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NFI Investor Update

North America’s leading Transit Bus and Motor Manufacturer and Parts Distributor

January 12, 2016

Forward Looking Statements and Non-GAAP Measures are defined in APPENDIX B . 1

NFI Group Company Highlights

Q3-16 LTM Performance:

Revenue: US $2.1 B Adj EBITDA: US $256.9 M Return on Sales: 12.4%

Net Debt: $558 M #1 Transit Bus & Motor Coach manufacturer and parts supplier in Leverage: 2.08 North America with the leading installed base (nearly 70,000 vehicles (Converts treated as Equity) or ~50%). ~5,000 employees in USA & Canada ROIC: 14.1% Shareholders: Marcopolo S.A. = 10.8%, Management/Board = 1.9%. FCF: US $166.9 M Payout Ratio: 21.9% Fully Diluted Market Cap: ~$C 2.5B. Growth and Yield focus.

Current Backlog Common Share (TSX:NFI) Convertible Debt (TSX:NFI.DB.U) Firm : 3,442 EU, $1.8 B Shares Outstanding: 61.8 M Principal Outstanding: US $8.1 M Options : 6,745 EU, $3.5 B 60-day average Daily Volume: ~ 340K 60-day average Daily Volume: ~US $8K LTM Book to-Bill Ratio: 131% Dividend = C$0.95 /share (1) , Yield: ~2.3% (3) Coupon: 6.25%, Yield: ~ 2.1% (3) TSR (2) : 2016 = 47% 2015 = 115%

Dec 18-15: NFI added to S&P/TSX Composite Index Mar 14-16: NFI added to S&P/TSX Equal Weight Industrials Index Mar 11-16: NFI Equity Options commenced trading on Montreal Exchange

(1) Effective May 12, 2016 the Dividend increased from C$0.70 to C$0.95 per share annually. Paid quarterly. (2) Total Shareholder’s Return (“TSR”) is calculated by the growth in capital assuming the dividends are reinvested each time they are paid. (3) Calculated using closing TSX market price as at January 4, 2017 2

+ NFI Investment Thesis

° North Americas’ #1 heavy duty transit bus brand, #1 motor coach brand and #1 aftermarket Leading Share in parts and service supplier Diversified Markets ° Marketing leading installed fleet. >70,000 vehicles (transit buses and motor coaches) currently in service with ~50% share of Canadian and US installed base

° Founded in the 1930’s, NFI and MCI have established relationships with nearly all domestic Deep Relationships transit authorities and specifically 24 out of 25 of the largest agencies operate NFI buses with High Quality Customer Base ° Strong reputation and long standing relationship with hundreds of motor coach operators in Canada and US operating MCI or motor coaches

° Leading in-house engineering and new product development capability Broad ° Offer the industry’s widest range of green propulsion options: diesel, natural gas, electric Product Offering trolley, diesel-electric hybrid, and now battery-electric with Technology Leadership ° Compliant with Buy-America and policies regarding Canadian content ° Integrated aftermarket parts and services operation

Experienced ° Successful track record of positioning the business for growth and increased profitability Team focused on Growth & ° Extensive LEAN transformation and OpEx experience with proven ability to complete Diversification accretive acquisitions and achieve synergies

Strong Financial ° Proven financial performance and low leverage. metrics ° Strong/Predictable cash flow with proven de-levering and consistent dividends paid 3

NFI Group + NFI Business Strategy

Our Facilities, Our Market Our Business Our Revenue, Processes & Leading Positions and Revenue EBITDA and Products in Bus/Coach/Parts Stream CashFlow Optimize, Defend, Diversify & Grow

1. Offer Canadian and US operators the best buses, services and value in the industry ¢ Migrate from selling buses to providing solutions and deliver best value and support for life of our products focusing on lowest Total Cost of Ownership ¢ Provide complete offering: Bus (“Workhorses of the Fleet”) supported by Parts, Service & Valued Added services ¢ Lead the market in innovation, reliability and quality ¢ Excel at customer support, response and follow up with emphasis on aftermarket parts and services

2. Operate as a world class OEM using LEAN principles, a Quality Roadmap and a Safety Culture ¢ Be recognized as an Employer of Choice with an industry leading safety culture ¢ Excel in engineering, supply chain, strategic sourcing and appropriate in-sourcing ¢ Continuous pursuit of eliminating waste and cost reduction to improve competiveness ¢ Operate as a responsible, sustainable and environmentally conscious business

