 NYSE: NAV 1 Analyst Day February 1, 2012 Navistar Analyst Day February 1, 2012 Exhibit 99.1 |
 NYSE: NAV 2 Analyst Day February 1, 2012 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, 2011, which was filed on December 20, 2011, 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 Analyst Day February 1, 2012 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 items that may not be related to the core manufacturing business or underlying results. Measures may also be adjusted to exclude certain adjustments which are not considered to be part of our ongoing business and are not representative of our underlying performance. Management often uses this information to assess and measure the underlying 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. The Non-GAAP numbers are reconciled to the most appropriate GAAP number is in the appendix of this presentation. |
 NYSE: NAV 4 Analyst Day February 1, 2012 4 Dan Ustian Chairman, President and Chief Executive Officer |
 NYSE: NAV 5 Analyst Day February 1, 2012 5 Agenda • Jack Allen, President, N.A. Truck Group • Archie Massicotte, President, Navistar Defense • Eric Tech, President, Engine Group • Troy Clarke, President, Asia Pacific and Strategic Initiatives • A.J. Cederoth, EVP & CFO • Q&A • Product and Technology Tour DIFFERENTIATION & INTEGRATION & CONTROLLING DESTINY LEVERAGING ASSETS |
 NYSE: NAV 6 Analyst Day February 1, 2012 6 Building and Shaping Navistar’s History 1909 1912 1918 1924 1936 1942 1943 1950s Cyrus H. McCormick |
 NYSE: NAV 7 Analyst Day February 1, 2012 7 • Focus is on reducing impact of cyclicality – Non-traditional/expansion markets – Grow parts • Improve cost structure while developing synergistic niche businesses with richer margins • Improve conversion rate of operating income into net income • Controlling our Destiny 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. DIFFERENTIATION & INTEGRATION LEVERAGING ASSETS & CONTROLLING DESTINY |
 NYSE: NAV 8 Analyst Day February 1, 2012 8 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. $(10.00) $(5.00) - $5.00 $10.00 $15.00 $20.00 $25.00 $ - 50,000 100,000 150,000 200,000 250,000 300,000 350,000 400,000 450,000 500,000 Adjusted Manufacturing Segment Profit (Loss) ($500) $0 $500 $1,000 $1,500 $2,000 2003 2004 2005 2006 $20B Goal Fiscal Year 150 200 250 300 350 400 450 TRADITIONAL INDUSTRY VOLUME (000S ) Goal at Mature strategy & 350k |
 NYSE: NAV 9 Analyst Day February 1, 2012 9 Leveraging by Integration and Differentiation Great Products Great Products AAP TBP GAP EAP SAP HEP Air System Transition from Focused to Flexible Manufacturing In-cylinder EGR Fuel System Controls Blocks Dealer strength Growth through integrated products Mixers Military RV Profitable Growth Competitive Cost Structure |
 NYSE: NAV 10 Analyst Day February 1, 2012 10 Results While Building The Foundation For Our Future Through Integration |
 NYSE: NAV 11 Analyst Day February 1, 2012 11 Profitable at all points in the cycle Results While Building Note: This slide contains non-GAAP information; please see the Reg G in appendix for a detailed reconciliation. 2007, 2008, 2009 and 2011 excluded certain charges. ($200) $0 $200 $600 $1,200 $1,000 $800 $400 2003 2004 2005 2006 2007 2008 2009 2010 2011 50,000 100,000 150,000 200,000 250,000 300,000 350,000 400,000 450,000 500,000 $(10.00) $(5.00) $ $5.00 $10.00 $15.00 $20.00 $25.00 - 150 200 250 300 350 400 450 Fiscal Year TRADITIONAL INDUSTRY VOLUME (000S ) - |
 Purchased Engines Global Powertrain Leader in Integrated Products, Technology and Innovation 12 Analyst Day February 1, 2012 NYSE: NAV DT 9 10 7 2012 Product Offerings – Well Positioned For the Future 2007 Product Offerings |
 NYSE: NAV 13 Analyst Day February 1, 2012 13 Positioned Well for the Future FY 2012 Military ~$1.5B N. A. Truck Engines Parts Global Building the foundation for our future through integration |
 NYSE: NAV 14 Analyst Day February 1, 2012 14 Continued Success in 2012 While Building Our Future Note: This slide contains non-GAAP information; please see the Reg G disclosure in the appendix for a detailed reconciliation. 2007, 2008, 2009 and 2011 excluded certain charges. 2012 FY Guidance and Pro-Forma does not include engineering integration costs and restructuring of N.A. manufacturing operations. ($93) $11 $421 $838 $462 $1,088 $707 $741 $882 $1,075 $1,800 - 50,000 100,000 150,000 200,000 250,000 300,000 350,000 400,000 450,000 500,000 -$500 $0 $500 $1,000 $1,500 $2,000 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Guidance Midpoint At 350k Fiscal Year Manufacturing Segment Profit (Loss)* 2007 Actual 2008 Actual 2009 Actual 2010 Actual 2011 Actual $(5.00) $- $5.00 $10.00 $15.00 $20.00 $25.00 150 200 250 300 350 400 TRADITIONAL INDUSTRY VOLUME (000S ) 2012 Guidance 2012 Pro -Forma Goal at Mature Strategy & 350K |
 NYSE: NAV 15 Analyst Day February 1, 2012 15 Status of Integration/Differentiation • Bus • Military • Latin America • Parts Actions Complete Breakthroughs 2012 Future • North America Truck • Engine • Global Truck • Global Bus 40T/49T 25T Tipper CT610 CT630 ProStar ® with MaxxForce ® 15 Sloped Nose WorkStar ® MaxxForce ® 11/13 LoneStar ® with 500HP MaxxForce ® 13 13L 13L |
 NYSE: NAV 16 Analyst Day February 1, 2012 16 Jack Allen President, North America Truck Group |
 NYSE: NAV 17 Analyst Day February 1, 2012 17 North America Truck Industry • Economy – Choppy recovery – Consumer confidence lacking – Unemployment remains high – Freight levels/rates/profitability • Industry Shifts – Intermodal – Length of haul – 13L Big Bore engines Era of Dynamic Change Navistar Strategy Anticipates and Capitalizes on Market Dynamics through Integration • Regulatory – Emissions – GHG – OBD – Stopping distance • Customers – Consolidation – Regulations – HOS, EOBR – Driver shortages – Replacement purchases – used truck values |
 NYSE: NAV 18 Analyst Day February 1, 2012 18 North American Truck Strategy • Great Products Differentiated through Integration • Costs Scale/Labor/Manufacturing • Growth Market Share, New Markets, New Business 10% Return on Sales LEVERAGING ASSETS & CONTROLLING DESTINY DIFFERENTIATION & INTEGRATION |
 NYSE: NAV 19 Analyst Day February 1, 2012 19 Integrated Strategic Picture Product Customer New Products New Markets Distribution Customer Support Integrated Trucks |
 NYSE: NAV 20 Analyst Day February 1, 2012 20 Strong Actions During Recession Lead to Success in Core North America Market Recovery U.S. and Canada Traditional Industry Products, Distribution, Growth Solid Recovery from 2009 Trough Industry up 45% from 2009 trough Industry up 45% from 2009 trough |
 NYSE: NAV 21 Analyst Day February 1, 2012 21 Broadest Integrated Application Based Product Line Heavy Medium Class 8 Bus Severe Market Leadership: Note: Market share based on brand |
 NYSE: NAV 22 Analyst Day February 1, 2012 22 Integrated Strategic Picture New Products New Markets Distribution Product Integrated Trucks Customer Support Customer |
