8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): December 22, 2009

NAVISTAR INTERNATIONAL CORPORATION

(Exact name of registrant as specified in its charter)

Delaware	1-9618	36-3359573
(State or other jurisdiction of incorporation or organization)	(Commission File No.)	(I.R.S. Employer Identification No.)

4201 Winfield Road, P.O. Box 1488, Warrenville, Illinois	60555
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code (630) 753-5000

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

PAGE 2

ITEM 2.02 RESULTS OF OPERATIONS AND FINANCIAL CONDITION

In accordance with General Instruction B.2. to Form 8-K, the following information shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such a filing.

The information regarding the results of operations and financial condition of Navistar International Corporation (the “Company”) responsive to this Item 2.02, and contained in Exhibit 99.1 filed herewith, is incorporated into this Item 2.02 by reference.

ITEM 7.01 REGULATION FD DISCLOSURE

In accordance with General Instruction B.2. to Form 8-K, the following information shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such a filing.

Navistar International Corporation, the nation’s largest combined commercial truck, school bus and mid-range diesel engine producer, previously announced that it will present via live web cast its fiscal 2009 fourth quarter and year-end financial results on Tuesday, December 22^nd. A live web cast is scheduled at approximately 10:00 AM ET. Speakers on the web cast will include Daniel C. Ustian, Chairman, President and Chief Executive Officer, A. J. Cederoth, Executive Vice President and Chief Financial Officer, and other Company leaders. Copies of the slides containing financial and operating information to be used as part of the web cast are attached as Exhibit 99.1 to this Current Report and are incorporated by reference herein.

The web cast can be accessed through a link on the investor relations page of Navistar’s web site at http://ir.navistar.com/events.cfm. Investors are advised to log on to the website at least 15 minutes prior to the start of the web cast to allow sufficient time for downloading any necessary software. The web cast will be available for replay at the same address approximately three hours following its conclusion, and will remain available for a period of 10 days.

Navistar International Corporation (NYSE: NAV) is a holding company whose subsidiaries and affiliates subsidiaries produce International^® brand commercial and military trucks, MaxxForce^® brand diesel engines, IC Bus™ brand school and commercial buses, Monaco RV brands of recreational vehicles, and Workhorse^® brand chassis for motor homes and step vans. It also is a private-label designer and manufacturer of diesel engines for the pickup truck, van and SUV markets. The company also provides truck and diesel engine service parts. Another affiliate offers financing services. Additional information is available at www.Navistar.com/newsroom.

PAGE 3

ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS

(d) Exhibits

Exhibit No.	Description	Page
99.1	Slide Presentation for Fourth Quarter Financial Results Web Cast to be held on December 22, 2009

Forward Looking Statements

Information provided and statements contained in this report 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 report and the Company assumes no obligation to update the information included in this report. 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, of our Form 10-K for the fiscal year ended October 31, 2009, which was filed on December 21, 2009. 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.

PAGE 4

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	NAVISTAR INTERNATIONAL CORPORATION
	Registrant
Date: December 22, 2009	/s/    ANDREW J. CEDEROTH
	Andrew J. Cederoth Chief Financial Officer

EX-99.1

NYSE: NAV

1

4th Quarter 2009 Earnings Presentation

December 22, 2009

Exhibit 99.1

NYSE: NAV

2

2

Safe Harbor

Statement

Information provided and statements contained in this presentation that are not purely historical

are forward-looking statements within the meaning of Section

27A of the Securities Act of 1933,

as amended, Section

21E of the Securities Exchange Act of 1934, as amended, and the Private

Securities Litigation Reform Act of 1995. Such forward-looking statements only speak as of the

date of this presentation and the Company assumes no obligation to update the information

included in this presentation. Such forward-looking statements include information concerning

our possible or assumed future results of operations, including descriptions of our business

strategy.

These

statements

often

include

words

such

as

“believe,”

“expect,”

“anticipate,”

“intend,”

“plan,”

“estimate,”

or similar expressions. These statements are not guarantees of performance

or results and they involve risks, uncertainties, and assumptions. For a further description of

these factors, see Item

1A, Risk Factors, included within our Form 10-K for the year ended

October

31, 2009, which was filed on December 21, 2009. Although we believe that these

forward-looking statements are based on reasonable assumptions, there are many factors that

could affect our actual financial results or results of operations and could cause actual results to

differ materially from those in the forward-looking statements. All future written and oral forward-

looking statements by us or persons acting on our behalf are expressly qualified in their entirety

by the cautionary statements contained or referred to above. Except for our ongoing obligations

to disclose material information as required by the federal securities laws, we do not have any

obligations or intention to release publicly any revisions to any forward-looking statements to

reflect events or circumstances in the future or to reflect the occurrence of unanticipated events.

NYSE: NAV

3

3

Other Cautionary Notes

•

The financial information herein contains audited and unaudited

information and has been prepared by management in good faith

and based on data currently available to the company.  

•

Certain Non-GAAP measures are used in this presentation to assist

the reader in understanding our core manufacturing business.

We

believe this information is useful and relevant to assess and

measure the performance of our core manufacturing business as it

illustrates manufacturing performance without regard to selected

historical legacy costs (i.e. pension and other postretirement costs).

It also excludes financial services and other expenses that may not

be related to the core manufacturing business.  Management often

uses this information to assess and measure the performance of our

operating segments.

A reconciliation to the most appropriate GAAP

number is included in the appendix of this presentation.

NYSE: NAV

4

4

Summary

•

2009 Q4 and year-end results

•

Controlling Our Destiny:

–

Cash, SGA, and Capital structure

•

January 19

th

Investor Day

Original 2009 Goal based on 415K unit

Original 2009 Goal based on 415K unit

industry:

industry:

$15

$15

Billion

Billion

in

in

revenue

revenue

and

and

profitable

profitable

at

at

all

all

points

points

in

in

the

the

cycle

cycle

NYSE: NAV

What we said on the 3

rd

quarter call for full

year 2009

Note:

This

slide

contains

non-GAAP

information,

please

see

the

Reg

G

in

appendix for detailed reconciliation

We continue to invest today, to ensure the future

5

9/10/09

2009

Guidance

Actual

$710 to $735 million

$707 million

Manufacturing Cash

$650 to $750 million

$1.1 billion

Industry Volume Reduction to 210,000 to 225,000

Industry Volume Reduction to 165,000 to 185,000

Warranty

R&D spending

Taxes

(-)

