New Flyer Industries TSX: NFI and NFI.DB.U

North America’s #1 Transit Bus Manufacturer and Parts Supplier

Forward Looking Statements: May contain forward-looking statements relating to New Flyer Industries Inc. and related companies or to the environment in which they operate, which are based on their operations, estimates, forecasts and projections. These statements are not guarantees of future performance and involve risks and uncertainties that are difficult to predict, or are beyond New Flyer’s control. A number of important factors could cause actual outcomes and results to differ materially from those expressed in these forward-looking statements. These factors include those set forth in New Flyer’s Annual Information Form which is available on SEDAR at www.sedar.com. New Flyer assumes no obligation to update or revise any forward-looking statements to reflect new events or circumstances, except as required by applicable securities laws. All figures are in U.S. dollars unless otherwise noted.

Non-GAAP Measures: For the definition and explanation of EBITDA, ADJUSTED EBITDA and FREE CASH FLOW please refer to Appendix A.

January 14, 2015

Executive Summary New Flyer Investment Highlights

. Largest Installed base. Approximately 80,000 heavy-duty transit buses in operation of which over 50% are Leading North New Flyer, NABI or Orion American Market . Approximately 50% heavy-duty bus market share in 2013 based on deliveries (equivalent units) Share . Approximately 34% aftermarkets parts market share based on 2013 sales with the next closest competitor having less than a 10% market share Deep Relationships . Established relationships with well over 300 North American transit authorities operating approximately 75% with High Quality of heavy-duty transit buses in the U.S. and Canada Customer Base . 24 out of 25 largest transit agencies operate New Flyer, NABI or Orion buses Leadership in Product . Market leader in propulsion options including: clean diesel, natural gas, electric trolley, diesel-electric hybrid Offering and and battery-electric Technology . Leading in-house engineering and New Product Development capabilities . Long established track record with various transit authorities and manufacturing supply chain Well Positioned . Integrated aftermarket parts and services operation supporting over 50% of in-service heavy-duty transit Against Competitors buses in the U.S. and Canada . Compliance with Buy-American legislation and provincial policies regarding Canadian content . Complete full integration of NABI into New Flyer providing overhead and supply synergies Multi-Faceted Growth . Growth of “clean technology” aligned with New Flyer product offering and engineering capabilities Strategy . Robust pipeline of acquisition and joint venture opportunities to diversify product offerings and geographic footprint

Experienced . Deep industry experience and track record of positioning business for growth and increased profitability Executive Team . Proven ability to complete and integrate strategic acquisitions

. Strong and predictable free cash flow generation supported by attractive EBITDA margin and high cash Strong Free Cash conversion ratio Flow Generation . Low operating leverage with fixed costs representing approximately 10% of total bus manufacturing cost structure

January 14, 2015 Source: Company filings, management estimates

3 Strategically executed transformation NFI positioned for Sustainability, Diversification and Growth

2011-12: NFI converted from IDS(1) to a Common Share structure

19.99% equity Announced plan to Convertible debt investment by world’s rationalize NABI to Production Launch of issued and terminated #2 bus manufacturer build New Flyer ® ® new Xcelsior HD remaining IDSs Xcelsior platform transit bus platform Brazilian based, delivers over 33,000 buses annually Launched battery- electric bus

2010 2011 2012 2013 2014

Acquired U.S. parts Announced MiDi® JV Acquired Acquired U.S. fabrication business with Alexander Dennis Canadian and transit bus and U.S. based fabricator and Limited U.S. parts parts business supplier of interior ADL is UK’s largest bus and business North America’s #4 lighting and stanchions coach builder and a North America’s #4 bus OEM & #2 world leader in double deck bus aftermarket aftermarket parts and mid-sized bus parts business business

Recent activities position New Flyer to capitalize on opportunities going forward

Source: Company filings January 14, 2015 1. New Flyer IPO’d in 2005 on the TSX as an Income Deposit Security (IDS).