3. Perform while seeking Diversification and Growth ¢ Lead the North American transit bus and and deliver strong TSR ¢ Operate with an appropriate and flexible capital structure to grow the business ¢ Seek to diversify over long term to ensure longevity and sustainability: Product (type of bus) and/or Market (Public vs Private) and/or Geography (North America vs International). 4

NFI Group Strategic Plan and Execution has delivered solid TSR

Total Shareholder Return (1) Cultural & Structural Change

700.0 ° Adopted Stakeholder Model. 657.1 ° Commitment to Culture, People & LEAN operations 600.0 ° Migrated Capital Structure from Income Deposit Security (yield only focus) Common Share (Growth and Yield)

500.0 Strategic Acquisition's

400.0 Investment in NFI ° NFI's first acquisition enhanced part fabrication capability and capacity ° 19.9% equity investment in NFI by a

TotalReturn 300.0 leading global bus and coach body manufacturer

200.0 ° NFI acquired Orion’s parts business from Daimler 146.6 ° NFI acquired US manufacturer of heavy- 100.0 S&P/TSX Composite duty transit buses and parts distributor ° NFI acquired North America’s leading -- manufacturer of motor coach and Aug-12 Aug-13 Aug-14 Aug-15 Aug-16 parts/service support

Source: FactSet, Company filings

1. Total shareholder return includes capital appreciation and dividends paid. 2. Calculated using closing TSX market price as at January 9, 2017 5

NFI Group Business Units with Proven Leadership

Wayne Joseph Ian Smart Brian Dewsnup President Transit Bus President Motor Coach President Aftermarket Parts

Joined in 2008 as VP Operations and then Joined New Flyer in 2011 as EVP Aftermarket and prior to Was NABI’s CFO for 8 years (which NFI acquired in assumed responsibility as EVP Transit Bus. Prior to that that held various executive positions at StandardAero one 2013), and then VP Business Development of New Flyer. Wayne held executive positions in bus manufacturing for of the world’s largest independent aviation service Brian lead the acquisition of MCI and in 2016 became MCI over forty years with NABI, Blue Bird Body Company and companies. VP & GM Aftermarket. Prior to that Brian served as , and at BAE Systems. Controller of Johns Manville's Waterville operations, and Ian was the project leader of the privatization and LEAN held various finance capacities at Wayne holds a Bachelor of Science in Business implementation at a United States Air Force Base in San and Corporation. Administration and an Accounting Degree from Ashland Antonio. University in Ohio. He also has a Certified in Production Brian has an MBA in Finance, a Masters Degree in and Inventory Management (CPIM) designation. Ian has a Bachelor of Science in Industrial Engineering. Mechanical Engineering, and a Bachelor's Degree in Mechanical Engineering. 6

#1 Market Share in Transit Bus

Heavy-Duty: Xcelsior ® Medium-Duty: MiDi ®

® ¢ Launch in 2009 based on >20 years experience with ¢ JV with (UK) to introduce MiDi to low floor transit buses North America in 2014

¢ Offered in 35’, 40’, and 60’ lengths ¢ 30’ and 35’ low-floor medium duty bus, tested to HD

¢ Primary targets is metropolitan & urban fleets standards. Primary target is municipal/ & commercial shuttles ¢ Typical sale price of approx US $450K for 35’/40’ and US $700K for 60’ articulated ¢ Typical sale price of approx US $300K

HD Transit Bus Share (2015 market is ~5,800 units) Active Canada/US HD Transit Bus Coach Fleet ~85,000

Average Age of the HD Transit Fleet: US = 7.8 years, Canada = 7.3 years Source: APTA Public Transportation Factbook 2016

3% 19% 45%

33% Orion Parts and NABI acquired by NFI in 2013

Source: New Flyer Database & Management Estimates 7

Transit Bus Market Segments in Canada and US

Transit Market Segments 24 of the 25 largest Transit Agencies and primary targets operate NF supported transit buses

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

New market entrants focusing only on battery-electric buses:

Source: New Flyer Database & Management Estimates 8

#1 Market Share in Motor Coaches

New Coach – Private New Coach – Public Pre-Owned Coach

° Targets the mid-range to luxury segments ° Targets the mid-range segment ° Trade-in option to support new coach sales ° J Model is the #1 selling coach in the N.A. ° “Buy America” compliant ° Coaches are refurbished at MCI’s service private market ° D Model is the #1 selling coach of all time in N.A. centers and various 3 rd parties ° NA Distributor of Daimler’s SETRA coaches ° Transit authorities ° Value customers in the private market ° Tour and charter operators ° Universities ° Small private fleets ° Hotels and casinos ° U.S. Federal Government ° MCIU sells approx 350 pre-owned units annually ° Inter-city line-haul operators ° Correctional facilities ° Contract carriers