Customer Mix

(-), offset by

SG&A below

Offsetting Actions

Lower commodity Costs / cost reductions

Blue Diamond JV operational impact

Military revenue:  $2.7B to $3.0B

Market Share

Parts profitability

SG&A / Below the Line items

+, offset by

customer mix above

EPS Guidance/Actuals*

$2.55 to $2.85

$2.86

Settlement and related restructuring

$2.40 +/-

$2.19

EPS Guidance/Actuals**

$4.95 to $5.25

$5.05

Refinancing costs and restructuring actions

NA

($0.59)

Diluted EPS as reported

$4.46

*Excludes settlement, restructuring and refinancing costs

**Excludes refinancing costs and restructuring actions

Key Challenges

Manufacturing Segment Profit*

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6

Full Year 2009

*Note:

This

slide

contains

non-GAAP

information,

please

see

the

Reg

G

in

appendix

for

detailed

reconciliation

NYSE: NAV

7

404,700

345,500

269,300

77,900

90,900

0

50,000

100,000

150,000

200,000

250,000

300,000

350,000

400,000

450,000

FY 2007

FY 2008

FY 2009

Q408

Q409

2009 Full Year and 4Q Information

Consolidated Revenues

($ in millions)

Yearly and Quarterly Truck  Chargeouts

Yearly and Quarterly Engine Shipments

Y/Y

Shipments

decreased

~22%

Q/Q

Shipments

increased

~17%

Y/Y

Chargeouts

decreased

~25%

Q/Q

Chargeouts

decreased

~17%

$12,295

$14,724

$11,569

$3,870

$3,285

$0

$2,000

$4,000

$6,000

$8,000

$10,000

$12,000

$14,000

$16,000

FY 2007

FY 2008

FY 2009

Q408

Q409

Q/Q

Revenues

decreased

~15%

113,600

102,200

76,800

28,700

23,700

0

20,000

40,000

60,000

80,000

100,000

120,000

FY 2007

FY 2008

FY 2009

Q408

Q409

NYSE: NAV

8

8

2009 Full Year and 4Q Information:

Profitable at all points in the cycle

Note:  This slide contains both GAAP and non-GAAP information,

please see the Reg

G in appendix for detailed reconciliation.

Yearly Diluted Earnings (loss) per share

Quarterly Manufacturing Segment Profit ($ in millions)

Yearly Manufacturing Segment Profit ($ in millions)

Quarterly Diluted Earnings (loss) per share

$693

$836

$1,088

$707

$0

$200

$400

$600

$800

$1,000

$1,200

FY 2008 With

Impacts

FY 2009 With

Impacts

FY 2008

Without

Impacts

FY 2009

Without

Impacts

$1.82

$4.46

$7.21

$2.86

$0.00

$1.00

$2.00

$3.00

$4.00

$5.00

$6.00

$7.00

$8.00

FY 2008 With

Impacts

FY 2009 With

Impacts

FY 2008 Without FY 2009 Without

Impacts

Impacts

($4.81)

$1.19

$0.56

$1.99

-$6.00

-$5.00

-$4.00

-$3.00

-$2.00

-$1.00

$0.00

$1.00

$2.00

$3.00

4Q08 With

Impacts

4Q09 With

Impacts

4Q08 Without

Impacts

4Q09 Without

Impacts

($168)

$232

$217

$279

-$200

-$150

-$100

-$50

$0

$50

$100

$150

$200

$250

$300

$350

4Q08 With

Impacts

4Q09 With

Impacts

4Q08 Without

Impacts

4Q09 Without

Impacts

NYSE: NAV

2009 4Q Information

•

FY2009 EPS by quarter:

1Q -

$0.67; 2Q -

$0.60; 3Q -

$(0.42); 4Q -

$1.99

•

4

th

quarter is typically our strongest quarter

•

Operating days -

1

st

and 3

rd

quarters have fewer

operating days (summer and holiday shutdowns)

•

Cost reductions

•

Quarter and full-year results because we have

been successful in the marketplace

17,000

23,700

0

5,000

10,000

15,000

20,000

25,000

3Q09

4Q09

63,600

90,900

0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

80,000

90,000

100,000

3Q09

4Q09

$491

$565

$0

$100

$200

$300

$400

$500

$600

3Q09

4Q09

Part Revenues ($ in millions)

Truck Chargeouts

($ in millions)

Engine Shipments ($ in millions)

Chargeouts

sequentially 

increased by

39% or

6,700 units

Shipments

sequentially

increased by

43% or

27,300 units

Revenues

sequentially

increased by

15% or

$74 million

9

NYSE: NAV

10

10

Medium

Truck

Great Products –

Market Share

66% Market Share

4Q09

39% Market Share

4Q09

33% Market Share

4Q09

Severe

Service

Truck*

Heavy

Truck

24% Market Share

4Q09

FY07

60%

FY08

55%

FY09

61%

*Note: Excludes U.S. Military shipments. See market share slide in appendix for shipments with and without military shipments.

School Bus & Combined Class 6-8 Market Share –

FY07: 26%; FY08: 29%; FY09: 34%

FY07

36%

FY08

36%

FY09

35%

FY07

25%

FY08

27%

FY09

34%

FY07

15%

FY08

19%

FY09

25%

Class 8*

27% Market Share

4Q09

School

Bus

(U.S. & Canada)

Market share based on brand

NYSE: NAV

11

11

International

Dealer

Stock

Inventory

(Units)

*

U.S. and Canada Dealer Stock Inventory

*Includes U.S. and Canada Class 4-8 and school bus inventory, but does not include Workhorse Custom Chassis inventory.

-

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

10,000

11,000

12,000

13,000

NYSE: NAV

12

12

Leveraging Our Assets while

Controlling Our Destiny

•

Over last five years we

have spent over $2 billion

in engineering and product

development costs

•

On average this is $412

million per year

•

We have continued to

invest while others have

reduced investment

12

*Exclusive of purchases of equipment leased to others

Advanced EGR In-Cylinder

NOx

Reduction

(in millions)

$413

$453

$375

$384

$433

$0.00

$100.00

$200.00

$300.00

$400.00

$500.00

FY2005

FY 2006

FY 2007

FY 2008

FY 2009

Good Results While Investing in Future

NYSE: NAV

13

13

Investments in 2009 for Future

Results

•

Monaco

•

TEMs

•

Modec

(Electric)

•

Global Bus

•

NC

2

(Cat JV)

•

Mahindra

•

2010 Emissions

•

MaxxForce

15L

®

•

Pure Power

Technologies

13

Advanced EGR In-Cylinder

NOx Reduction

Amminex

has

developed Solid

Ammonia

Storage and

Delivery System

NYSE: NAV

14

14

SG&A

Objectives for 2009 met

•

Year-over-year cost reductions

–

Other SG&A / fixed costs ~$150M

–

Professional (filing) fees ~ $100M

Where are we today?

