January 31, 2011. Operations

included in our manufacturing segment recognized $18 million of the

engineering integration costs for the three months ended January

31,

2011. We continue to develop plans for efficient transitions related to these

activities and the optimization of our operations and management

structure. For fiscal 2011, we expect to incur approximately $50

million of

additional charges related to these activities.

(B)

Ford restructuring and related charges (benefits) are charges and benefits

recognized in 2010 related to restructuring activity at our Indianapolis

Casting Corporation and Indianapolis Engine Plant. In the first

quarter of

2010, the Company recognized $17 million of restructuring benefits related

to restructuring activity at these locations. The restructuring benefit

primarily related to the settlement of a portion of our other contractual

costs for $16 million within the restructuring liability. The charges were

included in Restructuring charges

in our Engine segment.

2 Quarter 2011 Earnings Call

June 7, 2011

2011

2010

(Dollars in Millions, except per share data)

Net income (loss) attributable to Navistar International Corporation

$ (6)

$ 19

Plus:

Engineering

integration

costs

(A)

Ford

restructuring

and

charges

(benefits)

(B)

(17)

Adjusted net income attributable to Navistar International Corporation

$ 14

$ 2

Diluted earnings (loss) per share attributable to Navistar International Corporation

$ (0.08)

$ 0.26

Effect

adjustments

diluted

earnings

per

attributable

Navistar

International

Corporation

0.27

(0.23)

Adjusted diluted earnings per share attributable to Navistar International Corporation

$ 0.18

$ 0.03

Diluted

weighted

outstanding

(C)

75.9

72.1

2011

2010

(Dollars in Millions)

Net income (loss) attributable to Navistar International Corporation

$ (6)

$ 19

Less:

Financial services segment profit

$ 32

$ 12

Corporate and eliminations

(118)

(153)

Income taxes

(8)

Manufacturing segment profit

168

Plus:

Engineering

integration

costs

(A)

Ford

restructuring

and

charges

(benefits)

(B)

(17)

Adjusted manufacturing segment profit

$ 98

$ 151

Adjusted net income and diluted earnings per share attributable to Navistar International

Three Months Ended

January 31,

Manufacturing segment profit and adjusted manufacturing segment profit reconciliation:

Three Months Ended

January 31,

Corporation reconciliation:

Navistar International (NAV) 8-KNavistar Reports Improved 2Q Adjusted Net Income; Narrows