4 Executive Summary Bus Manufacturing Overview

Highlights & Competitive Advantage Estimated Market Share

. Founded in 1930. Exclusively focused on transit bus manufacturing since 1971 2013 Heavy-Duty Transit Bus Deliveries(1) Long History . First manufacturer to introduce the low floor bus Other platform in North America which has become the 6% industry standard 13% Premier . Active relationships with over 300 transit authorities in Customer North America, that collectively, operate New Flyer Base approximately 75% of the heavy-duty bus fleet(1) 43% 50% . Over the last 5 years, over two-thirds of bus revenue derived from repeat customers Repeat 31% . Customers are increasingly looking to simplify NABI Business 7% operations by reducing the number of platforms for new bus purchases and aftermarket support . Broadest and most advanced product offering in the Installed Fleet: U.S. and CAN Bus Fleet(2) Broadest combined U.S. and CAN heavy-duty transit buses Other Product 21% Offering . In-house capabilities to bid on virtually any heavy- duty transit order in North America New Flyer 29% Exceeding . Supply chain setup to exceed all material content Content legislated by U.S. and CAN provincial governments 8% Requirements NABI 52% . Introduced the 60' articulated bus to North American 10% Orion Leader in market in 1996 Product 13% Innovation . Broadest propulsion options in industry: diesel, 19% hybrid, CNG, trolley, fuel cell and battery-electric

Source: Company filings, management estimates January 14, 2015 1. 2013 market share based on delivered EU in U.S. and Canada. 2. December 2014 Company estimate. 5 Company Overview Current Bus Models

New Flyer Xcelsior® New Flyer MiDi® NABI BRT & LFW(1)

LFW

BRT

 Production launch in 2009 based  Joint venture with ADL to bring  31’ and 40’ (LFW) and 42’ and 60’ on over 20 years experienced with MiDi® to North American market (BRT) buses

low floor bus design  Production launch in 2014  Propulsion using clean diesel,

 35’, 40’, and 60’ bus  30’ and 35’ low-floor bus hybrid, or natural gas

 12-year, 500,000 miles estimated  12-year, 500,000 miles estimated  Estimated installed fleet: 10,000 life life  LFW & BRT to be phased out in

 Multiple propulsion systems  Clean diesel propulsion and 2015 and replaced by NFI options: diesel, hybrid, natural gas, currently investigating CNG and Xcelsior® platform trolley and battery-electric electric

 Targets metropolitan and urban  Targets municipal and commercial markets shuttle markets

 Typical sale price of approx  Typical sale price approx $300,000 $450,000 for 35/40’ and $700,000 for 60’ articulated bus

January 14, 2015

6 Company Overview Market Leadership in Technology and Propulsion Options

Battery-Electric Single platform - multiple propulsion options

Hybrid-Electric

Natural Gas

Electric-Trolley

New Flyer’s battery-electric Xcelsior® Clean Diesel .Pilot bus testing complete and in service. .2 electric buses delivered to Chicago in Q2-14 .4 buses delivered to Winnipeg in Q4-14 .Electric 60’ artic in development

Focused on New Flyer’s optimized and robust Xcelsior® platform

January 14, 2015

Leading Market Share for both HD Transit Bus & Parts

Heavy-Duty Transit Bus Share Aftermarket Parts Share based on EUs delivered in 2013 based on estimated parts sales in 2013

Other (incl. El Dorado,and Proterra),

MCI/UCP 4% ABC Companies 6% Prevost/Nova Neopart 6% 3% Mohawk 2% Other Transit Brokers 3% Gillig 9% 6% Bus Service/Maintenance Facilities 9% 4%

NABI 4% * Engine & Transmission Part 4% Vendors 8%

Local Suppliers 9% 28%

New Flyer 1% 28% Truck/Common Parts Suppliers 8%

Bus Component Vendors Orion Direct 1% ** 5%

NF BUS NF PARTS Pro Forma Pro Forma Share ~50% Share ~34%

Note: NABI and Orion market shares reflect share prior to NF acquisition in 2013. Source: 2013 New Flyer Database & Management Estimates

