Q4 2018 EARNINGS PRESENTATION                                                                                                                                                                                       December 18, 2018               ® International is a registered trademark of                     , Inc.                                                                                                                                      NYSE: NAV
 Safe Harbor Statement and Other Cautionary Notes   Information provided and statements contained in this report that are not purely historical are forward-looking statements within  the meaning of the federal securities laws. 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 the risk factors set forth in our filings with the Securities and Exchange Commission, including our  annual report on Form 10-K for the fiscal year ended October 31, 2018. 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.  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. It also excludes financial services and other items that may not be related to  the core manufacturing business or underlying results. Management often uses this information to assess and measure the  underlying performance of our operating segments. We have chosen to provide this supplemental information to investors,  analysts, and other interested parties to enable them to perform additional analyses of operating results. The non-GAAP numbers  are reconciled to the most appropriate GAAP number in the appendix of this presentation.                                                                                              Q4 2018 Earnings – 12/18/2018                                                                                                       NYSE: NAV 2
 Fourth Quarter 2018 Highlights   • Revenue higher, led by a 41% increase in Truck revenue   • Grew market share in every segment sequentially and year over year   • Chargeouts increased 45% to 24,700   • Net income rose to $188M   • Adjusted EBITDA up 20% to $322M   • Manufacturing cash balance of $1.36B   • Repaid $200M convertible notes in October   • Strong backlog setting foundation for momentum into 2019   Note: This slide contains non-GAAP information; please see the REG G in appendix for a detailed reconciliation.  Q4 2018 Earnings – 12/18/2018                                                                 NYSE: NAV 3
 2018: Accomplishments and Recent Announcements    • Revenue up in all segments, led by a 29% increase in Truck   • Only OEM to grow Class 8 retail market share   • Gross margin of 18.9%, up 100 basis points year over year   • Sixth consecutive year of adjusted EBITDA and margin growth    • Net income increased to $340M from $30M in 2017   • Manufacturing free cash flow of $307M   • Fleetrite branded parts experienced double-digit growth year over year    • Announced 70% sale of Navistar Defense to Cerberus Capital Management    • Launched and began production of Class 4/5 products  Note: This slide contains non-GAAP information; please see the REG G in appendix for a detailed reconciliation.  Q4 2018 Earnings – 12/18/2018                                                                 NYSE: NAV 4
 Significant Improvement in Key Financial Metrics  ($ in millions, except per share and units)                                                                      Quarters Ended                                      Years Ended                                                                           October 31                                       October 31                                                                      2018                 2017                       2018                  2017  Chargeouts(A)                                                       24,700                17,000                    73,900                57,300   Sales and Revenues                                                  $3,317                $2,598                  $10,250                 $8,570  Net Income(B)                                                           $188                  $135                      $340                    $30  Diluted Income Per Share(B)                                            $1.89                 $1.36                     $3.41                 $0.32  Adjusted EBITDA                                                         $322                 $268                       $826                 $582   (A)   Includes U.S. and Canada School buses and Class 6-8 trucks.      Note: This slide contains non-GAAP information; please see the Q4 2018 Earnings – 12/18/2018  (B)   Amounts attributable to Navistar International Corporation, net of tax. REG G in appendix for a detailed reconciliation.                                                                                                                                                    NYSE: NAV      5
 All Segments Profitable in Q4  ($ in millions)                     Sales and Revenues     Segment Profit                       Quarters Ended                Quarters          Ended                                                  October 31          October 31                      2018      2017       2018      2017     Truck             $2,619    $1,853      $197      $112     Parts              $633      $626       $156      $157     Global Operations   $93       $105       $4         $1     Financial Services  $70       $63       $26        $26                                                         Q4 2018 Earnings – 12/18/2018                                                             NYSE: NAV 6
 Truck Segment Driving Improved Results   ($ in millions)                        Sales and Revenues     Segment Profit                           Years Ended                      Years    Ended                                                    October 31            October 31                          2018      2017       2018       2017      Truck              $7,490     $5,809      $397         ($6)      Parts              $2,407     $2,392     $569         $616      Global Operations   $360       $309         $2         ($7)      Financial Services  $257       $235       $88          $77                                                             Q4 2018 Earnings – 12/18/2018                                                                 NYSE: NAV 7