 NYSE: NAV 23 Analyst Day February 1, 2012 23 Core Product Strategy Industry 15L to 13L Conversion |
 NYSE: NAV 24 Analyst Day February 1, 2012 Products – New and Differentiated MaxxForce ® Engines Family NOx Emissions Working with the EPA Submitted a 0.2g NOx in-cylinder Big Bore engine for production certification Continue building with credits and other EPA alternatives if required In-cylinder Emission Solution Only Industry OEM that retains emission compliance burden Customer friendly, simple operating experience Only Manufacturer in the world who will have achieved 0.2 NOX without SCR 1.2 0.5 0.2 |
 NYSE: NAV 25 Analyst Day February 1, 2012 25 Core Product Strategy – Integrated and Enhanced LoneStar ® with 500HP MaxxForce ® 13 Sloped Nose WorkStar ® with upgraded interior MaxxForce ® 15 PayStar ® with MaxxForce ® 15 up to 550HP New Low Cab Forward product Advanced EGR technology Natural Gas offering MaxxForce ® 10 MaxxForce ® 11 |
 NYSE: NAV 26 Analyst Day February 1, 2012 26 Integrated Strategic Picture New Products New Markets Distribution Product Integrated Trucks Customer Support Customer |
 NYSE: NAV 27 Analyst Day February 1, 2012 27 Products – New and Differentiated 60,000 Unit Class 4/5 Market – 20% Share Goal Commercial Alternative to Pick-up Truck EGR Based MaxxForce ® 7 Engine 3,000 in 2011; 12,000 Mature 4x4 in 2012 Body Installation at Navistar Plant |
 NYSE: NAV 28 Analyst Day February 1, 2012 28 Natural Gas is a Growth Opportunity Natural Gas Demand Integrated product Strong partners Full product line Best distribution network and customer support Why Navistar? Diesel and Natural Gas (DGE) Pricing Natural Gas is 50% less than Diesel New Innovations in Hydraulic Fracturing Technology have resulted in expansion of the Natural Gas Industry 100-200 years of Natural Gas Diesel LNG CNG $4 $2 2011 2016 ~600 11,000+ |
 NYSE: NAV 29 Analyst Day February 1, 2012 29 Integrated Strategic Picture New Products New Markets Distribution Product Integrated Trucks Customer Support Customer |
 NYSE: NAV 30 Analyst Day February 1, 2012 30 North America Distribution New International Dealers Distribution Network • Investments to strengthen the best dealer network in the industry • New and existing dealers in key major market areas • Solid experience from proven leaders in truck and related industries… Freightliner, Volvo, Mack, Caterpillar, Peterbilt, Sterling • Investment in integrated strategy: facilities, technicians, hours of service, diesel particulate filter machines, etc. Full product line Integrated products Parts and service Keeping our dealers strong and growing |
 NYSE: NAV 31 Analyst Day February 1, 2012 31 Integrated Strategic Picture New Products New Markets Distribution Product Integrated Trucks Customer Support Customer |
 NYSE: NAV 32 Analyst Day February 1, 2012 32 Integrated Parts, Service and Customer Support Built around the Customer Significantly Improving Vehicle Uptime Repair advocates Diagnostic/Repair Parts identification Parts sourcing Warranty On the move: Alerts Assessment/Diagnostic Repair facility identification Repair parts location & shipping Direct asset to en-route repair facility Fast turnaround/expedited service Auto Data Populate Consolidated Team at Lisle World Headquarters Smart Truck |
 NYSE: NAV 33 Analyst Day February 1, 2012 33 Parts Business Parts Business Positioned for Steady Consistent Growth Proprietary Engine Population Growth North American Commercial Parts Sales Mid Range Established Big Bore Growth Engine business drives ancillary part sales |
 NYSE: NAV 34 Analyst Day February 1, 2012 34 Integrated Strategic Picture New Products New Markets Distribution Product Integrated Trucks Customer Support Customer |
 NYSE: NAV 35 Analyst Day February 1, 2012 35 Growth: Integrated Trucks |
 NYSE: NAV 36 Analyst Day February 1, 2012 36 Integrated Truck Strategy Rear Discharge Front Discharge Body Integration Alabama Assembly Plant |
 NYSE: NAV 37 Analyst Day February 1, 2012 37 Competitive Cost Structure • Lisle and Melrose integration • Fully flexible – 1 – 2 – 3 platforms • Common manufacturing processes • Global Sourcing • Commodity Strategy Manufacturing Flexibility Product Development Strategy JAC JV pending government approval Optimized lowest cost in industry Logistics Inbound/Outbound freight Assembly cost Procurement Common Platforms = Scale – MNAL - India – JAC - China – MWM - South America – Escobedo - Mexico |
 NYSE: NAV 38 Analyst Day February 1, 2012 38 Results and a Look Forward North America Truck Breakeven Volume Improvement 2009 2012 Unit Volume Breakeven Volume 40+% |
 NYSE: NAV 39 Analyst Day February 1, 2012 39 Results Medium Share 36% - 38% 40% Past 2011 Class 8 Share 19% - 25% 21% Past 2011 Class 6 – 8 Industry Aftermarket Part Sales Navistar Class 6 – 8 Sales $10+B |
 NYSE: NAV 40 Analyst Day February 1, 2012 40 Positioned for Profit and Growth “Best Integrated Vehicle Solutions for Our Customers” Industry recovery Increasing volumes Market Leader #1/#2 in all segments Investing in distribution Continuing to invest in new products and adjacet niche markets Proprietary engines growing parts sales Improving margins and lowering breakeven volumes Note: Market share based on brand |
 NYSE: NAV 41 Analyst Day February 1, 2012 41 Archie Massicotte President, Navistar Defense |
 NYSE: NAV 42 Analyst Day February 1, 2012 42 Serving Our Military Then Now |
 NYSE: NAV 43 Analyst Day February 1, 2012 43 Leverage & Integrate Our Assets Profitable Growth Through Integration Navistar Defense • Body integrator • Full service logistics • Parts LEVERAGING ASSETS & CONTROLLING DESTINY DIFFERENTIATION & INTEGRATION |
 NYSE: NAV 44 Analyst Day February 1, 2012 44 Navistar Defense – Era of Efficiency 2008 2009 2010 2011 2012 + > $2B > $2B > $2B ~$2B $1.5+ Positioned well for dealing with budget constraints Commercial platforms and services for any program Defense departments desire • High operational readiness • Rapid development • Affordability and cost containment • Low total cost of ownership – Efficient repairs – Efficient maintenance • Promote real competition • Incentivize productivity & innovation |
 NYSE: NAV 45 Analyst Day February 1, 2012 45 Economical Solutions Leveraging Commercial Assets with Integration |
 NYSE: NAV 46 Analyst Day February 1, 2012 46 Economical Solutions Innovation & Integration Within Defense MaxxForce ® D Engines Tatra Suspension System 8 X 8 6 X 6 |
 NYSE: NAV 47 Analyst Day February 1, 2012 47 FSRs Parts distribution Parts distribution Supply Chain Management Economical Solutions for Life – Cycle Integration With Commercial Systems Special tools (EZ techs) Engineering services Fleet/Parts availability contracts Warranty Training Commercial Core Commercial Core Dealerships Parts availability Technicians / field service reps Availability (uptime - readiness) Warranty administration Support tools & equipment Training 3 rd party logistics & supply chain mgmt. |