January 14, 2015

North American Transit Bus fleet estimated >80,000 buses

Market Segments 24 of NA’s 25 largest Transit Agencies and primary targets operate NF and/or NABI buses

Metropolitan Urban Municipal Fleets Fleets Fleets 17 operators 200 operators 900+ Operators 39% of 45% of 16% of installed fleet installed fleet installed fleet

Primary Target market

New entrants focusing on battery-electric buses:

52% of the installed HD Transit Bus fleet are New Flyer, NABI or Orion buses

Source: 2013 New Flyer Database & Management Estimates January 14, 2015

9 Company Overview New Flyer Bus and Aftermarket Locations

3,300 team members with approx 1,300 covered by CBA Parts Distribution Winnipeg, MB Winnipeg CBA expires Mar 15/15 Headquarters Manufacturing & Service NFI Parts Fabrication and Bus Assembly New Product Development Crookston CBA expires Dec 31/15 NFI Parts Distribution Center St Cloud CBA expires Mar 31/17 BC PE Arnprior, ON AB Service Center SK MB QC NB ON NS WA ME

MT ND VT Brampton, ON MN NH MA NFI Parts Distribution Center OR NY ID RI SD WI MI CT WY PA Fresno, CA ` NJ DE Elkhart, IN NFI Parts Distribution Center IA TCB Part Fabrication NV NE MD IN OH IL WV UT VA DC CA CO KS MO KY NC TN Delaware, OH SC AZ OK NABI Parts Distribution Center NM AR GA Los Angeles, CA AL MS Service Center Hebron, KY NFI Parts Distribution Center TX LA

Anniston, AL Crookston, MN St Cloud, MN NABI Bus Assembly NFI Bus Assembly NFI Bus Assembly

Strategically located to provide best-in-class support and response times

Source: Company filings January 14, 2015

Significant improvement in Operations

Key Operational Improvements since 2010:

. Build in Station (by task) improved from 87% to 95% . Average Labour Efficiency increased from 71% to 89% . Days in Customer Acceptance reduced from 21 to 16 days

Focused investment on both cultural and physical change

January 14, 2015

11 The Industry’s most Comprehensive Parts and Support Services

The complexity of bus technology combined with constrained operating budgets for many transit authorities have made aftermarket parts and support services increasingly important to transit authorities’ new bus purchase decisions

Aftermarket Parts Product Support Services

 NFI with addition of Orion Parts and NABI Parts is the  Publications: Wide range of customized parts, maintenance recognized leader in both size and quality of service with an and operational documentation. New Flyer publications remain estimated market share of 34% in 2013. the industry standard.

 Key competitive advantages include: widest product  Service Support: Product acceptance, field support, field assortment and industry leading distribution network with engineering and warranty management

shortest delivery times.  Product Training: Operator and maintenance training  Distributes parts for products manufactured by New Flyer, provided in connection with new bus sales or aftermarket NABI, Orion, as well as other bus manufacturers support

 Exclusive product distribution:  eLearning: On-line hosted training and training record management . NFI proprietary line of service parts under the “Kinetik” brand  New Flyer Connect : On-board system that permits real-time . Exclusive license for Xtended LifeTM products which longer monitoring of the bus driver and vehicle performance to help lives that reduce vehicle operating/maintenance costs improve driver safety, driving efficiency and fuel and maintenance costs

Well positioned to maximize market share of life cycle support services

January 14, 2015

Market Economic Fundamentals Stabilizing

US Fed Funding vs Industry Deliveries US Quarterly State Tax Colle ctions [YOY % Chg]

ISTEA TEA-21 SAFETEA-LU Extension to SAFETA-LU MAP-21 ARRA DRRA Bus Deliveries (EU) 25000 7000 12