 Positive Free Cash Flow and Strong Cash Balance  ($ in millions)                                                                          ($ in billions)                      Manufacturing Free Cash Flow(A)                                                   Manufacturing Cash Balance (B)                                                                                                                                                           $1,362      $325                                                          $307                   $1,400                                                                                                                                   $1,100       $1,084      $200                                                                                                       $1,036                                                                                           $1,050                                                                                                                     $947        $75                                                                                             $700      ($50)                                              ($99)                                                                                            $350    ($175)      ($300)            ($278)                                                                   $0                      2016                   2017                  2018                              Q4 2017       Q1 2018      Q2 2018      Q3 2018      Q4 2018     (A)  Amounts exclude dividends from financial services operations.                                                                                                                                                   NYSE: NAV   (B)  Amounts include manufacturing cash, cash equivalents, and marketable securities. Q4 2018 consolidated cash balance is $1.42 billion.                     8   Note: This slide contains non-GAAP information; please see the REG G in appendix for a detailed reconciliation.
 Strengthening Balance Sheet   ($ in millions)                                                                         ($ in billions)                 Limited Near-Term Debt Maturities(A)                                    $4         Pension and OPEB Under-Funded Status  $2,000                                                                                                        Improved $1B Since 2016                                           $1,600                                                        $3.1                                                                                         $3                                                                                                                                $2.5                                                         $1,100                                                                                        $2.1                                                                                         $2 $1,000                                                                                           $1                $411                                                                       $225       $0                                                                                  $-               2019       2020-2024        2025          2026      Thereafter                           2016                   2017                    2018                                                                                                                      Pension        OPEB     (A)  Total manufacturing debt of $3.4B as of October 31, 2018. Graph does not include financed lease obligations and               Q4 2018 Earnings – 12/18/2018         other, totaling $148 million.                                                                                                                                                    NYSE: NAV      9
 Strong Industry Expected to Continue Into 2019                                    2018 Actual           2019 Guidance    Class 8                            277K                 265-295K    Class 6/7                           99K                   95K    School bus                          33K                   35K    Core markets industry              409K                 395-425K                                                                 Q4 2018 Earnings – 12/18/2018                                                                      NYSE: NAV 10
 2019 Financial Guidance                                             2018 Actuals     2019 Guidance     Revenue                                    $10.25B       $10.75-$11.25B     Gross margin                               18.9%          19.0%-19.5%     Adjusted EBITDA                            $826M          $850-$900M     Manufacturing interest expense             $235M            $225M     Warranty spend greater than expense        $141M             $90M     Capital expenditures                       $113M            $150M     Pension/OPEB contributions greater than                                                $81M              $85M    expense     Core Market Share                          17.5%             18.5%   Note: This slide contains non-GAAP information; please see the REG G in appendix for a detailed reconciliation. Q4 2018 Earnings – 12/18/2018     2019 financial guidance includes fully consolidated financial impact of the Navistar Defense business.                                                                         NYSE: NAV 11
 Appendix                                                                                                                                      Q4 2018 Earnings – 12/18/2018                                                                                                                                                  NYSE: NAV    12