 NYSE: NAV 48 Analyst Day February 1, 2012 48 System Technical Support Initiatives |
 NYSE: NAV 49 Analyst Day February 1, 2012 49 Recent Wins: $990M MaxxPro Rolling Chassis & DXM Kits Rolling Chassis Award: • 2,717 Rolling Chassis • Engineering changes • Supplies • Services MaxxPro Plus DXM™ ISS Kits: • 650 Kits Opportunity: • Installation in the United States and overseas • Refresh to 10/20 standards ISS – Independent Suspension Solution (ISS) Remove Body From Base Chassis Transfer Body to New Rolling Chassis Fielded MaxxPro Plus DXM ISS upgrade Install Body to New Rolling Chassis |
 NYSE: NAV 50 Analyst Day February 1, 2012 50 Navistar Defense Revenue Mix MSVS SMP - Medium Support Vehicle System (MSVS) Standard Military Pattern (SMP); JLTV – Joint Light Tactical Vehicle (JLTV); FMS – Foreign Military Sales Diversified Military Revenue Capability Insertion Parts U.S. & FMS Vehicles Services Direct Foreign Sales Opportunities MSVS SMP JLTV Light Tactical Vehicle Opportunities Foreign Opportunities Engine Repower 2012 2013 2014 2015+ |
 NYSE: NAV 51 Analyst Day February 1, 2012 51 Anticipating the Need MaxxPro ® Plus 2,247 Units MaxxPro ® Recovery 390 Units MaxxPro ® Dash Ambulance 250 Units Saratoga™ MXT™ 338 Units and Allied opportunities Available for U.S. |
 NYSE: NAV 52 Analyst Day February 1, 2012 52 Joint Light Tactical Vehicle The Jan. 26 update: • $250K average cost per vehicle target • $65K for additional add-on armor kit (called a B kit) • Engineering, Manufacturing and Development phase will now be 27 months • Production award in 2015 • Procurement of at least 20,000 JLTVs Humvee Recap Effort Killed; Army Won't Reap Savings Inside Defense – Jan. 24, 2012 |
 NYSE: NAV 53 Analyst Day February 1, 2012 53 Thanks Affordability $250K B-kit Survivability MRAP-Level Transportability 76” Ready Now |
 NYSE: NAV 54 Analyst Day February 1, 2012 54 Eric Tech President, Engine Group |
 NYSE: NAV 55 Analyst Day February 1, 2012 55 Navistar Engine LEVERAGING ASSETS & CONTROLLING DESTINY DIFFERENTIATION & INTEGRATION Controlling Our Destiny Leading Integration |
 NYSE: NAV 56 Analyst Day February 1, 2012 56 Integration - Navistar Truck 100% MaxxForce Engines Full line of engines & parts thru Class 8 Superior emissions solution Fuel economy & performance advantages Competitive cost structure Advantage Navistar Truck |
 NYSE: NAV 57 Analyst Day February 1, 2012 57 Margin Improvement Stability & scale enables… Material cost reduction Supply chain optimization Manufacturing efficiencies Internalized margins through PPT 2011 2012 Goal Cost per unit reduction 13% 10% Hour per unit reduction 22% 8% MaxxForce ® 13 Results & Goals Reduced Cost Improved Profitability |
 NYSE: NAV 58 Analyst Day February 1, 2012 58 Leverage Across the Business Inline Installed Engine Population 2009 2012 2015 Over 7 Million Today Big Bore Today 50,000 • Large installed base • Drives parts revenue • Growing components share • Expanded engine range • Increasing proprietary parts • Big Bore revenue opportunity 200,000 600,000 1,000,000 PARTS GROUP DEALERS/SERVICE 250,000 2009 2012 2015 |
 NYSE: NAV 59 Analyst Day February 1, 2012 59 North American On-Road OEM Market 30k Industry MaxxForce ® 13 Custom Fire Truck Engine Leverage for North America Growth Proven on-road product portfolio Leading emissions technology Niche high-margin segments Leverage Navistar parts & service 0 3,000 6,000 9,000 Other Cement Mixers Refuse Scrubbers/Sweepers Crane Terminal Tractor Fire & Rescue Transit/Coach RV/Motorhome |
 NYSE: NAV 60 Analyst Day February 1, 2012 60 Leverage for Global Growth Global Emissions Flexibility Regional Supply Base Local Manufacturing Capability Global Service & Parts Network Setting the Foundation for Global Truck Business OEM/Truck Market Joint Ventures |
 NYSE: NAV 61 Analyst Day February 1, 2012 61 Air System Fuel System A/T System Research and Development Design and Material Solutions Metal Castings Machining METALCASTINGS GROUP SYSTEMS GROUP Leverage for Component Growth |
 NYSE: NAV 62 Analyst Day February 1, 2012 62 Navistar Engine Business Progress 2011 2012 Future Transition Stabilize & Achieve Scale Demonstrate Results Leading Commercial Engine Producer Revenue Growth 2010 2011 2012 Future $3.0B $3.7B $4.0 - $4.5B $5.0 - $5.5B (@350K Industry) Note: Engine revenue includes intercompany sales. 2010 |
 NYSE: NAV 63 Analyst Day February 1, 2012 63 Troy Clarke President, Asia Pacific and Strategic Initiatives |
 NYSE: NAV 64 Analyst Day February 1, 2012 64 Navistar’s Global Strategy DIFFERENTIATION & INTEGRATION LEVERAGING ASSETS & CONTROLLING DESTINY 1. INTERNATIONAL ® brand distribution • Markets that matter • Local leadership • Exclusive distribution 2. Leverage what we do well • Customer knowledge / support • Product portfolio • Partners and alliances |
 NYSE: NAV 65 Analyst Day February 1, 2012 65 Goal: Significant Revenue Growth PARTS revenue outside revenue outside North America North America 50% 50% Integrated Growth Engines Trucks |
 NYSE: NAV 66 Analyst Day February 1, 2012 66 2010 Profitable Exports and Investing 2011 Expanded Exports and Continuing Investment 2012 Growth and Profitability 2015 Global Vision Global Timeline |
 2011 Global Accomplishments Restructured NC2 JV Strong LOCAL Leadership China Engine plant groundbreaking Latin America share Record Continental Mixer sales in Latin America China Engine plant groundbreaking Award-winning products in India TranStar ® launch in Latin America Back in business in Brazil 150+ rebuilding Panama Canal NYSE: NAV Analyst Day February 1, 2012 67 |
 NYSE: NAV 68 Analyst Day February 1, 2012 68 Global Revenue Projected to Double 2007 2015 2011 $1.5 B $6-8 B $3 B Parts Engine Truck Parts Engine Truck Parts Engine Truck |
 NYSE: NAV 69 Analyst Day February 1, 2012 69 Integrated Global Strategy: Feet First ENGINE • Build reputation • Service network • Brand association • Supply base • Parts support network • 85% key ratings available TRUCK • Develop truck distribution • Leverage truck brands • Integrated engines • Increase local team • Manufacturing/assembly • Parts availability in market INTEGRATED GROWTH • Bus applications • Integrated solutions • Exports to other regions • All-makes parts • Alternative fuels |
 NYSE: NAV 70 Analyst Day February 1, 2012 70 STRONG DISTRIBUTION LOCAL LEADERSHIP INTEGRATED GROWTH INTEGRATED PRODUCT Global Playbook: A Proven Blueprint MARKETS THAT MATTER |
 NYSE: NAV 71 Analyst Day February 1, 2012 71 Focus on Growing Markets 2010: 1.9 M 2015: 2.3 – 2.5 M GDP > 7% GDP = 4 – 7% GDP < 4% GDP Industry Volumes Note: Includes Medium and Heavy Trucks >6T - Source: JD Power Q2 2011 * Class 7 & 8 Only (source: compiled country data from Regional Office) |