FY2009

FY2008

Change

SG&A (excluding items below)

$1,088

$1,326

($238)

Professional fees

40

165

(125)

Post retirement

216

(54)

270

Total SG&A

$1,344

$1,437

($93)

(in millions)

NYSE: NAV

15

15

Post Retirement Pension & Health Care

•

Closed plan to new entrants in 2002

-

Majority of new entrants closed in 1996

-

Annual service cost is decreasing

•

2009 higher cost caused by 2008 market decline

-

Revised investment strategy/investment advisor

-

FY2009 return 15.8% for pension plan and 15.6% for OPEB

-

Expect cost to improve/neutral

•

Aggressive cost control, without service cuts (health care)

-

Cost contained

Contained

NYSE: NAV

16

16

Date

Financial Services Actions

Completed

April

$300 million –

NFC Retail Securitization

August

$650 million –

NFC Dealer Floor Plan Renewal

(capacity dropped to $500M upon completion of November TALF

deal)

October

$100 million –

NFC Retail Account Facility Renewal

November

$350 million –

NFC Dealer Floor Plan TALF Deal

December

$815 million –

NFC Revolver/Term Loan Refinancing

December

$304 million –

Private Placement Sale

Navistar’s 2009 Refinancing Plan is Complete

Date

Manufacturing Action

Completed

October

$1.5 billion –

NIC Refinancing

NYSE: NAV

17

17

NIC (Manufacturing) Refinancing Enhanced

Balance Sheet Stability

The NIC refinancing reduced balance sheet risk and increased

financial flexibility

Extended maturity profile with staggered maturities and limited/no dilution

Increased flexibility and cost effective (6.34% cash APR)

Maintained modest leverage levels, set to improve with truck cycle rebound

*No economic dilution until average stock price at or above $60.14

*

$0

$500

$1,000

$1,500

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

2021

2022

Reduced refinancing risk by splitting and extending maturities

Maturity profile

($ in millions)

Source:

Company filings

Existing debt

Refinanced

debt

$67

$112

$1,330

$570

$72

$24

$1,000

$34

Fiscal Year

NYSE: NAV

18

18

Manufacturing Cash

Note:

This

slide

contains

non-GAAP

information,

please

see

the

Reg

G

in

appendix

for

detailed

reconciliation.

($ in millions)

July 31, 2009 ending cash

$751

Cash flow from operations (including working capital)

$385

Capital spending/investment

(92)

Net cash impact - NIC refinancing

126

Other financing cashflow

(18)

Net change in manufacturing cash

$401

October 31, 2009 manufacturing Cash

$1,152

Accounting consolidation of Blue Diamond

(13)

October 31, 2009 ending manufacturing cash

$1,139

NYSE: NAV

19

19

Investor

&

Analyst

Day

–

January

19,

2010

Make Your Reservation

Navistar’s Investor & Analyst Day

Tuesday, January 19, 2010

Melrose Park Engine Facility

Melrose Park, IL

11:30 a.m. –

4 p.m. CST

Lunch, Presentation with Q&A

Plant Tour, Lab Demos & Product Displays

Reservation Required

Please contact Suzanne Sorensen at Suzanne.Sorensen@Navistar.com

to RSVP

NYSE: NAV

20

20

What to expect on January 19

•

Delivering on our Commitments:

–

2010 earnings guidance

–

$2 billion military sustainable

•

2010 Priorities:

–

Postretirement

–

NFC

–

Engine

•

Product and product displays to

address the myths vs. realities:

–

2010 readiness

–

0.5 NOx/0.2 NOx

–

Myths –

Heat/Fuel

–

Alternative future technologies

–

Growth Markets

Advanced EGR In-Cylinder

NOx

Reduction

NYSE: NAV

21

21

Summary-2010 Emission Strategy Status

2010 emission strategy on/ahead of schedule

•

All engines will be between 0.4 and 0.5 NOx

•

Engine durability testing is on track and plan to over-test and stress many parts of

the system

•

In most cases, vehicles will have equal to or better fuel economy than 2009

vehicles

•

Base engine will have less heat than 2009 engines

•

ProStar

®

vehicle weight will be reduced by over 700 lbs.

•

100 test vehicles in operation today

NYSE: NAV

22

22

Current status:

•

More than 21 months of testing between engine

labs and field test units

•

100 test vehicles in operation today

•

Validation testing includes:

-

High-altitude and high-temperature testing in

Nevada and mountainous regions of Colorado

-

Cold weather testing conducted this past

January to March in Minnesota and Colorado

-

We will continue to validate and make final

calibration adjustments this winter in

Minnesota, Alaska and Colorado

Next steps:

•

Receive EPA certification prior to 2010 launch

•

Launch

Controlling Our Destiny

2010 Engine Testing -

On Track or Ahead of Schedule

NYSE: NAV

23

23

Navistar Delivers First 2010 Emissions-

Navistar Delivers First 2010 Emissions-

Ready School Buses

Ready School Buses

December 7, 2009

Columbus, Mississippi

NYSE: NAV

24

24

Advanced EGR Gives Us a

Competitive Advantage

61% Market Share

FY 2009

School

Bus

35% Market Share

FY 2009

34% Market Share

FY 2009

Severe

Service

Truck*

Heavy

Truck

25% Market share

FY 2009

Medium

Truck

2009 Industry :

Heavy Day Cab –

16%

Heavy Sleeper –

30%

*Note: Excludes U.S. Military deliveries.

Market share based on brand

NYSE: NAV

25

25

MaxxForce

®

15L status and strategy

Actions in 2009 for 2010 and Beyond

15 Liter 2010 Emission Strategy

Current status:

•

More than 12 months of testing, which

includes high-altitude and

high-temperature testing

•

Provide advance production units to

strategic customers

•

Production in late calendar 2010

Actions and product attributes to

ensure success in 2010:

•

Transition some 15L customers to the

MaxxForce

®

11L/13L

•

Significant engine weight savings

•

Better manage heat rejection

•

Product testing on/ahead of schedule

Today

2009 Transition

2010

Big Bore

11L-15L

11L/13L

46%

15L

54%

<425 hp

12%

425-455 hp

64%

475-550 hp

24%

MaxxForce

®

11L/13L

330 hp-475 hp @ 1900

rpm

1250-1700 hp lb.–ft.

@ 1000 rpm

NYSE: NAV

26

Mahindra Navistar Automotives Ltd.