 Legacy Issues Behind Us   ($ in millions)               Used Truck Inventory $250                                          • Gross inventory balance:                                                                        $154 million                                                  o MaxxForce 13s in inventory:                                                         176 units $125                                               • Net inventory balance:                                                                          $123 million   $0        Q4     Q1      Q2     Q3      Q4       • Q4 inventory reserve:                2017    2018   2018    2018   2018              Gross Inventory Net Inventory      $31 million                                 (A) $1,000     Warranty Spend vs. Expense                                               • Q4 warranty expense  $750                                                (excluding pre-existing) as a  $500                                           percentage of revenue: 1.7%                                                o 2.4% in 4Q17 $250                                               • Warranty liability balance:      $0                                           $529 million       2013 2014 2015  2016 2017  2018 2019*              Warranty Spend Warranty Expense    (A) 2019 warranty spend vs. expense are estimates.       Q4 2018 Earnings – 12/18/2018                                                                  NYSE: NAV 13
 U.S. and Canada Dealer Stock Inventory*   6,000    5,500    5,000    4,500    4,000    3,500    3,000   *Includes U.S. and Canada Class 4-8 truck inventory, but does not include U.S. IC Bus.                                                                                               Q4 2018 Earnings – 12/18/2018                                                                                                        NYSE: NAV 14
 Retail Market Share in Commercial Vehicle Segments                                                 Years Ended October 31,                                            2018        2017        2016        Core Markets (U.S. and Canada)           School buses................................................. 33 % 32 % 34 %           Class 6 and 7 medium trucks ................. 23 % 25 %     21 %           Class 8 heavy trucks .................................. 14 % 11 % 10 %           Class 8 severe service trucks .................. 13 % 13 %  13 %             Total Core Markets..................... 17 %  17 %        16 %           Combined class 8 trucks .......................... 14 % 12 % 11 %                Class 6/7                     Class 8                     Class 8             Medium-Duty                     Heavy                   Severe Service                                                                         Q4 2018 Earnings – 12/18/2018                                                                               NYSE: NAV 15
 Worldwide Truck Chargeouts                                             Three Months                           Years Ended                                                    Ended October 31,              %         October 31,                 %                                           2018      2017    Change   Change      2018     2017    Change   Change Core Markets (U.S. and Canada)    School buses(A).................................................    3,700       2,900        800 28%   12,200    11,300        900 8%    Class 6 and 7 medium trucks ..........................    6,800       5,200      1,600 31%  24,300   20,900     3,400 16%    Class 8 heavy trucks .........................................   10,600       6,500      4,100 63%  27,800    16,800    11,000 65%    Class 8 severe service trucks(B)........................    3,600       2,400      1,200 50%    9,600     8,300      1,300 16%        Total Core markets..........................  24,700      17,000     7,700 45%  73,900   57,300    16,600 29%    Non "Core" defense..........................................        200          300       (100) -33%        700        800       (100) -13%    Other markets(C)...............................................    3,700       3,900       (200) -5%    9,600    10,800    (1,200) -11%        Total worldwide units......................  28,600      21,200     7,400 35%  84,200   68,900    15,300 22%    Combined class 8 trucks ..................................   14,200       8,900     5,300 60%  37,400    25,100    12,300 49%  We define chargeouts as trucks that have been invoiced to customers. The units held in dealer inventory represent the principal difference  between retail deliveries and chargeouts. The above table summarizes our approximate worldwide chargeouts.  We define our Core markets to include U.S. and Canada School bus and Class 6 through 8 trucks.   (A) The School bus chargeouts include buses classified as B, C, and D and are being reported on a one-month lag. (B) Chargeouts include CAT-branded units sold to Caterpillar under our North America supply agreement during 2016. (C) Other markets primarily consist of Export Truck and Mexico.                                                                                                Q4 2018 Earnings – 12/18/2018                                                                                                        NYSE: NAV 16
 Financial Services Segment   Highlights    •  Financial Services segment profit of $26M for Q4 2018 and $88M for YTD 2018          •  NFC1 earned pre-tax profit of $15.6M for Q4 and $51.7M for YTD 2018    •  NFC financing availability of $328M as of October 31, 2018, $248M available under the $269M revolver     •  Financial Services debt/equity leverage of 3.5:1 as of October 31, 2018    •  Dealer note funding - Refinanced $300M of maturing investor notes and renewed the $350M variable notes        facility                                                 NFC Facilities        Dealer Floor Plan                        Retail Notes                   Bank and Term Loan B      • NFSC wholesale trust as of                                               • Revolver capacity of $269M        October 31, 2018                                                           matures September 2021, Term                                                       C A P I T A