 NYSE: NAV 72 Analyst Day February 1, 2012 72 LOCAL LEADERSHIP INTEGRATED GROWTH Global Playbook MARKETS THAT MATTER STRONG DISTRIBUTION INTEGRATED PRODUCT |
 NYSE: NAV 73 Analyst Day February 1, 2012 73 Strong Alliances and Leadership LEADERSHIP ALLIANCES AROUND THE GLOBE |
 NYSE: NAV 74 Analyst Day February 1, 2012 74 INTEGRATED PRODUCT Global Playbook MARKETS THAT MATTER STRONG DISTRIBUTION LOCAL LEADERSHIP INTEGRATED GROWTH |
 Differentiate: Integrated Product Portfolio Brazil South Africa Latin America Australia India Brazil Latin America 75 MN Series Cat C610/30 DuraStar ® LoneStar® ProStar® AeroStar™ TranStar ® MN Series 9000s PayStar ® 9800 1-2-3 STRATEGY 1990 2010 2015 2 1 3 WorkStar ® |
 NYSE: NAV 76 Analyst Day February 1, 2012 76 EPA ENGINES EURO ENGINES Differentiate: Integrated Engine Portfolio MaxxForce ® DT466 / 530 MaxxForce ® 7 MaxxForce ® 15 MaxxForce ® 11 MaxxForce ® 9/10 MaxxForce ® 13 MaxxForce ® 3.2 MaxxForce ® 4.8 MaxxForce ® 7.2 |
 NYSE: NAV 77 Analyst Day February 1, 2012 77 MARKETS THAT MATTER STRONG DISTRIBUTION LOCAL LEADERSHIP INTEGRATED GROWTH INTEGRATED PRODUCT Global Playbook |
 NYSE: NAV 78 Analyst Day February 1, 2012 78 Differentiate: Strong Distribution Parts availability Brand exclusive Well financed, multi-location Australia India Training facilities Real time support China* Mobile service *JAC JV pending Customer Support Leverage Partnerships Commitment to the business |
 NYSE: NAV 79 Analyst Day February 1, 2012 79 Global Dealer Footprint Progress LATIN AMERICA 74 BRAZIL 12 80 S. AFRICA 11 40 INDIA 49 100 CHINA 100 180* AUSTRALIA 14 20 Sales locations 2012 2015+ 470 650-700 Total Sales or Service Points *JAC JV pending MENA 13 25 |
 NYSE: NAV 80 Analyst Day February 1, 2012 80 MARKETS THAT MATTER LOCAL LEADERSHIP Global Playbook INTEGRATED PRODUCT STRONG DISTRIBUTION INTEGRATED GROWTH |
 NYSE: NAV 81 Analyst Day February 1, 2012 81 Integrated Growth Opportunities *Neobus JV pending |
 82 NYSE: NAV Analyst Day February 1, 2012 82 Global Playbook: Latin America INTEGRATED PRODUCT 31 YEARS EXPERIENCE IN LATIN AMERICA LOCAL LEADERSHIP INTEGRATED GROWTH STRONG DISTRIBUTION AERO VS. CAB OVER 2010 2011 LATEC fleet training Continental ® mixer Adapted for local market |
 NYSE: NAV 83 Analyst Day February 1, 2012 83 Progress and Results * JV pending Latin America Brazil India China* Local Leadership Product Truck Engine Parts Bus Distribution Results 2007 2000 2013 2013* |
 NYSE: NAV 84 Analyst Day February 1, 2012 84 Accelerating Global Results • Global market – growing • Product strategy – ready to go • Distribution – building 2012 • Growth business – exciting opportunities now • Navistar Global – poised for accelerated results INTEGRATED PRODUCT STRONG DISTRIBUTION LOCAL LEADERSHIP INTEGRATED GROWTH MARKETS THAT MATTER |
 NYSE: NAV 85 Analyst Day February 1, 2012 85 A. J. Cederoth Executive Vice President & Chief Financial Officer |
 NYSE: NAV 86 Analyst Day February 1, 2012 86 Setting a Path for Delivering Results Note: This slide contains non-GAAP information; please see the Reg G disclosure in the appendix for a detailed reconciliation. 2007, 2008, 2009 and 2011 excluded certain charges. Great Products ProStar Big Bore Engines Distribution Competitive Cost Flexible Manufacturing Product Maturity Legacy Costs Profitable Growth Market Share Global Presence Parts Profitability Niche Market Opportunities Military Integrated Vehicle More… |
 NYSE: NAV 87 Analyst Day February 1, 2012 87 What We’ve Heard Today Creating value through integration and differentiated thinking Core Truck – 10% return on sales Sustainable Military – Leveraged from commercial core Engine – Differentiator and catalyst for growth Global – Positioned for success |
 NYSE: NAV 88 Analyst Day February 1, 2012 88 $20 Billion Diversified Mfg Revenue Manufacturing Revenue 2008 $14 Billion $20 Billion $14 Billion Manufacturing Revenue 2011 Manufacturing Revenue at 350k Industry |
 NYSE: NAV 89 Analyst Day February 1, 2012 89 Manufacturing Segment Profit* Note: This slide contains non-GAAP information; please see the Reg G disclosure in the appendix for a detailed reconciliation. * As adjusted ($93) $11 $421 $838 $462 $1,088 $707 $741 $882 $1,800 - 50,000 100,000 150,000 200,000 250,000 300,000 350,000 400,000 450,000 500,000 -$500 $0 $500 $1,000 $1,500 $2,000 2003 2004 2005 2006 2007 2008 2009 2010 2011 At 350k Fiscal Year Manufacturing Segment Profit (Loss)* |
 NYSE: NAV 90 Analyst Day February 1, 2012 90 Elements of Strategic Success $1,200M Potential Mfg. Segment Profit* $882M $1,800M Mfg. Segment Profit* At 350k Note: This slide contains non-GAAP information; please see the Reg G disclosure in the appendix for a detailed reconciliation. *As adjusted Market Recovery Product Integration Product Maturity Scale Product Acceptance Integrated Product Line Grow w/Truck Grow w/Engine Expand Reach Latin America Brazil India 2011 Industry Expansion Margin Improvement Market Share Growth Parts Growth Global Growth Contingency |
 NYSE: NAV 91 Analyst Day February 1, 2012 91 Competitive Cost Structure Leveraging Assets/Controlling Destiny Scale 1-2-3 |
 NYSE: NAV Analyst Day February 1, 2012 * Note: This slide contains non-GAAP information; please see the Reg G disclosure in the appendix for a detailed ROIC calculation and reconciliation. Return on Invested Capital (ROIC) ROIC* = NOPAT PIC + Debt * See Appendix for detailed ROIC calculation ** Excluding ~$200 million in legacy pension and OPEB expenses. 1.7% 14.2% 5.9% 7.3% 10.7% 16.1% ~20.0% 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% FY 2007 FY 2008 FY 2009 FY 2010 FY 2011 At 350K Excluding Legacy Cost** 92 |
 NYSE: NAV 93 Analyst Day February 1, 2012 93 Capital Allocation Priorities Value is best created by executing the strategy Ensure adequate liquidity • Improving the return on invested capital – expand core business margins • Expanding current earnings multiples – consistent and predictable earnings • Improved working capital management • Fund long-term liabilities • Deliver consistent earnings and growth • Reduce debt • Return cash to shareholders Optimize the capital structure to drive value for shareholders |
 NYSE: NAV 94 Analyst Day February 1, 2012 2011 & 2012 Key Items 2011 Business Drivers 2012 Business Drivers • Industry at 262K • Industry recovering (275K – 310K) • Market share improving late • Expand market share – Class 8 • Military ~$2.0B revenue • Military ~ $1.5B • “Total” Global – breakeven • Global – profitable • Engineering – $532M • Engineering – flat to down • Core business margin improvement • Continue core business margin improvement • Adjusted mfg segment profit – $882M • Adjusted mfg segment profit – up to $1,150M • Pension & OPEB expense – $112M* • Pension & OPEB expense ~ $200M • Engineering Integration – $64M • Engineering Integration – completed Note: This slide contains non-GAAP information; please see the Reg G disclosure in the appendix for a detailed reconciliation. * Excludes restructuring-related charges of $57 million. – Protect Medium & Severe Service – Decreasing rate in 2 nd half |