Passenger Bus

Overall commercial vehicle industry (in units)

Note:

Mahindra

FY

–

April

to

March

Mahindra/Navistar

J.V.

is

a

51%

-

49%

joint venture

150,000

170,000

190,000

210,000

230,000

250,000

270,000

290,000

310,000

330,000

350,000

FY 2009

Actual

FY 2010

Estimate

FY 2011

Estimate

FY 2012

Estimate

New Heavy Truck Launch –

January 2010

Light Truck

NYSE: NAV

27

TEM/End Customer Strategy

•

Compete in Class A, Class B, Class C

and towables

•

2009 Industry market in Class A

~5,900 units

•

#1 in diesel Class A RV market share

•

Growth opportunities in:

-

Towables

-

Vertical integration of engine

-

Parts

•

Largest privately-held mixer

manufacturer in North America

•

Industry market share ~6,000 units

•

Currently ~10% market share

•

Opportunities:

-

EGR engine strategy

Domestic growth

-

Jobs creation

-

Obama stimulus package

•

Global growth

-

NC²

•

#1 in market share despite industry

consolidation

•

MaxxForce

®

EGR

engines

Rest of World Focus

•

Capitalize on large market in South

America

•

Emerging market in Mexico driven by

government funding

-

Partnership with Neobus

•

The launch is currently on plan with ramp-

up through early 2010

•

Low cost/high quality design capability

•

Long-term potential for U.S. and Canada

NOTE:

J.V. pending -

MOU with San Marino (Neobus)

for integrated  commercial bus body J.V.

assembly plant in Mexico

Bus

Bus

Continental Mixer

Continental Mixer

Profitable Growth

Profitable Growth

Monaco

Monaco

NYSE: NAV

28

28

Actions in 2010 and Beyond:

Caterpillar/Navistar Strategic Alliance/ NC

2

Joint Venture

•

Strategic

alliance

to

manufacture

a

heavy-duty

Caterpillar vocational truck

•

Manufactured by Navistar in

Garland, TX

•

Expected mid-2011

Global Commercial Truck Markets

Outside of N.A.

North America Caterpillar Vocational

•

50/50

joint

venture

for

commercial

trucks outside of North America formed

September 2009

•

Leverages the complementary

strengths of both companies

-

CAT –

distribution

-

Navistar –

manufacturing and product

development

•

First products available in fiscal Q2 of

2010

NYSE: NAV

29

29

Controlling Our Destiny:

Investing in Fuel Systems

•

Skilled workforce

•

Engineering staff

•

Intellectual property

Core

Competency

Fuel Systems Plant

R&D Center

Physical Assets

Control Cost                  Control Technology

NYSE: NAV

30

Customer Friendly Solutions

TENNECO and GE Transportation to Develop

Hydrocarbon-SCR Technology for Diesel

Emission Aftertreatment

4 February 2009

Eaton Evaluates Unique Emission Control

Technology

22 June 2006

17 July 2008

Scania: EGR cost effective and

convenient.

Just add diesel!

Solid NH3 cartridge

Advanced EGNR

Next generation of EGR

Dealer

and

customer

friendly

Easy for

operators

Easy to

maintain

and

understan

d

NYSE: NAV

31

31

Full Year 2010 Initial Outlook

2010 Initial

Outlook

Industry volume

175,000 to 215,000

R&D spending

flat

Interest expense

up

Military revenue

at least $2 billion

Loss of Ford engine volume

production ceases 12/31/09

Market share

maintain to increase

2010 strategy impact

up in 2nd half

Global growth - Monaco/TEMs

starting in 2010

NYSE: NAV

32

32

Summary

Combined

34% Market Share

FY 2009

Advanced EGR In-Cylinder

NOx

Reduction

Military sustainable at $2B

Appendix

NYSE: NAV

33

NYSE: NAV

34

Impact of Ford Settlement on 2009

Business

Impact

of

Settlement

•

Loss of U.S. automotive customer

•

Less intensive capital/product requirements

•

Restructured business

•

Impact of increased equity stake in BDT & BDP

Settlement and Related Restructuring - 2009 PBT Impact

(in millions)

Q1

Q2

Q3

Q4

Full Year

Cash

200

$          

200

$          

Warranty

75

75

Restructuring charges

(58)

3

-

(4)

(59)

Other related income and (expense)

(27)

(35)

18

(12)

(56)

190

$          

(32)

$           

18

$            

(16)

$        

160

$          

Actual

NYSE: NAV

35

35

Market Share –

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

Navistar

1st Q

2nd Q

3rd Q

4th Q

Full Year

1st Q

2nd Q

3rd Q

4th Q

Full Year

1st Q

2nd Q

3rd Q

4th Q

Full Year

Bus (School)

60%

60%

59%

59%

60%

57%

57%

48%

58%

55%

56%

60%

61%

66%

61%

Medium (Class 6-7)

37%

34%

34%

37%

36%

34%

35%

39%

35%

36%

30%

39%

33%

39%

35%

Heavy (LH & RH)

16%

12%

15%

17%

15%

16%

15%

19%

25%

19%

24%

23%

29%

24%

25%

Severe Service

24%

28%

26%

32%

27%

35%

36%

34%

41%

37%

45%

49%

41%

47%

45%

Combined Class 8

18%

17%

19%

22%

19%

23%

23%

25%

30%

25%

31%

33%

33%

32%

32%

Combined Market Share

25%

25%

27%

31%

27%

29%

29%

30%

35%

31%

33%

38%

37%

39%

36%

Navistar

1st Q

2nd Q

3rd Q

4th Q

Full Year

1st Q

2nd Q

3rd Q

4th Q

Full Year

1st Q

2nd Q

3rd Q

4th Q

Full Year

Bus (School)

60%

60%

59%

59%

60%

57%

57%

48%

58%

55%

56%

60%

61%

66%

61%

Medium (Class 6-7)

37%

34%

34%

37%

36%

34%

35%

39%

35%

36%

30%

39%

33%

39%

35%

Heavy (LH & RH)

16%

12%

15%

17%

15%

16%

15%

19%

25%

19%

24%

23%

29%

24%

25%

Severe Service

23%

26%

24%

28%

25%

28%

26%

26%

29%

27%

32%

36%

33%

33%

34%

Combined Class 8

18%

16%

19%

21%

18%

20%

19%

21%

26%

22%

26%

28%

30%

27%

28%

Combined Market Share

25%

25%

27%

31%

26%

27%

27%

28%

32%

29%

30%

35%

35%

36%

34%

Market Share -

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

2007

2008

2007

2008

2009

2009

NYSE: NAV

36

36

Truck Chargeouts

Note:  Information shown below is based on Navistar’s fiscal year

Fiscal Year 2007

1Q07

2Q07

3Q07

4Q07

Full Year 2007

BUS

3,400

4,100

3,200

3,900

14,600

MEDIUM

9,700

6,800

5,600

6,600

28,700

HEAVY

7,000

4,500

2,600

3,300

17,400

SEVERE

3,900

3,300

3,500

3,700

14,400

TOTAL

24,000

18,700

14,900

17,500

75,100

MILITARY (U.S. & Foreign)