L               Loan B of $400M matures July       – $900M funding facility              Funded by BMO Financial Group      – Variable portion matures                                                  2025         May 2020                         • Program management continuity          – Funding for retail notes,       – Term portions mature June 2019   • Broad product offering                  wholesale notes, retail accounts,         and September 2020               • Ability to support large fleets         and dealer open accounts                                                                                • On balance sheet     • On balance sheet                  • Access to less expensive capital      1Navistar Financial Corporation (NFC) is the U.S. financial entity of Navistar’s Financial Services segment. Q4 2018 Earnings – 12/18/2018                                                                                                        NYSE: NAV 17
 Frequently Asked Questions  Q1:  What is included in Corporate and Eliminations? A:   The primary drivers of Corporate and Eliminations are Corporate SG&A, pension and OPEB expense (excluding amounts       allocated to the segments), annual incentive, manufacturing interest expense, and the elimination of intercompany sales       and profit between segments.  Q2:  What is included in your equity in income of non-consolidated affiliates?  A:   Equity in income of non-consolidated affiliates is derived from our ownership interests in partially-owned affiliates that       are not consolidated.  Q3:  What is your net income attributable to non-controlling interests? A:   Net income attributable to non-controlling interests is the result of the consolidation of subsidiaries in which we do not       own 100%, and is primarily comprised of Ford's non-controlling interest in our Blue Diamond Parts joint venture.  Q4:  What are your expected 2018 and beyond pension funding requirements?  A:   In 2018 and 2017, we contributed $132 million and $112 million, respectively, to our U.S. and Canadian pension plans (the       "Plans") to meet regulatory minimum funding requirements. In 2019 we expect to contribute approximately $140 million       to meet the minimum required contributions for all plans. Future contributions are dependent upon a number of factors,       principally the changes in values of plan assets, changes in interest rates, and the impact of any future funding relief. We       currently expect that from 2020 through 2022, we will be required to contribute approximately $175 million to $200       million per year to the Plans, depending on asset performance and discount rates. Q5:  What is your expectation for future cash tax payments? A:   Our cash tax payments are expected to remain low in 2019 and will gradually increase as we utilize available net       operating losses (NOLs) and tax credits in future years.                                                                                       Q4 2018 Earnings – 12/18/2018                                                                                               NYSE: NAV 18
 Frequently Asked Questions  Q6: What is the current balance of net operating losses as compared to other deferred tax assets?  A: As of October 31, 2018, the Company had deferred tax assets for U.S. federal NOLs valued at $560     million, state NOLs valued at $178 million, and foreign NOLs valued at $241 million, for a total     undiscounted cash value of $979 million. In addition to NOLs, the Company had deferred tax assets for     accumulated tax credits of $212 million and other deferred tax assets of $1.1 billion resulting in net     deferred tax assets before valuation allowances of approximately $2.3 billion. Of this amount, $2.2 billion     was subject to a valuation allowance at the end of FY2018. Q7: How does your FY 2019 Class 8 industry outlook compare to ACT Research?   A:         Reconcilation to ACT - Retail Sales 2019    ACT*                                    293,000    CY to FY Adjustment                     11,000    "Other Specialty OEMs" included in ACT's forecast; we do not include                                             (6,000)    these specialty OEMs in our forecast or in our internal/external reports    Total (ACT comparable Class 8 Navistar) 298,000    Navistar Industry Retail Deliveries Combined Class 8 Trucks 265,000 295,000    Navistar Difference from ACT         (33,000) (3,000)    *Source: ACT N.A. Commercial Vehicle Outlook - May 2018 (11.1%) (1.0%) Q8: Please discuss the process from an order to a retail delivery? A: Orders* are customers’ written commitments to purchase vehicles. Order backlogs* are orders yet to be     built as of the end of a period. Chargeouts are vehicles that have been invoiced to customers. Retail     deliveries occur when customers take possession and register the vehicle. Units held in dealer inventory     represent the principal difference between retail deliveries and chargeouts.    * Orders and units in backlog do not represent guarantees of purchases and are subject to cancellation.                                                                         Q4 2018 Earnings – 12/18/2018                                                                               NYSE: NAV 19