 NYSE: NAV Analyst Day February 1, 2012 2012 Guidance (adjusted non-GAAP) $15.0 - $16.0 $1,000 - $1,150 $350 - $400 ~ 70 $5.00 - $5.75 $280 - $345 2012 Guidance – $5.00 - $5.75 EPS 2011 Actual (adjusted non-GAAP) 2012 Pro-Forma @ 2011 Tax and Pension & OPEB Rates Revenue (Billions) $14.0 $15.0 - $16.0 Adj. Mfg. Segment Profit (Millions) $882 $1,000 - $1,150 Adj. Net Income (Millions) $402 $490 - $530 Share Count (Millions) 76.1 ~ 70 Adj. Diluted EPS $5.28 $7.00 - $7.60 GAAP Net Income excl. VA release (Millions) $186 $405 - $460 Note: This slide contains non-GAAP information; please see the Reg G disclosure in the appendix for a detailed reconciliation. • Expanded segment profit – Margin improvement – Improved quality – Efficient manufacturing • Parts growth • Global expansion • Military revenue ~$500M lower • Tax rate ~25%-30% • Legacy Costs ~$90M higher 95 |
 NYSE: NAV Analyst Day February 1, 2012 Profitability Factors Q1 Full Year 2011 Adj. Net Income (Millions) $12 $402 2011 Adj. Diluted EPS $0.16 $5.28 Truck - N.A. volume / Supplier constraints - + Engine - Castings & Foundry start-up - + Military revenue - - Parts profitability +/ - + Core business margin improvement +/ - + + Financial services - - Legacy costs & taxes -- -- 2012 Adj. Net Income (Millions) $350 – $400 Note: This slide contains non-GAAP information; please see the Reg G disclosure in the appendix for a detailed reconciliation. 96 |
 NYSE: NAV 97 Analyst Day February 1, 2012 97 Manufacturing Cash Flow Note: This slide contains non-GAAP information; please see the Reg G disclosure in the appendix for a detailed reconciliation. Free Cash Flow $375M ~$1,200 ~$1,200 $950 $300 $275 $210 $75 $90 $0 $500 $1,000 $1,500 $2,000 2011 Mfg Cash Cash from operations Pension/OPEB Funding Maintenance CapEx Strategic Investments Share buyback Other 2012 Mfg Cash |
 NYSE: NAV 98 Analyst Day February 1, 2012 98 Continued Success in 2012 Note: This slide contains non-GAAP information; please see the Reg G disclosure in the appendix for a detailed reconciliation. 2007, 2008, 2009 and 2011 excluded certain charges. 2012 FY Guidance and Pro-Forma does not include engineering integration costs and restructuring of N.A. manufacturing operations. 2012 Guidance 2012 Pro-Forma 2007 Actual 2008 Actual 2009 Actual 2010 Actual 2011 Actual $(5.00) $ - $5.00 $10.00 $15.00 $20.00 $25.00 150 200 250 300 350 400 TRADITIONAL INDUSTRY VOLUME (000S ) Goal at Mature Strategy & 350k |
 NYSE: NAV 99 Analyst Day February 1, 2012 99 Manufacturing Segment Profit* Note: This slide contains non-GAAP information; please see the Reg G disclosure in the appendix for a detailed reconciliation. * As Adjusted ($93) $11 $421 $838 $462 $1,088 $707 $741 $882 $1,075 $1,800 - 50,000 100,000 150,000 200,000 250,000 300,000 350,000 400,000 450,000 500,000 -$500 $0 $500 $1,000 $1,500 $2,000 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Guidance Midpoint At 350k Fiscal Year Manufacturing Segment Profit (Loss)* |
 NYSE: NAV 100 Analyst Day February 1, 2012 100 Positioned Well for the Future Military N. A. Truck Engines Parts Global ~$1.5B FY 2012 Building the foundation for our future through integration Integration Integration |
 NYSE: NAV 101 Analyst Day February 1, 2012 101 Q&A |
 NYSE: NAV 102 Analyst Day February 1, 2012 102 Appendix |
 NYSE: NAV 103 Analyst Day February 1, 2012 103 SEC Regulation G Non-GAAP Reconciliation |
 NYSE: NAV 104 Analyst Day February 1, 2012 SEC Regulation G – 2012 Guidance & 2012 Pro Forma (A) Engineering integration costs relate to the consolidation of our truck and engine engineering operations as well as the move of our world headquarters, as we continue to develop plans for efficient transitions related to these activities and the optimization of our operations and management structure. Restructuring of North American manufacturing operations are charges primarily related to our plans to close our Chatham, Ontario heavy truck plant and Workhorse chassis plant in Union City, Indiana, and to significantly scale back operations at our Monaco recreational vehicle headquarters and motor coach manufacturing plant in Coburg, Oregon. (B) Pro forma adjustments are made to present adjusted fiscal 2012 guidance based on adjusted 2011 income tax rates and adjusted 2011 pension and OPEB charges. In 2011, we recognized an income tax benefit from the release of a portion of our income tax valuation allowance. As domestic earnings were taxable with the release of the income tax valuation allowance we recognized incremental domestic income tax expense for 2011 that would not have been recognized had we not released a portion of the income tax valuation allowance. The domestic income taxes were netted against the total benefit from the release of a portion of the income tax valuation allowance to arrive at an adjusted income tax rate of approximately 15% for 2011. The 2011 pension and OPEB charges of $169 million were reduced by $57 million related to restructuring activity for an adjusted 2011 pension and OPEB charge of $112 million. Pro forma adjustments excluding the valuation allowance release exclude the tax-impact related to engineering integration costs & restructuring of North American manufacturing operations. Lower Upper (in millions, except per share data) Net income attributable to Navistar International Corporation $ 280 $ 345 Plus: Engineering integration costs & restructuring of North American manufacturing operations, net of tax (A) 70 55 Adjusted net income attributable to Navistar International Corporation 350 400 Plus: Pro forma tax and pension & OPEB adjustments (B) 140 130 Adjusted pro forma net income attributable to Navistar International Corporation $ 490 $ 530 Diluted earnings per share attributable to Navistar International Corporation $ 4.00 $ 4.95 Effect of adjustments on diluted earnings per share attributable to Navistar International Corporation 1.00 0.80 Adjusted diluted earnings per share attributable to Navistar International Corporation 5.00 5.75 Effect of pro forma adjustments on diluted earnings per share attributable to Navistar International Corporation 2.00 1.85 Adjusted pro forma diluted earnings per share attributable to Navistar International Corporation $ 7.00 $ 7.60 Approximate diluted weighted shares outstanding 69.8 69.8 Lower Upper (in millions) Net income attributable to Navistar International Corporation $ 280 $ 345 Plus: Pro forma tax and pension & OPEB adjustments (B) 125 115 Adjusted pro forma net income attributable to Navistar International Corporation excluding valuation allowance release $ 405 $ 460 Lower Upper (in millions) Net income attributable to Navistar International Corporation $ 280 $ 345 Less: Financial services segment profit, Corporate and eliminations, and income taxes (620) (725) Manufacturing segment profit 900 1,070 Plus: Engineering integration costs & restructuring of North American manufacturing operations (A) 100 80 Adjusted manufacturing segment profit $ 1,000 $ 1,150 Fiscal 2012 guidance - Adjusted net income and diluted earnings per share attributable to Navistar International Corporation reconciliation: Fiscal 2012 guidance - Manufacturing segment profit and adjusted manufacturing segment profit reconciliation: Fiscal 2012 guidance - Adjusted pro forma net income attributable to Navistar International Corporation excluding valuation allowance release reconciliation: |