6000 10 20000

5000 8

15000 4000 6

3000

10000 4 US Federal US Funding ($ millions) 2000 2

5000 Change % Same vs Last Year 1000 0

0 0 -2

2014 Q1 2014 Q2 2014 Q3 2014

2011 Q2 Q2 2011 Q3 2011 Q4 2011 2011 Q1 2011

2012 Q1 Q1 2012 Q2 2012 Q3 2012 Q4 2012 Q1 2013 Q2 2013 Q3 2013 Q4 2013 2010 Q3 Q3 2010 Q4 2010

Source: http://www.fta.dot.gov & management estimates State Tax Revenue YoY Change Source: The Nelson A. Rockefeller Institute State Revenue Reports

Average Age of of Transit Buses [years] QQtrly Transit Ridership % Chg YOY

Canada USA 8.00% 12 6.00% 11 4.00%

10 2.00%

9 0.00%

2009 Q1 2009 Q2 2009 Q1 2010 Q2 2010 Q3 2010 Q4 2013 Q1 2011 Q4 2011 Q1 2012 Q2 2012 Q3 2012 Q4 2012 Q4 2013 Q1 2014 Q2 2014 Q3 2014 2009 Q4 2009 Q2 2011 Q3 2011 Q1 2013 Q2 2013 -2.00% Q3 2009 8 Q3 2013

-4.00% 7 -6.00% US Bus Total US Total All Modes CDN Total All Modes 6 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

Source: CUTA, APTA http://www.apta.com/resources/statistics/Documents/FactBook/2013-Fact- Source: http://www.apta.com/resources/statistics/Pages/ridershipreport.aspx Book-Appendix-A.pdf January 14, 2015

Strong Bid Universe and Active Opportunities

7000 EUs delivered in Can/US has flattened out NFI Book-to-Bill >100% last 7 our of 8 quarters 7000 350% 6236 6032 5933 6000 5816

5347 5388 5255 6000 300% 5212 5284 5154 5109 5009 5065 5083 5000 4797 4723 5000 250% 4333 4047 4000 4000 200%

3000 3000 150%

2000 2000 100%

2437 2164 2257 2191 1000 2051 1938 2003 2023 1864 1731 1811 1000 50% 1500 1583 1656 1272 1442 935 1050

0 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 0 0% Estimated

Actual Deliveries - Total Market New Flyer Deliveries

Q3 2009Q3 2009Q4 2010Q1 2010Q2 2010Q3 2010Q4 2011Q1 2011Q2 2011Q3 2011Q4 2012Q1 2012Q2 2012Q3 Q1 2008Q1 2008Q2 2008Q3 2008Q4 2009Q1 2009Q2 2012Q4 2013Q1 2013Q2 2013Q3 2013Q4 2014Q1 2014Q2 2014Q3 2014Q4

LTM New Orders (EU) LTM Deliveries (EU) LTM Order Intake/Deliveries

Healthy NFI Bid Universe and Active Opportunities NFI backlog recovered in 2013-14 Heavy Duty Bid Universe 10000

25,000 9000

8000

20,000 7000

6000 15,000 5000

10,000 4000

3000

5,000 2000

1000 -

09 10 13 14 11 12

09 10 11 13 14 12

09 10 12 13 14 11

09 12 13 14 10 11

11 12 13 09 10 14

12 13 09 10 11 14

09 09 10 10 10 11 11 11 13 14 14 09 12 12 12 13 13 14

09 10 10 11 11 14 14 09 12 12 13 13

09 12 13 10 11 14

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07 07 08 08 09 10 11 11 12 12 13 13 14 06 07 07 08 08 09 09 09 10 10 10 11 11 12 12 13 13 14 14 14