 Frequently Asked Questions  Q9: How do you define manufacturing free cash flow? A:                                                      Year Ended                                 Quarters Ended  (in millions)                                         Oct. 31, 2018     Oct. 31, 2018      Jul. 31, 2018    Apr. 30, 2018     Jan. 31, 2018  Consolidated Net Cash from Operating Activities...................... $                269 $                449 $                 (83) $                  (21) $                 (76)  Less: Net Cash from Financial Services Operations...................                   (150)                   (124)                     33                  (220)                    161      Net Cash from Manufacturing Operations (A)  .......................                   419                   573                   (116)                    199                  (237)  Capital Expenditures..........................................................................                   (112)                    (34)                    (25)                    (23)                    (30)      Manufacturing Free Cash Flow.......................................... $                307 $                539 $                (141) $                 176 $               (267)   _____________________________ (A)   Net of adjustments.  Q10: What were your Worldwide Engine Shipments in the period? A:                                                    Three Months                                     Years Ended                                                          Ended October 31,                      %            October 31,                        %                                                  2018        2017      Change     Change         2018        2017      Change      Change (in units)     OEM sales-South America................................       6,600        6,800         (200) -3%    25,700      21,300       4,400 21%     Intercompany sales...........................................       3,600        3,500           100 3%     13,200       11,300        1,900 17%     Other OEM sales...............................................          650           800          (150) -19%       2,850        2,600           250 10%        Total Core Markets..........................     10,850       11,100         (250) -2%      41,750       35,200        6,550     19%                                                                                                                       Q4 2018 Earnings – 12/18/2018                                                                                                                                 NYSE: NAV   20
 Outstanding Debt Balances                                                                                                             As of October 31,                 (in millions)                                                                              2018       2017                 Manufacturing operations                                                                                               Senior Secured Term Loan Credit Agreement, due 2025, net of unamortized discount of $7 and                                   unamortized debt issuance costs of $11 ............................................................................................................... $ 1,570  $ —                    Senior Secured Term Loan Credit Facility, as amended, due 2020, net of unamortized discount of $7,                           and unamortized debt issuance costs of $9........................................................................................................ —  1,003                    6.625% Senior Notes, due 2026, net of unamortized debt issuance costs of $17 ................................. 1,083   —                    8.25% Senior Notes, due 2022, net of unamortized discount of $13 and unamortized debt issuance                               costs of $14 ..................................................................................................................................................................... —  1,423                    4.50% Senior Subordinated Convertible Notes, due 2018, net of unamortized discount of $5 and                                 unamortized debt issuance costs of $1 ................................................................................................................. —  194                    4.75% Senior Subordinated Convertible Notes, due 2019, net of unamortized discount of $5 and $14,                            respectively, and unamortized debt issuance costs of $1 and $3, respectively ....................................... 405  394                    Loan Agreement related to 6.75% Tax Exempt Bonds, due 2040, net of unamortized debt issuance                                 costs of $5 at both dates ............................................................................................................................................ 220  220                    Financed lease obligations ........................................................................................................................................ 122   130                    Other ................................................................................................................................................................................. 26   43                        Total Manufacturing operations debt ....................................................................................................................  3,426   3,407                    Less: Current portion ................................................................................................................................................... 461   286                        Net long-term Manufacturing operations debt .................................................................................................  $ 2,965   $ 3,121                                                                                                              As of October 31,            (in millions)                                                                                   2018        2017            Financial Services operations                                                                                                Asset-backed debt issued by consolidated SPEs, at fixed and variable rates, due serially through                               2023, net of unamortized debt issuance costs of $4 and $5, respectively ............................................... $  948  $  849               Senior secured NFC Term Loan, due 2025, net of unamortized discount of $2, and unamortized                                     debt issuance costs of $4 ...........................................................................................................................................    394      —               Bank credit facilities, at fixed and variable rates, due dates from 2019 through 2024, net of                                  unamortized debt issuance costs of $2 and $2, respectively ........................................................................    