 NYSE: NAV 105 Analyst Day February 1, 2012 105 SEC Regulation G – Diluted EPS & Manufacturing Segment Profit vs. Traditional Industry Original Target Revised Target U.S. & Canada Industry 414,500 350,000 Sales and revenues, net $15 + $20 + Diluted earnings per share attributable to Navistar International Corporation $ 11.46 $ 12.31 Approximate diluted weighted shares outstanding ~ 72.5 ~ 72.5 (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 (in billions) |
 NYSE: NAV 106 Analyst Day February 1, 2012 106 SEC Regulation G – Adjusted Manufacturing Segment Profit – 2003-2011 (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. (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) Engineering integration costs relate to the consolidation of our truck and engine engineering operations, as well as the move of our world headquarters. These costs include restructuring charges for activities at our Fort Wayne facility and other related costs, including $51 million of engineering integration costs recognized by our manufacturing segment. (D) Restructuring of North American manufacturing operations are charges primarily related to our plans to close our Chatham, Ontario heavy truck plant and Workhorse chassis plant in Union City, Indiana, and to significantly scale back operations at our Monaco recreational vehicle headquarters and motor coach manufacturing plant in Coburg, Oregon. These costs include restructuring charges, as well as impairment charges related to certain intangible assets and property plant and equipment primarily related to these facilities, recognized by our Truck segment. 2011 2010 2009 2008 2007 2006 2005 2004 2003 (in millions) Net income (loss) attributable to Navistar International Corporation $ 1,723 $ 223 $ 320 $ 134 $ (120) $ 301 $ 139 $ (44) $ (333) Less: Financial services segment profit (loss) 129 95 40 (24) 127 147 136 132 87 Corporate and eliminations (571) (590) (519) (478) (662) (590) (412) (178) (310) Income tax benefit (expense) 1,458 (23) (37) (57) (47) (94) (6) (9) (17) Manufacturing segment profit 707 741 836 693 462 838 421 11 (93) Plus: Ford settlement, restructuring and related charges (benefits) (A) - - (160) 37 - - - - - Impairment of property, plant, and equipment (B) - - 31 358 - - - - - Engineering integration costs (C) 51 - - - - - - - - Restructuring of North American manufacturing operations (D) 124 - - - - - - - - Adjusted manufacturing segment profit $ 882 $ 741 $ 707 $ 1,088 $ 462 $ 838 $ 421 $ 11 $ (93) Manufacturing segment profit and adjusted manufacturing segment profit reconciliation: |
 NYSE: NAV 107 Analyst Day February 1, 2012 107 SEC Regulation G – Adjusted Diluted Earnings Per Share – Q1-2011 (A) Engineering integration costs relate to the consolidation of our truck and engine engineering operations as well as the move of our world headquarters. For the Three Months Ended January 31, 2011 (in millions) Net loss attributable to Navistar International Corporation Plus: Adjusted net income attributable to Navistar International Corporation For the Three Months Ended January 31, 2011 Diluted loss per share attributable to Navistar International Corporation Adjusted diluted earnings per share attributable to Navistar International Corporation Diluted weighted shares outstanding Adjusted net income attributable to Navistar International Corporation reconciliation: Adjusted diluted earnings per share attributable to Navistar International Corporation reconciliation: (6) 18 12 (0.08) 0.24 0.16 75.9 $ $ $ $ Effect of adjustments on diluted earnings per share attributable to Navistar International Corporation Engineering integration costs (A) |
 NYSE: NAV 108 Analyst Day February 1, 2012 SEC Regulation G – Adjusted Diluted Earnings Per Share – 2007-2011 See slide 110 for explanation of adjustments. 2011 2010 2009 2008 2007 (in millions) Net income (loss) attributable to Navistar International Corporation $ 1,723 $ 223 $ 320 $ 134 $ (120) Plus: Ford settlement, restructuring and related charges (benefits) (A) - - (157) 36 - Impairment of property, plant, and equipment (B) - - 31 358 - Write-off of debt issuance costs (C) - - 11 - 31 Engineering integration costs (D) 64 - - - - Restructuring of North American manufacturing operations (E) 127 - - - - Medicare Part D ruling (F) 15 - - - - Less: Income tax valuation allowance release, net (G) 1,527 - - - - Adjusted net income attributable to Navistar International Corporation $ 402 $ 223 $ 205 $ 528 $ (89) 2011 2010 2009 2008 2007 Diluted earnings (loss) per share attributable to Navistar International Corporation $ 22.64 $ 3.05 $ 4.46 $ 1.83 $ (1.71) Effect of adjustments on diluted earnings per share attributable to Navistar International Corporation 17.36 - 1.60 (5.38) (0.44) Adjusted diluted earnings per share attributable to Navistar International Corporation $ 5.28 $ 3.05 $ 2.86 $ 7.21 $ (1.27) Diluted weighted shares outstanding 76.1 73.2 71.8 73.2 70.3 Adjusted diluted earnings per share attributable to Navistar International Corporation reconciliation: Adjusted net income attributable to Navistar International Corporation reconciliation: |
 NYSE: NAV 109 Analyst Day February 1, 2012 109 SEC Regulation G – Return on Invested Capital See slide 110 for explanation of adjustments. * Return on Invested Capital equals NOPAT divided by invested capital (PIC plus debt). ROIC is based on AVERAGE invested capital for each year, where the average annual invested capital is the simple average of the current and prior years' invested capital. ROIC Calculation: 2007 2008 2009 2010 2011 At 350k (in millions) Net income (loss) attributable to Navistar International Corporation (120) $ 134 $ 320 $ 223 $ 1,723 $ 900 $ Plus: Ford settlement, restructuring and related charges (benefits) (A) - 36 (157) - - - Impairment of property, plant, and equipment (B) - 358 31 - - - Write-off of debt issuance costs (C) 31 - 11 - - - Engineering integration costs (D) - - - - 64 - Restructuring of North American manufacturing operations (E) - - - - 127 - Medicare Part D ruling (F) - - - - 15 - Less: Income tax valuation allowance release, net (G) - - - - (1,527) - Adjusted net income attributable to Navistar International Corporation (89) $ 528 $ 205 $ 223 $ 402 $ 900 $ Interest Expense 502 469 251 253 247 Less: Financial Services Interest Expense 306 313 161 113 109 Manufacturing Interest 196 $ 156 $ 90 $ 140 $ 138 $ 150 $ Net Operating Profit After Taxes (NOPAT) 107 684 295 363 540 1,050 Net Long-Term Mfg Operations Debt 1,665 1,639 1,670 1,841 1,881 1,900 Financial Services Bank revolvers, at fixed and variable rates 1,354 1,370 1,518 974 1,072 1,100 Mfg Long Term Debt incl. Revolver 3,019 $ 3,009 $ 3,188 $ 2,815 $ 2,953 $ 3,000 $ Plus: Additional Paid in Capital (PIC) 1,954 1,966 2,071 2,206 2,253 2,253 Less: Common Stock Held in Treasury (165) (137) (149) (124) (191) (270) Plus: Accumulated Positive Earnings (Retained Earnings) - - - - - 2,000 Invested Capital 4,808 $ 4,838 $ 5,110 $ 4,897 $ 5,015 $ 6,983 $ Average Annual Invested Capital* 4,345 $ 4,823 $ 4,974 $ 5,004 $ 5,034 $ 6,503 $ ROIC 2.5% 14.2% 5.9% 7.3% 10.7% 16.1% |