Motor Coach Share: 2015 market is ~2,300 units Active Canada/US Motor Coach Fleet ~55,500 units

Average Age of the Motor Coach Fleet: US and Canada = 9 years Source: ABA Motorcoach Census March 2015 Turkey 9%

Belgium & Macedonia 24% 38% 50% 1% 26% 23%

29%

Source: MCI Database & Management Estimates Canada & US 9

Motor Coach Market in Canada and US

Market Segments and primary targets Private Market Segment Definitions

Fixed Route/ Tour & Transit Conversion Line Haul Charter

12% of 2% of 34% of 52% of installed fleet installed fleet installed fleet installed fleet

Public Private Private Private

Source: MCI Database & Management Estimates 10

+ Environmental Commitment: Green Propulsion Options

Clean Diesel Natural Gas Electric-Trolley Hybrid-Electric Battery-Electric

Clean Natural Electric Hybrid All Diesel Gas Trolley Electric Electric

Xcelsior

MiDi

D Model

J Model

Additional propulsion options currently being evaluated for NFI MiDi and MCI J Model 11

+ Annual Deliveries and Market Demand

Transit Bus EUs delivered in Can/US Motor Coaches delivered in Can/US

7000 7000 6,236 6,032 5,933 5,872 6000 5,816 Total 6000 5,388 5,347 5,284 5,212 5,154 5,128 5,109 5,065 5,010 5,009 Industry 4,797 5000 4,723 5000 4,333 4,047 4000 4000 2,990 3000 3000 2,824 Total 2,485 2,451 2,437 2,381 2,330 2,311 2,257 2,191 2,164 Industry 2,099 2,051 2,023 2,048 2,003 1,938 1,926 1,864 1,852 1,811 1,820 1,773 1,752 1,731 1,656 1,583 1,584 2000 1,566 2000 1,543 1,500 1,475 1,442 1,343 1,272 1,208 1,050 1000 935 1000 1,492 1,862 1,767 1,190 1,479 1,514 1,022 1,050 1,292 1,056 1,012 753 811 633 592 686 821 802 856 0 0

Public Bid Universe & Active Opportunities (EUs) 2009-2016 US Federal Funding for Transportation

Operator RFPs Bids submitted NFI forecasted Issued. EUs for Proposals by NFI and EUs awaiting EU buys in in development selection next 5 years

Source: MCI Database & Management Estimates 12

+ Public Customer Book-to-Bill and Backlog

Book-to-Bill consistently >100% for 15 of last 16 Quarters

Growing Total Backlog (Firm and Options)

10000 9000 8000 7000 6000 Deferred Order Option 5000 Option 4000 Deferred Order Firm 3000 Firm 2000 1000 0 Q4-06 Q1-07 Q2-07 Q3-07 Q4-07 Q1-08 Q2-08 Q3-08 Q4-08 Q1-09 Q2-09 Q3-09 Q4-09 Q1-10 Q2-10 Q3-10 Q4-10 Q1-11 Q2-11 Q3-11 Q4-11 Q1-12 Q2-12 Q3-12 Q4-12 Q1-13 Q2-13 Q3-13 Q4-13 Q1-14 Q2-14 Q3-14 Q4-14 Q1-15 Q2-15 Q3-15 Q4-15 Q1-16 Q2-16 Q3-16 Q4-16

Includes MCI backlog as at Q4-15 Note: US Customer deferred Order was removed from backlog IN 2013 following 5 years of inaction. 13

+ Manufacturing, Fabrication and Service Footprint

MCI - , MB Parts Fabrication, MCI D Model Shell Assembly NFI - Winnipeg, MB Montreal, PQ Complete J Model manufacture Parts Fabrication and Bus Shell Assembly MCI Service Center New Product Development New Product Development Frank Fair Fiberglass Fabrication

AB Arnprior, ON Renton, WA SK MB QC NFI Service Center NFI Service Center ON

ND Jamestown, NY MN Part Fabrication/Assembly NY

` PA NJ Blackwood, NJ MCI Service Center

IN OH CA IL WV

KY , CA NFI Completion & Service Center

AL Los Alamitos, CA Winter Garden, FL MCI Service Center Pembina, ND TX FL MCI Service Center MCI D Shell Completion

Des Plaines, IL MCI Service Center St Cloud, MN NFI Bus Manufacture

Anniston, AL Dallas, TX Elkhart, IN Crookston, MN NFI Bus Manufacture NFI Bus Completion MCI Service Center TCB Part Fabrication 14

+ Industry’s most comprehensive Bus/Coach Parts

Aftermarket Parts Product Support Services

¢ Widest transit bus and motor coach product ¢ Publications: Wide range of customized parts, assortment and industry leading distribution network maintenance and operational documentation. New with shortest delivery times. Flyer & MCI publications are the industry standard.