519     616               Commercial paper, at variable rates, program matures in 2022 ..................................................................     75       92                                                                                                                                              Borrowings secured by operating and finance leases, at various rates, due serially through 2024     105        94                   Total Financial Services operations debt...............................................................................................................        2,041   1,651               Less: Current portion ...................................................................................................................................................         485      883                   Net long-term Financial Services operations debt ...........................................................................................  $     1,556   $ 768                                                                                                                                         Q4 2018 Earnings – 12/18/2018                                                                                                                                    NYSE: NAV   21
 SEC Regulation G Non-GAAP Reconciliation  SEC Regulation G Non-GAAP Reconciliation: The financial measures presented below are unaudited and not in accordance with, or an alternative for, financial measures presented in accordance with  U.S. generally accepted accounting principles ("GAAP"). The non-GAAP financial information presented herein should be considered supplemental to, and  not as a substitute for, or superior to, financial measures calculated in accordance with GAAP and are reconciled to the most appropriate GAAP number  below.  Earnings (loss) Before Interest, Income Taxes, Depreciation, and Amortization (“EBITDA”): We define EBITDA as our consolidated net income (loss) attributable to Navistar International Corporation, net of tax, plus manufacturing interest expense,  income taxes, and depreciation and amortization. We believe EBITDA provides meaningful information to the performance of our business and therefore  we use it to supplement our GAAP reporting. 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.  Adjusted EBITDA: We believe that adjusted EBITDA, which excludes certain identified items that we do not consider to be part of our ongoing business, improves the  comparability of year to year results, and is representative of our underlying performance. Management uses this information to assess and measure the  performance of our operating segments. We have chosen to provide this supplemental information to investors, analysts and other interested parties to  enable them to perform additional analyses of operating results, to illustrate the results of operations giving effect to the non-GAAP adjustments shown in  the below reconciliations, and to provide an additional measure of performance.  Manufacturing Cash, Cash Equivalents, and Marketable Securities: Manufacturing cash, cash equivalents, and marketable securities represents the Company’s consolidated cash, cash equivalents, and marketable securities  excluding cash, cash equivalents, and marketable securities of our financial services operations. We include marketable securities with our cash and cash  equivalents when assessing our liquidity position as our investments are highly liquid in nature. We have chosen to provide this supplemental information  to investors, analysts and other interested parties to enable them to perform additional analyses of our ability to meet our operating requirements, capital  expenditures, equity investments, and financial obligations.  Gross Margin consists of Sales and revenues, net, less Costs of products sold.  Structural Cost consists of Selling, general and administrative expenses and Engineering and product development costs.  Free Cash Flow consists of Net cash from operating activities and Capital Expenditures.                                                                                                        Q4 2018 Earnings – 12/18/2018                                                                                                                  NYSE: NAV  22
 SEC Regulation G Non-GAAP Reconciliation Manufacturing segment cash, Cash equivalents, and Marketable securities reconciliation:                                                                           Oct. 31,             Jul. 31,           Apr. 30,           Jan. 31,         Oct. 31, (in millions)                                                              2018                2018                2018               2018             2017 Manufacturing Operations:    Cash and cash equivalents..................................................................................... $         1261   $            989   $             1,060  $          671   $          666    Marketable securities..............................................................................................           101                 95                   40              276              370 Manufacturing Cash, Cash equivalents, and Marketable securities.............. $               1,362 $                   1,084 $                      1,100 $                947 $             1,036   Financial Services Operations:    Cash and cash equivalents..................................................................................... $          59    $             33   $               40   $           28   $           40    Marketable securities..............................................................................................                                -                               -                                 -                         -                         -  Financial Services Cash, Cash equivalents, and Marketable securities......... $        59    $             33   $               40   $           28   $           40  Consolidated Balance Sheet:    Cash and cash equivalents..................................................................................... $        1,320   $           1,022  $             1100   $          699   $          706    Marketable securities..............................................................................................           