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Jul Jul Jul Jul Jul Jul

Q2 Q3 Q3 Q4 Q4 Q1 Q1 Q2 Q2 Q3 Q3 Q4 Q4 Q4 Q1 Q4 Q1 Q2 Q1 Q2 Q3 Q2 Q3 Q4 Q3 Q4 Q1 Q4 Q1 Q2 Q1 Q2 Q3

Jan Jan Jan Jan Jan Jan

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Jun Jun Jun Jun Jun Jun

Oct Oct Oct Oct Oct Oct

Apr Apr Apr Apr Apr Apr

Feb Sep Feb Sep Feb Sep Feb Feb Sep Feb Sep Sep

Dec Dec Dec Dec Dec Dec

Aug Aug Aug Aug Aug Aug

Nov Nov Nov Nov Nov Nov

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Mar Mar Mar Mar Mar Mar

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May May May May May May

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12 12 12 12 12 12

12 12 12 12 12 12 12 12 12 12 12 12

12 12 12 12 12 12

12 12 12 12 12 12 Firm CTA Firm Option CTA Option

Note: CTA deferred order was removed in Dec 2013 following 5 years of inaction. January 14, 2015 Ongoing Bids Submitted Bids Forecast

Average Weekly Line Entry & Delivery Rates (EUs)

2010 2011 2012 2013 2014

55 52 52 50 50 48 49 48 47 46 46 46 44 44 45 40 42 41 39 39 39 38 38 36 3637 36 36 35 35 34 34 3435 33 32 33 33 30 29 30

1 2 1 0 0 10 1 1 1 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Heavy Duty Line Entry Heavy Duty Delivery MiDi Line Entry MiDi Delivery

Includes activity from NABI Bus LLC following acquisition by New Flyer in June 2013. New Flyer MiDi® commenced production in Jan 2014.

Average 2014 Line Entry rate (EUs per production week): Heavy-Duty = 50, MiDi ® = 1.25

January 14, 2015

NFI Financial Performance

Sales ($M US) Adj EBITDA ($M US) Free Cash Flow/Share ($CAD)

1600 120 1.20 1.0831 1400 100 1.00 304 1200 0.8682 215 48 80 0.80 1000 31 24 0.6102 116 0.5592 800 119 60 0.60 20 600 1,109 984 40 0.40 400 800 64 746 57 62 20 41 0.20 200

0 0 0.00 2011 2012 2013 Q3-14 LTM 2011 2012 2013 Q3-14 LTM 2011 2012 2013 Q3-14 LTM Bus Parts Bus Parts *Bus Includes Corporate Overhead

Q3-14 LTM Adj EBITDA to Free Cash Flow ($M) Free Cash Flow and Dividends ($M CAD)

70.0

120 109.2 60.1 60.0 100 12.6 Millions 50.0 80 45.1 24.8 60.1 40.0 60 55.4 33.1 30.7 32.4 14.9 1.5 4.7 30.0 26.0 40 27.1 20.0 20 10.0 7.8 - 0.0 2011 2012 2013 Q3-14 LTM Free Cash Flow Dividends

In 2011, NFI completed a noncash rights offering to facilitate conversion from an IDS to a traditional common share structure. Shareholders exercised approximately 89% of the Rights January 14, 2015 issued by tendering approximately C$242.3M principal amount of Subordinated Notes in exchange for approximately 39 million common shares. In 2013, Marcopolo S.A. acquired approximately 11 million newly issued common shares, representing a 19.99% stake in NFI.

Transformed from IDS to Common Share structure Reduced Leverage and Interest Costs. Compliant with all covenants

Total Debt ($US M) $450 4

$400 $65M Convertible Debenture 3.5 issued in Jun-12. Proceeds used to $350 redeem Bach Bonds/IDS Debt in $300 August 2012. Convert price 3 $US10/share $250 $115M Revolver facility used to $200 manage working capital fluctuations 2.5 ($45M outstanding) $150 $100 $142M Senior term loan @ rate of 2 LIBOR plus applicable margin $50 $0 1.5 2010 2011 2012 2013 Q3-14 LTM

IDS Debt Bachelor Bonds Senior Term Loan Revolver Convertible Debenture Total leverage ratio

Interest on Bach Bonds/IDS Debt = 14% vs Converts = 6.25%

Total Leverage Ratio does not include Convertible Debenture as debt. Senior secured credit facility is in place until April 24, 2017.