 NYSE: NAV 110 Analyst Day February 1, 2012 110 SEC Regulation G – Adjusted Manufacturing Segment Profit (2003-2011) & ROIC – (Continued) (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 during 2009 and 2007 represent charges related to the Company's refinancing. (D) Engineering integration costs relate to the consolidation of our truck and engine engineering operations as well as the move of our world headquarters. These costs include restructuring charges for activities at our Fort Wayne facility of $29 million for the year ended October 31, 2011. We also incurred $35 million of other related costs for the year ended October 31, 2011, respectively. (E) Restructuring of North American manufacturing operations are charges primarily related to our plans to close our Chatham, Ontario heavy truck plant and Workhorse chassis plant in Union City, Indiana, and to significantly scale back operations at our Monaco recreational vehicle headquarters and motor coach manufacturing plant in Coburg, Oregon. These costs include restructuring charges of $58 million for the year ended October 31, 2011. We also incurred $5 million of other related costs for the year ended October 31, 2011. In addition, the Company recognized $64 million of impairment charges related to certain intangible assets and property plant and equipment primarily related to these facilities. (F) In the fourth quarter of 2011, the Company had an unfavorable ruling related to a 2010 administrative change the Company made to the prescription drug program under the OPEB plan affecting plan participants who are Medicare eligible. As a result the Company recognized approximately $15 million of expense for postretirement benefits. (G) In the third quarter of 2011, we recognized an income tax benefit of $1.476 billion from the release of a portion of our income tax valuation allowance. In the fourth quarter of 2011, we recognized an additional income tax benefit of $61 million related to the release of a portion of our income tax valuation allowance. As domestic earnings are now taxable with the release of the income tax valuation allowance we recognized $10 million of domestic income tax expense for 2011 that would not have been recognized had we not released a portion of the income tax valuation allowance. The $10 million of domestic income taxes were netted against the total benefit of $1.537 billion from the release of a portion of the income tax valuation allowance. In addition, the other adjustments included in the table above have not been adjusted to reflect their income tax effect as the adjustments are intended to represent the impact on the Company's Consolidated Statement of Operations without the incremental income tax effect that would result from the release of the income tax valuation allowance. The charges related to our Canadian operations would not be impacted as a full income tax valuation allowance remains for Canada. |
 NYSE: NAV 111 Analyst Day February 1, 2012 111 SEC Regulation G – Adjusted Net Income – 2011 (A) In the third quarter of 2011, we recognized an income tax benefit of $1.476 billion from the release of a portion of our income tax valuation allowance. In the fourth quarter of 2011, we recognized an additional income tax benefit of $61 million related to the release of a portion of our income tax valuation allowance. 2011 (in millions) Net income attributable to Navistar International Corporation $ 1,723 Less: Income tax valuation allowance release, net (A) 1,537 Adjusted net income attributable to Navistar International Corporation (excluding the release of the valuation allowance) $ 186 Adjusted net income attributable to Navistar International Corporation (excluding the release of the valuation allowance) reconciliation: |
 NYSE: NAV 112 Analyst Day February 1, 2012 112 SEC Regulation G – Manufacturing Cash October 31, 2011 (in millions) Manufacturing segment cash and cash equivalents $ 488 Financial services segment cash and cash equivalents 51 Consolidated cash and cash equivalents $ 539 Manufacturing marketable securities $ 698 Financial services segment marketable securities 20 Consolidated marketable securities $ 718 Manufacturing segment cash and cash equivalents 488 Manufacturing marketable securities 698 Manufacturing segment cash, cash equivalents and marketable securities $ 1,186 Manufacturing cash, cash equivalents, and marketable securities reconciliation: |
 NYSE: NAV Analyst Day February 1, 2012 FY 2012 Forecast - Truck Chargeouts Note: Charegouts for FY 2012 exclude RV towable units. 0 5,000 10,000 15,000 20,000 25,000 30,000 35,000 40,000 45,000 50,000 2012 Forecast 2012 Forecast 2012 Forecast 2012 Forecast Q1 Q2 Q3 Q4 Traditional Expansionary 113 |
 NYSE: NAV 114 Analyst Day February 1, 2012 114 Frequently Asked Questions Q1: How many Dealcor dealers did you have as of October 31, 2011? A: Of our 287 primary NAFTA dealers, we have ownership interest in 7 DealCor dealers as of December 31, 2011. Q2: How do you fund your wholesale business? A: We primarily finance our wholesale portfolio through NFC, funded with traditional private or public securitizations, and through NFC’s bank facility. Q3: How is your NFC portfolio performing? A: NFC‘s wholesale portfolio performed exceptionally in 2011 and is expected to see little or no losses again in 2012. NFC’s retail portfolio in the U.S. is in run-off mode now that Navistar Capital, the new GE Capital retail program, is financing retail customers. Q4: What is your total amount of capacity at NFC? A: As of December 31, 2011, total availability in our U.S. funding facilities is $587 million. Q5: What is included in Corporate and Eliminations? A: 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. Q6: What is the status of the High Mobility Multipurpose Wheeled Vehicle (HMMWV) Modernized Expanded Capacity Vehicle (MECV) program? A: A date for request for proposals has not been specified. An official update on the program is not expected until the defense budget is unveiled. |