600

900

700

1,000

3,200

EXPANSIONARY

9,100

8,700

9,000

8,500

35,300

WORLD WIDE TRUCK

33,700

28,300

24,600

27,000

113,600

Fiscal year 2008

1Q08

2Q08

3Q08

4Q08

Full Year 2008

BUS

3,100

3,300

2,700

4,400

13,500

MEDIUM

3,700

6,300

5,800

4,500

20,300

HEAVY

2,600

3,900

4,500

7,800

18,800

SEVERE

2,400

3,400

3,300

3,700

12,800

TOTAL

11,800

16,900

16,300

20,400

65,400

MILITARY (U.S. & Foreign)

1,600

2,200

2,300

2,600

8,700

EXPANSIONARY

5,900

8,100

8,400

5,700

28,100

WORLD WIDE TRUCK

19,300

27,200

27,000

28,700

102,200

Fiscal year 2009

1Q09

2Q09

3Q09

4Q09

Full Year 2009

BUS

2,700

3,100

3,500

4,500

13,800

MEDIUM

3,200

3,400

2,600

3,800

13,000

HEAVY

6,100

3,200

4,500

5,300

19,100

SEVERE

2,800

2,700

2,800

2,700

11,000

TOTAL

14,800

12,400

13,400

16,300

56,900

MILITARY (U.S. & Foreign)

2,500

2,100

1,200

2,000

7,800

EXPANSIONARY

2,400

1,900

2,400

5,400

12,100

WORLD WIDE TRUCK

19,700

16,400

17,000

23,700

76,800

NYSE: NAV

37

37

World Wide Engine Shipments

Navistar

1st Q

2nd Q

3rd Q

4th Q

Full Year

Ford

60,000

56,200

65,400

53,500

235,100

Other OEM's (All Models)

21,000

26,400

29,100

27,700

104,200

Engine Shipments to Truck Group

23,100

12,100

13,700

16,500

65,400

Total Shipments

104,100

94,700

108,200

97,700

404,700

Navistar

1st Q

2nd Q

3rd Q

4th Q

Full Year

Ford

47,000

55,300

25,200

24,500

152,000

Other OEM's (All Models)

25,900

31,500

34,100

37,100

128,600

Engine Shipments to Truck Group

12,900

15,700

20,000

16,300

64,900

Total Shipments

85,800

102,500

79,300

77,900

345,500

Navistar

1st Q

2nd Q

3rd Q

4th Q

Full Year

Ford

14,100

29,000

26,200

44,300

113,600

Other OEM's (All Models)

22,500

22,200

24,600

29,100

98,400

Engine Shipments to Truck Group

14,300

12,700

12,800

17,500

57,300

Total Shipments

50,900

63,900

63,600

90,900

269,300

2008

2007

2009

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38

38

Order Receipts –

U.S. & Canada

Percentage

2009

2008

Change

Change

18,300

11,900

6,400

54

15,100

19,400

(4,300)

(22)

Class 8 heavy trucks

19,900

22,600

(2,700)

(12)

Class 8 severe service trucks

14,100

23,100

(9,000)

(39)

67,400

77,000

(9,600)

(12)

34,000

45,700

(11,700)

(26)

* Includes 3,000 and 9,600 units for the years ended October 31, 2009 and 2008, respectively, related to U.S. military contracts.

Total "Traditional" Markets*

Order Receipts: U.S. & Canada (Units)

Combined Class 8 (Heavy and Severe Service)

"Traditional" Markets

School buses

Class 6 and 7 medium trucks

Year Ended

October 31,

NYSE: NAV

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39

Manufacturing Cash Flow

($ in millions)

Note:

This

slide

contains

non-GAAP

information,

please

see

the

Reg

G

in

appendix

for

detailed

reconciliation

Beginning Mfg. Cash

1

Balance

10/31/2007

10/31/2008

10/31/2009

October 31, 2006

$1,078

October 31, 2007

$716

October 31, 2008

$775

Approximate Cash Flows:

From Operations

($231)

$404

$514

Dividends from NFC

$400

$25

$0

From Investing / (Cap Ex)

($70)

($216)

($282)

From Financing / (Debt Paydown)

($480)

($133)

$56

Exchange Rate Effect

$19

($21)

$9

Blue Diamond Consolidation

$0

$0

$80

Ending Mfg. Cash

Balance:

October 31, 2007

$716

October 31, 2008

$775

October 31, 2009

2

$1,152

1

Cash = Cash

and Cash Equivalents

2

Includes Ford's portion of Blue Diamond Cash ($13 million)

1

NYSE: NAV

NFC Liquidity Remains Strong

•

NFC had total available undrawn committed funding of more than $700M at 10/31/2009

-

NFC renewed its $650M dealer floor plan financing facility in August, subsequently reduced to $500M in November with the successful execution

of $350M TALF wholesale funding transaction

-

NFC refinanced its bank revolver in December

•

NFC profitability has rebounded in 2009

–

Margins improving

–

Portfolio quality stabilizing for several quarters

–

Interest rates stabilizing

•

NFC access to retail securitization markets improved

–

Over $1.5B in retail notes have been sold and securitized since the subprime issues began to impact the asset securitization market

–

Securitization markets show significant improvement  due to the support of the U.S. government’s TALF program

–

Serviced receivables balances tracking to truck market trough

–

Truck financing is available for quality credits, especially conquest accounts

Retail Notes

Bank Facility

•

$500 million revolving warehouse

(TRIP)

–

Acquired notes sold into TRIP

–

TRIP warehouses, then securitizes

via bank conduits

•

TRIP terms

–

Matures June 2010

On-balance sheet

•

$815M facility

–

Initial funding of retail note

acquisitions

–

Also funds

dealer/customer

open accounts

–

Matures December 2012

On-balance sheet

•

Current situation

–

~$1,054M funding facility

(NFSC)

–

Available $300M

•

NFSC terms

–

Bank conduit portion (VFC)

renewed October 2008

–

Public portions mature

February 2010 and October

2012

Off-balance sheet

40

NYSE: NAV

41

41

Frequently Asked Questions

Q1:

What should we assume for capital expenditures in 2010?

A:

For 2010, excluding our NFC and Dealcor

acquisition of vehicles for leasing, we expect our capital expenditures to be

below

our

normal

$250

million

to

$350

million

range.

We

continue

to

fund

our

strategic

programs.

Q2:

What is in your Dealcor

debt?