January 14, 2015

New Flyer Share Performance

NFI (Common Share) NFI.DB.U (Convertible)

NFI added to TSX Small Cap Index in 2013

55.5M Common Shares outstanding. Conversion price $10.00 US Annual dividend C$0.585/share paid monthly (Yield approx 4.4%) Convertibles outstanding approx. $65M @ Face Value Distributions paid for 110 consecutive months (since IPO) Coupon 6.25%. Yield at approx 5.3%

To date $362,000 of Debentures have converted to Common shares

Significant NFI Shareholders (as at Dec 30-14) On and after June 30, 2015 and prior to maturity, the Debentures may be redeemed in whole or in part at the Company’s option, at a price equal to their principal amount . Marcopolo S.A. approx 19.99% (Brazil) plus accrued and unpaid interest, provided that the volume weighted average trading price of the Shares on the TSX for the 20 consecutive trading days preceding the . Franklin Resources approx 9.88% (Canada) date on which the notice of redemption is given is not less than 125% of the . Coliseum Capital Management, LLC approx 11.11% (USA) conversion price. . Mawer Investment Management Limited approx 9.81% (Canada) . NFI Board and Management approx 2.03% (Canada and USA)

January 14, 2015

APPENDIX A

DEFINITIONS OF EBITDA, ADJUSTED EBITDA AND FREE CASH FLOW

References to “EBITDA” are to earnings before interest, income taxes, depreciation and amortization, and unrealized foreign exchange losses or gains on non-current monetary items. References to “Adjusted EBITDA” are to EBITDA after adjusting for: the effects of certain non-recurring and/or non-operations related items that have impacted the business and are not expected to recur, including non-recurring transitional costs relating to business acquisitions, product rationalization costs, impairment loss on equipment and intangible assets, realized investment tax credits (“ITCs”), stock-based compensation and costs associated with assessing strategic and corporate initiatives.

Management believes EBITDA, Adjusted EBITDA and Free Cash Flow (as defined below) are useful measures in evaluating the performance of the Company. “Free Cash Flow” means net cash generated by operating activities adjusted for changes in non-cash working capital items, interest paid, interest expense, income taxes paid, current income tax expense, effect of foreign currency rate on cash, defined benefit funding, non-recurring transitional costs relating to business acquisitions, costs associated with assessing strategic and corporate initiatives, product rationalization costs, defined benefit expense, cash capital expenditures and principal payments on capital leases. However, EBITDA, Adjusted EBITDA and Free Cash Flow are not recognized earnings measures and do not have standardized meanings prescribed by IFRS. Readers of this presentation are cautioned that EBITDA, Adjusted EBITDA and Free Cash Flow should not be construed as an alternative to net earnings or loss determined in accordance with IFRS as an indicator of New Flyer's performance or to cash flows from operating, investing and financing activities as a measure of liquidity and cash flows. A reconciliation of net earnings and cash flow to EBITDA and Adjusted EBITDA, based on the Financial Statements, has been presented In Management’s Discussion and Analysis of Financial Condition under the heading “Reconciliation of Net Earnings to EBITDA and Adjusted EBITDA” and “Reconciliation of Cash Flow to EBITDA and Adjusted EBITDA”, respectively. A reconciliation of Free Cash Flow to cash flows from operations is provided under the heading “Summary of Free Cash Flow”.

New Flyer’s method of calculating EBITDA, Adjusted EBITDA and Free Cash Flow may differ materially from the methods used by other issuers and, accordingly, may not be comparable to similarly titled measures used by other issuers. Dividends paid from Free Cash Flow are not assured, and the actual amount of dividends received by holders of Shares will depend on, among other things, the Company's financial performance, debt covenants and obligations, working capital requirements and future capital requirements, all of which are susceptible to a number of risks, as described in New Flyer’s public filings available on SEDAR at www.sedar.com.

January 14, 2015