 NYSE: NAV 115 Analyst Day February 1, 2012 115 Frequently Asked Questions Q7: What is the current Joint Light Tactical Vehicle (JLTV) program status? A: A revised final request for proposals for the Engineering, Manufacturing and Development (EMD) phase was issued on January 26, 2012. Q8: 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 segment financials. Q9: How will the changing Department of Defense (DoD) budget affect Navistar in FY 2012? A: The coming year will present challenges, but Navistar’s commercial expertise may be an advantage when the DoD is asked to do more with less. In addition, the Company continues to pursue a number of foreign military opportunities, especially in the Middle East, where defense spending is growing. Finally, the Company has a fleet of more than 32,000 vehicles in operation in approximately 26 countries, including more than 9,000 vehicles operating with Afghan Security Forces. These vehicles will require parts and sustainment support throughout their lifecycles. Q10: How does your FY 2012 Class 8 industry compare to ACT Research? A: Reconciliation to ACT 2012 ACT* 247,399 CY to FY adjustment (3,607) Other misc. specialty vehicles Included in ACT (5,500) Total (ACT comparable Class 8 to Navistar) 238,292 Navistar Industry Retail Deliveries Combined Class 8 Trucks 216,500 Navistar difference from ACT: 21,792 10.1% *Source: ACT N.A. Commercial Vehicle Outlook - Jan, 2011 U.S. and Canadian Class 8 Truck Sales |
 NYSE: NAV 116 Analyst Day February 1, 2012 116 Frequently Asked Questions Q11: Why did the Company release a significant portion of its domestic deferred tax valuation allowance? A: Q12: A: Beginning in 2012, we would estimate future effective tax rates to fall in the upper 20% to low 30% range. Q13: A: The release of deferred tax valuation allowances is an accounting adjustment, which reinstates the Company’s deferred tax assets on its balance sheet. It has no impact on actual cash tax payments. Q14: What is the current balance of net operating losses as compared to other deferred tax assets? A: As of October 31, 2011 the Company has U.S. federal net operating losses (NOLs) valued at $126 million, state NOLs valued at $79 million and foreign NOLs valued at $102 million, for a total undiscounted cash value of $307 million. In addition to NOLs, the Company has accumulated tax credits of $208 million and other deferred tax assets of $1.8 billion resulting in total deferred tax assets of approximately $2.3 billion. Q15: When do you expect to exhaust your U.S. NOLs and tax credits? A: We expect to be able to utilize remaining NOLs and accumulated tax credits over the next three to four years, which will keep our cash tax payments low in the near term. The Company evaluated a variety of criteria, both objective and subjective, and concluded that a significant portion of its U.S. deferred tax valuation allowance should be released in 2011 based on its judgment that (on a more likely than not basis) it will realize the value of these deferred tax assets in the future. That judgment considered, among others things, the Company’s recent history of delivering profits in a depressed market, as well its confidence in the future profitability of its U.S. operations. How does the release of deferred tax valuation allowances affect future effective tax rates? How will the release of deferred tax valuation allowances impact future cash tax payments? |
 NYSE: NAV 117 Analyst Day February 1, 2012 117 Frequently Asked Questions Q16: How will $2.3 billion of deferred tax 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 immediately 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 offset future taxable income. Q17: How would future tax proposals to reduce U.S. tax rates impact Navistar? A: While lower tax rates would favorably impact future tax expense, because of the Company’s large balance of deferred tax assets we would incur a one-time adverse impact to our P&L to reset/reduce our deferred tax balances to the lower statutory rates. We estimate that for every 1% reduction in tax rates, we would incur an immediate, one-time tax increase of $50 million. Q18: How does vertical integration of big bore engines 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. Q19: What are your expected 2012 and beyond pension funding requirements? A: Current forecasts indicate that we may need to contribute approximately $187 million in 2012 to our U.S. and Canadian pension plans (the Plan). 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 2013 through 2015, the Company will be required to contribute at least $170 million per year to the Plan, depending on asset performance and discount rates. Q20: What is your expected 2012 pension and OPEB GAAP expense? A: FY 2012 pension and OPEB GAAP expense is currently estimated at approximately $200 million based on the October 31, 2011 measurement of obligations and assets. FY 2011 pension and OPEB expenses were $112 million, plus $57 million of restructuring related charges that are excluded from the presentation of Adjusted Manufacturing Segment Profit. Excluding the restructuring related charges in 2011, pension and OPEB expenses within the manufacturing segments are expected to be relatively flat between FY 2011 and FY 2012. |
 NYSE: NAV 118 Analyst Day February 1, 2012 118 Frequently Asked Questions Q21: What causes the variance between manufacturing cash interest payments and GAAP interest expense? A: Q22: What are the $225 million of Recovery Zone Facility Bonds (RZFBs) Series 2010 due October 15, 2040 being used for? A: Q23: Why did you use Recovery Zone Facility Bond (RZFB) financing? A: 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 us exposure to a new source of investors that we wouldn’t otherwise have access to if not for the RZFB program. Q24: What should we assume for capital expenditures in fiscal 2012? A: We plan to continue capital spending within the traditionally guided range of $250 million to $350 million for products and development. Capital spending related to Engineering Integration is funded through the RZFBs and is not included in that range. 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, manufacturing interest expense is higher than cash interest payments due to the amortization of debt issuance costs which are amortized over the life of each note, amortization of the original issue discount of the high yield notes and amortization of the embedded call option in the convertible notes. The timing of interest payments also impacts this variance on a quarterly basis, but not on a fiscal year basis. We are using the proceeds to invest in our product development strategy and our headquarter 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 the RZFBs 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. |