A:

Dealcor

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

company owned dealers.

Q3:

How many Dealcor

dealers did you have as of October 31, 2009?

A:

Of

our

282

primary

NAFTA

dealers,

we

have

ownership

interest

in

17

DealCor

dealers

as

of

October 31, 2009.

Q4:

Have you seen any year-over-year steel, precious metals and resin cost increases in 2009?

A:

Generally, we have been able to mitigate the effects of steel and other commodity cost increases from 2007 to 2009

via a combination of design changes, material substitution, resourcing, global sourcing efforts and pricing performance.

In addition, although the terms of supplier contracts and special pricing arrangements can vary, generally a time lag

exists

between

when

our

suppliers

incur

increased

costs

and

when

these

costs

are

passed

on

to

us

as

well

as

when

we might recover them through increased pricing. This time lag can span several quarters or years, depending on the

specific situation. More recent trends indicate the cost pressures from the majority of our steel and commodity inputs

have not only ceased, but reversed somewhat. However, we have experienced some commodity price increases

versus the overall industry decline as our prior actions to avoid the significant price increases have resulted in

temporarily having slightly higher costs than the industry. The impact of increases related to steel, precious metals,

resins

and

petroleum

products

totaled

approximately

$23

million,

$97

million

and

$86

million,

for

2009,

2008

and

2007,

respectively, as compared to the corresponding prior year.

NYSE: NAV

42

42

Frequently Asked Questions

Q5:

What do you finance at Navistar Finance Corporation (NFC)?

A:

NFC is a commercial financing organization that provides wholesale, retail and lease financing for

sales of new and used trucks and buses sold by the company. NFC also finances the company’s

wholesale accounts and selected retail accounts receivable. Sales of new truck related equipment

(including trailers) of other manufacturers are also financed.

Q6:

What percentage of truck purchases do you fund?

A:

We consistently fund about 95% of floor plan inventory for our dealers in the U.S. and approximately

9% of retail purchases.

Q7:

When is the next refinancing due at NFC?

A:

Our TRIP facility, which we use as a warehouse for our retail notes, is due for renewal in June 2010.

Q8:

Why did you amend the intercompany agreement?

A:

We amended the intercompany agreement to allow more flexibility to NFC and Navistar by allowing

NFC to purchase short-term trade receivables that were previously not included in the agreement or

that the TRAC deal did not permit NFC to purchase.

Q9:

How do you fund retail notes?

A:

Retail notes are primarily funded by a bank revolver and a revolving warehouse facility that we call

TRIP,

which

doesn’t

mature

until

2010.

These

notes

are

ultimately

sold

to

either

a

conduit

facility or into

a public securitization.

NYSE: NAV

43

43

Frequently Asked Questions

Q10:

Are there any requirements for NFC leverage?

A:

NFC is compliant with our revolver leverage covenant of 6 to 1. This ratio calculation excludes qualified

retail and lease securitization debt.

Q11:

How are your securitization rates determined?

A:

Portfolio performance, deal structure and market conditions affect pricing, as well as the type of asset

being

financed

(for

example

dealer

floor

plan

inventory

versus

a

customer

purchase).

Q12:

What is your funding strategy?

A:

We use three or four primary funding sources.

For longer-term retail truck notes that finance the sale of

trucks to end customers, we finance those in the term securitization markets in either public or private

deals. We primarily finance our wholesale portfolio in traditional private or public securitizations. We

also have a combination of revolving type facilities that often warehouse assets until they can be

financed permanently.

Q13:

How is your NFC portfolio performing?

A:

The portfolio is performing as we would expect given the industry downturn and consistent with prior

cycles.

The provision for credit losses increased from approximately $20 million in FY07 to $32 million

in FY08.

During FY09, our provision for credit losses dropped to $30 million.

Q14:

How are your repossessions trending?

A:

Repossessions

were

slowing

down

at

the

end

of

FY08,

and

our

rate

of

repossession

has

declined

throughout FY09.

NYSE: NAV

44

44

Frequently Asked Questions

Q15:

How are your dealers doing?

A:

We think our dealers, which have always been one of our strengths, are well positioned. We

traditionally have not had any significant dealer losses and expect that trend to continue in the future.

Q16:

Are your customer interest rates going to increase?

A:

Like all lenders, we need to achieve a profitability threshold to ensure our continued access to capital,

and that means pricing our rates in line with the marketplace.

So, yes, as the cost of financing has

increased for all companies, we have passed on some of the cost increase to our dealers and

customers.

Q17:

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

A:

Generally, our rates vary (those with higher credit risk have always had to pay higher interest rates)

and are usually in line with the market.

Q18:

How

do

you

make

your

credit

decisions?

Do

you

require

a

certain

credit

score?

A:

We factor in a variety of criteria in our credit scoring model such as business model, company history,

down payment, etc.

Q19:

What is your total amount of capacity at NFC?

A:

Total availability in our funding facilities is more than $700M as of October 31, 2009.

Q20:

Are you able to take advantage of any TALF or TARP money?

A:

Yes, the $350 million transaction we completed in November to support our dealer inventory financing

is eligible for funding under the TALF program.

NYSE: NAV

45

45

Frequently Asked Questions

Q21:

How does your NFC derivative expense compare to last year?

A:

Our derivative expense for FY 2009 was $40.6 million, which compares favorably to our derivative

expense of $55.0 million in FY 2008.

Q22:

How

do

your

repossession

percentages

compare

to

the

overall

size

of

your

portfolios? 

A:

Repossessions

as

a

percent

of

retail

balances

were

approximately

3.6% for FY09 and 4.5% for FY08.

Q23:

What is the current JLTV status?

A:

Navistar and BAE just completed the Critical Design Review (CDR). The CDR was completed as part

of the 27-month JLTV Technology Development (TD) contract received in October 2008. The CDR

marks the completion of the design process and the start of vehicle integration, assembly, test and

checkout (IAT&C) activities to deliver test vehicles to the government by May 2010. Australia and India

have also joined the program and interest has been expressed by Canada, Israel and Britain.

Q24:

What changes have occurred in Defense spending due to the increase in troops heading to

Afghanistan?

A:

According to a Pentagon reprogramming document signed on December 1, the Defense Department is

shifting $2.7 billion from the Mine Resistant Ambush Protected vehicle fund. Approximately $1.8 billion

will go to the MRAP account for government furnished equipment, engineering change proposals, and

initial logistics support for operating forces in Afghanistan.

NYSE: NAV

46

46

Frequently Asked Questions

Q25:

What is the process now that the Government Accountability Office (GAO) has upheld the FMTV

protests waged by Navistar and BAE?