101                 95                   40              276              370 Consolidated Cash, Cash equivalents, and Marketable securities................ $               1,421 $                    1,117 $                     1,140 $                975 $             1,076                                                                             Year Ended          Year Ended          Year Ended  (in millions)                                                            Oct. 31, 2018      Oct. 31, 2017        Oct. 31, 2016  Consolidated Net Cash from Operating Activities.....................................................  $              269  $                  109  $                    267  Less: Net Cash from Financial Services Operations...................................................                 (150)                      107                        431     Net Cash from Manufacturing Operations (A)  ..............................................................                 419                          2                      (164) Capital Expenditures.....................................................................................................                 (112)                     (101)                       (114)    Manufacturing Free Cash Flow..........................................................................  $              307  $                  (99)  $                  (278)   (A)  Amounts exclude dividends from financial services operations.                                                                                                                                     Q4 2018 Earnings – 12/18/2018                                                                                                                                                   NYSE: NAV    23
 SEC Regulation G Non-GAAP Reconciliations  Earnings (loss) before interest, taxes, depreciation, and amortization (“EBITDA”) reconciliation                                                                   Quarters Ended October 31,      Years Ended October 31,  (in millions)                                                       2018           2017            2018           2017  Income attributable to NIC, net of tax.............................................................................. $ 188 $ 135 $ 340 $ 29  Plus:      Depreciation and amortization expense................................................................. 51 54 211  223      Manufacturing interest expense (A)........................................................................... 59 68 235 265  Adjusted for:      Income tax expense...........................................................................................................             (27) — (52) (10)  EBITDA................................................................................................................................................ $ 325 $ 257 $ 838 $ 527   ______________________   (A) Manufacturing interest expense is the net interest expense primarily generated for borrowings that support the manufacturing and corporate operations, adjusted to eliminate interest       expense of our Financial Services segment. The following table reconciles Manufacturing interest expense to the consolidated interest expense.                                                                      Quarters Ended October 31,   Years Ended October 31,       (in millions)                                                    2018          2017          2018          2017       Interest expense............................................................................................................................... $ 87 $ 89  $ 327 $ 351       Less: Financial services interest expense................................................................................. 28 21 92 86       Manufacturing interest expense................................................................................................. $ 59 $ 68 $ 235 $ 265                                                                    Quarters Ended October 31,    Years Ended October 31,  (in millions)                                                        2018           2017           2018          2017  EBITDA (reconciled above)................................................................................. $         325 $             257 $         838 $             527   Adjusted for significant items of:    Adjustments to pre-existing warranties (A)........................................................................            (5)                 3            (9)                (1)    Asset impairment charges (B)....................................................................................................             3 —           14               13     Restructuring (C) .............................................................................................................................. — 7 (1) 13     EGR product litigation (D)............................................................................................................ — — 1 31     Gain on sale (E).................................................................................................................................. — — — (6)    Debt refinancing charges (F)...................................................................................................... — 1 46 5     Pension settlement (G).................................................................................................................. — — 9 —    Settlement gain (H)......................................................................................................................... (1) — (72) —  Total adjustments.................................................................................................................................. (3)                11 (12)               55   Adjusted EBITDA................................................................................................. $         322 $             268 $         826 $             582   Adjusted EBITDA Margin................................................................................................................... 9.7% 10.3% 8.1% 6.8%  For more detail on the items noted, please see the footnotes on slide 25.                                                                                                        Q4 2018 Earnings – 12/18/2018                                                                                                                   NYSE: NAV  24