¢ Training: Operator and maintenance training provided ¢ Added value through Unique offerings (Kits, Mid-life in connection with new bus sales or aftermarket upgrade programs, Vendor Managed Inventory, support (On-the-job, Classroom, eLearning, etc.). In KanBan, etc). addition to on-site training, the Louisville Kentucky facility serves as the national coach training facility for

¢ New website offering state of the art sales and MCI. distribution features. 15

+ Parts Distribution Footprint

Edmonton, AB Winnipeg, MB Brampton, ON MCI Parts Distribution (3PL) NFI Parts Distribution NFI Parts Distribution

AB SK MB QC Montreal, PQ ON MCI Service Center

ND MN NY Blackwood, NJ MCI Service Center

` PA NJ East Brunswick, NJ IN OH CA IL WV MCI Parts Distribution

Fresno, CA KY NFI Parts Distribution Delaware, OH NABI Parts Distribution

Hebron, KY AL NFI Parts Distribution Los Alamitos, CA MCI Service Center TX FL Louisville, KY MCI Parts Distribution

Des Plaines, IL MCI Service Center

Dallas, TX Winter Garden, FL MCI Service Center MCI Service Center 16

NFI Group + Financial Performance

Sales ($M US) Adjusted EBITDA ($M US)

2500 300 257 2,071 2000 250 390 1,451 1,539 76 200 1500 1,199 322 151 319 150 865 215 107 1000 95 61 119 1,681 100 181 61 31 50 1,132 1,217 500 984 746 50 20 90 64 57 41 0 0 2012 2013 2014 2015 2016 Q3 LTM 2012 2013 2014 2015 2016 Q3 LTM

Bus Aftermarket Bus Aftermarket Quarterly Adjusted EBITDA ($M US) Return on Invested Capital

257 260 ROIC = Net operating profit after tax 229 240 Average invested capital for the period 220 1200 188 14.1% 200 14%

12.2% 1000 180 151 141 12% 8.5% 160 131 140 119 8.6% 800 108 110 107 10% Millions 120 95 99

Millions 8% 600 100 75 71 71 6.2% 63 61 61 1,068 80 59 6% 60 80 400 68 707 712 40 64 4% 641 45 548 39 200 20 24 37 27 26 35 31 36 16 16 14 15 18 20 2% 0 14 2012 2013 2014 2015 2016 0% 0 Adjusted EBITDA LTM Adjusted EBITDA 2012 2013 2014 2015 2016 Q3 LTM Average Invested Capital forReturn the period on Invested Capital 17

NFI Group + Operating Performance

Deliveries of new Bus and Coach Equivalent Units (EUs) Adjusted EBITDA per new EU delivered ($000 US)

993 1000 $70 66.5 912 900 829 $60 56.4 777 54.7 800 680 689 $50 700 45.3 635 621 625 43.0 577 582 572 594 600 554 $40 37.7 490 489 34.1 34.6 500 442 441 $30 27.5 386 387 25.6 24.9 26.3 25.8 400 23.1 21.6 23.9 20.2 20.2 300 $20 14.0 200 $10 100

0 $0

Aftermarket EBITDA Margin %

Aftermarket Adjusted EBITDA / Aftermarket Revenue

22%

20.5% 20.1% 20.2% 20% 18.8% 18.6% 18.6% 18.6% 18.3% 18% 17.1% 16.3%

16.2% 16.0% 16% 15.4% 14.8% 14.7% 14.6%14.6% 14.2% 14.0% 14%

12% 18

NFI Group + Cash Flow Performance

2016 Q3 LTM Adjusted EBITDA to Free Cash Flow ($M) Free Cash Flow and Dividends ($M C)

250.0 300 218.6 256.9

250 200.0 51.7 218.6 22.8 200 150.0 166.9 108.3 49.4 150 15.0 2.8 100.0 65.5

100 45.1 27.1 50.0 50 47.8 33.1 30.7 32.5 33.8 - 0.0

2012 2013 2014 2015 2016 Q3 LTM

Free Cash Flow Dividends 19

NFI Group + Strong Balance Sheet with low Leverage Majority of Convertible Debentures issued in 2012 have now converted

Total Leverage does not include Convertible Debenture as debt.