A:

The GAO has recommended that the Army re-evaluate Oshkosh under the capability factor and

Navistar

under

the

past

performance

factor.

The

Army

has

60

days

to

comply with the GAO’s

recommendations.

Price and capability are of equal importance in evaluating the FMTV program. Past

performance is the third area for evaluation.

Q26:

What are the 2010 emissions requirements?

A:

The

rules

allow

manufacturers

to

go

to

0.5

NOx

if

they

clean

up

the

environment

earlier

with

advanced

technology;

manufacturers

need

to

be

at

0.2

NOx

if

they

choose

not

to

introduce

advanced

technologies

earlier. 

Q27:

How has The American Recovery and Reinvestment Act of 2009 and The Worker,

Homeownership, and

Business

Assistance Act of 2009 affected Navistar?

A:

Two of the business tax incentives have a direct effect on Navistar:

A)  The legislation provides for additional depreciation deductions equal to 50% of the cost of non-real

property fixed assets placed in service during calendar year 2009. 

B)   In lieu of claiming the additional depreciation deductions described in (A) above, the legislation would

allow Navistar to accelerate the realization of tax credits earned in prior years. 

Navistar intends to accelerate the realization of tax credits earned in prior years.  The amount expected to

be realized is immaterial to the Company’s financial statements.

NYSE: NAV

47

47

Frequently Asked Questions

Q28:

How will President Obama’s recent tax proposals impact Navistar, if enacted?

A:

The President’s proposals will have anti-competitive implications for multinational companies, such as

Navistar. In the near term we would not anticipate a material adverse impact on our financial

statements due to the fact that we currently have a full valuation allowance against a large portion of

our deferred tax assets and are still utilizing U.S. net operating losses.   Over the long term we would

anticipate adverse U.S. tax implications for our international businesses, requiring actions to be taken

by Navistar to address these implications.

Certain

material

proposals

impacting

multinational

corporations

include:

•Deferral of deductions deemed related to unremitted foreign earnings

•Limitations on the use of disregarded entities in foreign jurisdictions

•Limitations on foreign tax credits

Q29:

What makes up our consolidated tax expense?

A:

Our pre-tax operating profit reflects our worldwide operations, consequently our tax expense reflects

the impact of differing tax positions throughout the world. In general, we currently have a full valuation

allowance against our U.S. and Canadian operations.  Consequently, our tax expense in those

jurisdictions is generally limited to current state taxes and alternative minimum taxes.  Our Brazilian and

Mexican operations are profitable and as a result we accrue taxes in those jurisdictions.  The

confluence

of

events

causes

our

overall

effective

tax

rate

to

be

fairly

low.

NYSE: NAV

48

48

Frequently Asked Questions

Q30:

Your

tax

footnote

in

the

10K

discloses

gross

deferred

tax

assets

of

$2.2

billion.

How

will

those assets be used to offset future taxable income?

A:

The

most

commonly

understood

component

of

deferred

tax

assets

is

the

value

of

our

net

operating

losses, which was reported as $268 million as of 10/31/09.  We continue to offset current taxable

income by these net operating losses both in the U.S. for federal and state tax purposes and in

Canada and Brazil.  In addition, we have several other major components of deferred taxes which will

reduce taxable income in the future.  For example, to date the Company has accrued OPEB, pension

and other employee benefit liabilities during prior years.  As those payments are made to employees,

the company will realize a deduction against its future taxable income.

Similarly, the Company has

accrued significant reserves for warranty and product liability obligations.  As payments are made

against those reserves the Company will realize a deduction against its future taxable income.

Q31:

How

much

value

of

net

operating

losses

remains,

and

why

is

there

still

a

valuation

allowance

against deferred tax assets?

A:

The Company has approximately $288 million of U.S. federal net operating losses available to offset

future

taxable

income.

Applying

a

federal

tax

rate

of

35%,

these

losses

have

a

value

of

$101

million.

In

addition

the

value

of

our

state

and

foreign

NOLs

are

$82

and

$102,

respectively,

for

a

total

value

of

$285. (U.S. GAAP rules require an adjustment to these balances for stock option accounting.)

A

substantial

portion

of

these

NOLs

are

subject

to

a

valuation

allowance.

In

addition

to

these

deferred

tax assets we have other deferred tax assets subject to a valuation allowance of $1,830, for a total 

balance of deferred tax assets subject to a valuation allowance of $2,050. Under U.S. GAAP rules,

when the Company is able to demonstrate sufficient earnings (both historically and in the future) to

absorb these future deductions, the Company is able to release these valuation allowances.

NYSE: NAV

49

49

Frequently Asked Questions

Q32:

What is your expected 2010 pension and OPEB GAAP expense?

A:

We anticipate 2010 pension and OPEB GAAP expense of $185 million.  In 2009, pension and OPEB

GAAP expense was $233 million.

Q33:

What are your expected 2010 and beyond pension funding requirements?

A:

Current forecasts indicate that we may need to contribute approximately $153 million in 2010; from

2011 through 2013 the company will be required to contribute at least $275 million per year to the

plans depending on asset performance and discount rates in the next several years.

NYSE: NAV

50

50

SEC Regulation G

This presentation

is

not

in

accordance

with,

or

an

alternative

for,

U.S.

generally

accepted

accounting

principles

(GAAP).

The

non-GAAP

financial

information

presented

herein

should

be

considered

supplemental

to,

and

not

as a

substitute for,

or

superior

to,

financial

measures

calculated

in

accordance

with

GAAP.

However,

we

believe

that

non-GAAP

reporting,

giving

effect

to

the

adjustments

shown

in

the

reconciliation

above,

provides

meaningful

information and

therefore

we

use

it

to

supplement

our

GAAP

reporting

by

identifying

items

that

may

not

be

related

to

the

core

manufacturing

business.

Management

often

uses

this

information

to

assess

and

measure the

performance of

our

operating

segments.

We

have

chosen

to

provide

this

supplemental

information

to

investors,

analysts

and

other

interested

parties

to

enable

them

to

perform

additional

analyses

of

operating

results,

to

illustrate

the results of operations giving effect to the non-GAAP adjustments shown in the above reconciliations and to provide an additional measure of performance.