 Significant Items Included Within Our Results                                                                                       Quarters Ended October 31,               Years Ended October 31, (in millions)                                                                            2018               2017                 2018               2017 Expense (income):    Adjustments to pre-existing warranties (A)........................................................................             (5)                  3             (9)                  (1)    Asset impairment charges (B)....................................................................................................              3 —            14                 13     Restructuring (C) .............................................................................................................................. — 7 (1)  13     EGR product litigation (D)............................................................................................................ — — 1              31     Gain on sale (E).................................................................................................................................. — — — (6)    Debt refinancing charges (F)...................................................................................................... — 1 46                  5     Pension settlement G).................................................................................................................... — — 9          —    Settlement gain (H).........................................................................................................................             (1) — (72) —    _____________________    (A) Adjustments to pre-existing warranties reflect changes in our estimate of warranty costs for products sold in prior periods. Such adjustments typically occur when claims experience deviates         from historical and expected trends. Our warranty liability is generally affected by component failure rates, repair costs, and the timing of failures. Future events and circumstances related to         these factors could materially change our estimates and require adjustments to our liability. In addition, new product launches require a greater use of judgment in developing estimates         until historical experience becomes available.    (B) During 2018, we recorded $14 million of impairment charges related to the exit of our railcar business in Cherokee, Alabama, certain long-lived assets and certain assets under operating         leases in our Truck and Financial Services segments. During 2017, we recorded $13 million of asset impairment charges in our Truck segment relating to assets held for sale of our Conway,         Arkansas fabrication business and for certain assets under operating leases.     (C) During 2018, we recognized a benefit of $1 million related to adjustments for restructuring in our Truck, Global Operations and Corporate segments.  During 2017, we recorded charges of         $13 million primarily attributable to $41 million of charges related to our plan to cease production at our Melrose Park Facility, a net benefit of $36 million related to the resolution of the         closing agreement and wind up charges for our Chatham, Ontario plant, and the release of $1 million in other postemployment benefits liabilities in connection with the sale of our         fabrication business in Conway, Arkansas. We also recorded $6 million of restructuring charges in Brazil related to cost reduction actions consisting of personnel costs for employee         separation and related benefits.    (D) During 2018, we recognized an additional charge of $1 million for a jury verdict related to the MaxxForce engine EGR product litigation in our Truck segment. During 2017, we recognized a         charge of $31 million related to that same jury verdict in our Truck segment.    (E) During 2017, we recognized a gain of $6 million related to the sale of a business line in our Parts segment.    (F) During 2018, we recorded a charge of $46 million for the write off of debt issuance costs and discounts associated with the repurchase of our 8.25% Senior Notes and the refinancing of our         previously existing Term Loan. During 2017, we recorded a charge of $5 million related to third party fees and debt issuance costs associated with the replacement of our Term Loan with our         Term Loan Credit Agreement and the refinancing of the revolving portion of the NFC bank credit facility in our Financial Services segment.     (G) During 2018, we purchased a group annuity contract for certain retired pension plan participants resulting in a plan remeasurement. As a result, we recorded a pension settlement         accounting charge of $9 million in SG&A expenses.    (H) During 2018, we settled a business economic loss claim relating to our Alabama engine manufacturing facility in which we will receive a net present value of $70 million, net of our fees and         costs, from the Deepwater Horizon Settlement Program. We recorded the $70 million net present value of the settlement and related interest income of $2 million in Other Income, net.                                                                                                                                           Q4 2018 Earnings – 12/18/2018                                                                                                                                                       NYSE: NAV    25