Under NFI Senior Credit Agreement the Total Leverage Ratio must be maintained below 4X Adj EBITDA. The minimum ratio reduces to 3.75X effective January 2, 2017. Total Debt ($US M) Total Leverage Ratio $1,000 3.5 $900 3 $8M Convertible Debentures $800 issued in Jun-12 @ 6.25%. $700 2.5 Convert price $US10/share $600 2 $500 $343M Revolver Facility used to manage working capital $400 1.5 fluctuations ($77M outstanding) $300 1 $482M Senior Secured Term $200 Loan 0.5 $100 $0 0 2010 2011 2012 2013 2014 2015 2016 Q4* • Total Leverage Ratio for Q4-16 not yet available. As at Oct 2, 2016 the ratio was 2.08

IDS Debt Bachelor Bonds Senior Term Loan Revolver Convertible Debenture Total leverage ratio 20 APPENDIX A

Canadian and US Bus Market Segments

Approx Annual Bus Type Deliveries (EUs) NFI Strategic Actions ~30,000 - 35,000 since 2011

Cutaways MiDi JV with (Truck Chassis based) ~15,000 - 18,000 ADL to diversify

Invest in OpEx Medium Duty Acquired TCB 2 Convert Capital Transit and Shuttle ~400 - 500 Structure

Acquired Orion Heavy Duty 1 Parts & NABI Transit EU’s ~5,200 - 5,500 (single and articulated) 3 Acquired MCI

Motor Coach ~2,000 – 2,500 4 21 APPENDIX B + FORWARD LOOKING STATEMENTS, FINANCIAL TERMS, DEFINITIONS AND CONDITIONS

FORWARD LOOKING STATEMENTS

This investor presentation contains forward-looking statements relating to expected future events, including the integration of the acquired business into New Flyer’s existing business and expected synergies, the diversification and growth of the combined bus and aftermarket parts businesses. Although the forward-looking statements contained in this investor presentation are based upon what management believes to be reasonable assumptions, investors cannot be assured that actual results will be consistent with these forward-looking statements, and the differences may be material. Actual results may differ materially from management expectations as reflected in such forward-looking statements for a variety of reasons, including risks related the ability to implement the operational changes necessary to achieve the intended synergies, acquisitions, joint ventures and other strategic relationships with third parties (including liabilities relating thereto), the covenants contained in the Company’s new senior credit facilities could impact the ability of the Company to fund dividends, market and general economic conditions and economic conditions of and funding availability for customers to purchase buses and to purchase parts or services, customers may not exercise options to purchase additional buses, the ability of customers to suspend or terminate contracts for convenience and the other risks and uncertainties discussed in the materials filed with the Canadian securities regulatory authorities and available on SEDAR at www.sedar.com . Due to the potential impact of these factors, the Company disclaims any intention or obligation to update or revise any forward- looking statements, whether as a result of new information, future events or otherwise, unless required by applicable law.

FINANCIAL TERMS, DEFINITIONS AND CONDITIONS

References to “EBITDA” are to earnings before interest, income taxes, depreciation and amortization, fair value adjustment for total return swap 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”), equity settled stock-based compensation, past service costs, fair value adjustment to MCI’s inventory and deferred revenue, proportion of the total return swap realized, loss on derecognition of long-term debt and costs associated with assessing strategic and corporate initiatives. Return on Invested Capital “ROIC” is calculated by dividing Net Operating Profit After Tax by Average Invested Capital for the period. References to “Net Operating Profit After Tax” are to Adjusted EBITDA less depreciation of plant and equipment and income taxes. References to “Invested Capital” are to shareholders’ equity plus long-term debt, obligations under finance leases, other long-term liabilities, convertible debentures and derivative financial instrument liabilities less cash.

Management believes EBITDA, Adjusted EBITDA, ROIC 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, past service costs, 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, realized ITCs, fair value adjustment to MCI’s inventory and deferred revenue, proportion of the total return swap realized and principal payments on capital leases. However, EBITDA, Adjusted EBITDA, ROIC 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, and Adjusted EBITDA 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, and Free Cash Flow should not be construed as an alternative to cash flows from operating, investing and financing activities determined in accordance with IFRS 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, ROIC 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 .

All figures are in U.S. dollars unless otherwise noted.