DEBT

YE 2006

YE 2007

YE 2008

YE 2009

(in millions)

Manufacturing operations

Facilities due 2012

-

$            

1,330

$     

1,330

$      

-

$                  

8.25% Senior Notes, due 2021, net of unamortized discount of $37

million at October 31, 2009

-

-

-

963

3.0% Senior Subordinated Convertibel

Notes, due 2014

-

-

-

570

Debt of majority owned dealership

484

267

157

148

Financing arrangements and capital lease obligations 

401

369

306

271

7.5% Senior Notes, due 2011

15

15

15

15

9.95% Senior Notes, due 2011

11

8

6

4

Bridge Loan Facility (Libor + 500)

1,500

-

-

-

4.75% Subordinated Exchangeable Notes, due 2009

1

1

1

-

Other

60

39

19

4

Total manufacturing operations debt

2,472

2,029

1,834

1,975

Financial services operations  

Asset-backed debt issued by consolidated SPEs, at variable rates, due serially through 2016

3,104

$     

2,748

$     

2,076

$      

1,227

$          

Bank revolvers, at fixed and variable rates, due dates from 2010

through 2015

1,426

1,354

1,370

1,518

Revolving retail warehouse facility, at variable rates, due 2010

500

500

500

500

Commercial Paper, at variable rates, due serially through 2010

28

117

162

52

Borrowing secured by operating and finance leases, at various rate, due serially through 2016

116

133

132

134

Total financial services operations debt

5,174

$     

4,852

$     

4,240

$      

3,431

$          

Cash & Cash Equivalents

YE 2006

YE 2007

YE 2008

YE 2009

Manufacturing non-GAAP (Unaudited)

1,078

$     

716

$        

775

$         

1,152

$          

*

Financial Services non-GAAP (Unaudited)

79

61

86

60

Consolidated US GAAP (Audited)

1,157

$     

777

$        

861

$         

1,212

$          

Manufacturing Cash & Cash Equivalents non-GAAP (Unaudited)

1,078

$     

716

$        

775

$         

1,152

$          

*

Manufacturing Marketable Securities non-GAAP (Unaudited)

136

6

2

-

Manufacturing Cash, Cash Equivalents & Marketable Securities non-GAAP (Unaudited)

1,214

$     

722

$        

777

$         

1,152

$          

*Includes increase in cash and cash equivalents from consolidating Blue Diamond Truck and Blue Diamond Parts

Audited

NYSE: NAV

51

51

SEC Regulation G –

Quarterly Comparison

2009 Q4

2008 Q4

Non GAAP

Non GAAP

As Reported

Non GAAP

Non GAAP

As Reported

Without

Impacts

Impacts

With Impacts

Without

Impacts

Impacts

With Impacts

U.S. and Canada Industry

44,400

63,100

($billions)

Sales and revenues, net

3.3

$            

3.9

$            

($millions)

Manufacturing segment profit *

(excluding items listed below)

279

$           

-

$           

279

$           

217

$           

-

$           

217

$           

Ford settlement net of related charges

(16)

(16)

(27)

(27)

Impairment of property, plant and equipment

(31)

(31)

(358)

(358)

Manufacturing segment profit

279

(47)

232

217

(385)

(168)

Below the line items

(excluding items listed below)

(130)

-

(130)

(137)

(137)

Write-off of debt issuance cost

(11)

(11)

-

Below the line items

(130)

(11)

(141)

(137)

-

(137)

Income (loss) excluding income tax

149

(58)

91

80

(385)

(305)

Income tax benefit (expense)

(5)

-

(5)

(39)

1

(38)

Net Income (loss)

144

$           

(58)

$           

86

$             

41

$             

(384)

$         

(343)

$         

diluted

Diluted earnings (loss) per share ($'s)

1.99

$          

(0.80)

$        

1.19

$          

0.56

$          

(5.37)

$        

(4.81)

$        

Weighted average shares outstanding: diluted (millions)

72.3

72.3

73.0

71.4

basic

* Includes: minority interest in net income of subsidiaries net of tax; extraordinary gain net of tax

0.57

$          

(5.38)

$        

(4.81)

$        

71.4

71.4

This presentation is not in accordance with, or an alternative for, U.S. generally accepted accounting principles (GAAP). The non-GAAP financial information presented herein should be considered supplemental to, and not

as a substitute for, or superior to, financial measures calculated in accordance with GAAP.  However, we believe that non-GAAP reporting, giving effect to the adjustments shown in the reconciliation above, provides

meaningful information and therefore we use it to supplement our GAAP reporting by identifying items that may not be related to the core manufacturing business.  Management often uses this information to assess and

measure the performance of our operating segments. We have chosen to provide this supplemental information to investors, analysts and other interested parties to enable them to perform additional analyses of operating

results, to illustrate the results of operations giving effect to the non-GAAP adjustments shown in the above reconciliations and to provide an additional measure of performance.

NYSE: NAV

52

52

SEC Regulation G –

Fiscal Year Comparison

2009

2008

Non GAAP

Non GAAP

As Reported

Non GAAP

Non GAAP

As Reported

Without

Impacts

Impacts

With Impacts

Without

Impacts

Impacts

With Impacts

U.S. and Canada Industry

181,800

244,100

($billions)

Sales and revenues, net

11.6

$          

14.7

$          

($millions)

Manufacturing segment profit *

(excluding items listed below)

707

$           

-

$           

707

$           

1,088

$        

-

$           

1,088

$        

Ford settlement net of related charges

160

160

(37)

(37)

Impairment of property, plant and equipment

(31)

(31)

(358)

(358)

Manufacturing segment profit

707

129

836

1,088

(395)

693

Below the line items

(excluding items listed below)

(468)

(468)

(502)

(502)

Write-off of debt issuance cost

(11)

(11)

-

Below the line items

(468)

(11)

(479)

(502)

-

(502)

Income (loss) excluding income tax

239

118

357

586

(395)

191

Income tax benefit (expense)

(34)

(3)

(37)

(58)

1

(57)

Net Income (loss)

205

$           

115

$           

320

$           

528

$           

(394)

$         

134

$           

Diluted earnings (loss) per share ($'s)

2.86

$          

1.60

$          

4.46

$          

7.21

$          

(5.39)

$        

1.82

$          

Weighted average shares outstanding: diluted (millions)

71.8

71.8

73.2

73.2

* Includes: minority interest in net income of subsidiaries net of tax; extraordinary gain net of tax

This presentation is not in accordance with, or an alternative for, U.S. generally accepted accounting principles (GAAP). The non-GAAP financial information presented herein should be considered supplemental to, and

not as a substitute for, or superior to, financial measures calculated in accordance with GAAP.  However, we believe that non-GAAP reporting, giving effect to the adjustments shown in the reconciliation above, provides

meaningful information and therefore we use it to supplement our GAAP reporting by identifying items that may not be related to the core manufacturing business.  Management often uses this information to assess and

measure the performance of our operating segments. We have chosen to provide this supplemental information to investors, analysts and other interested parties to enable them to perform additional analyses of

operating results, to illustrate the results of operations giving effect to the non-GAAP adjustments shown in the above reconciliations and to provide an additional measure of performance.