Make Every School Bus Better. Thomas Bus Oct 4, 2011 Steve D Goss Sanjay Kumar Jim Lannan

Agenda Update on successes IC Bus ‘Fluid’ Economy Claims Cummins Fuel Economy How to sell Cummins

School Bus Industry Data Industry data suggests a 5% gain in Cummins market share (50% to 55%) Recently gained business with largest bus customer

IC Bus ‘Fluid’ Economy Claims IC Bus published report of fuel economy testing stating ‘up to a 4.5%’ advantage vs Cummins Cummins responded to claims outlining the points in question including: Transmission shift calibration selections Aftertreatment regeneration ‘Fluid Economy’ also ignores the price differential Avg. Diesel Price $3.80 Avg. Bulk DEF Price $2.85

Transmission shift calibrations IC Bus did not outline what shift calibrations were used during testing Cummins testing validates that proper selection can result in significant fuel economy gains

Aftertreatment Regeneration Typical regen cycle on MF 7 at approx. 135 miles Same distance as test More EGR = More Soot Generated = More Regens Regenerations require the use of more fuel thus diminishing overall fuel economy

‘Fluid’ Economy IC’s claims of ‘fluid’ economy inaccurately represent total cost of ownership No mention of DEF consumption thus inability to analyze actual DEF usage for test Differences in DEF and diesel fuel pricing vary significantly so need to be analyzed separately

Cummins Fuel Economy ‘Others Test. We Deliver’ Cummins and Thomas Bus both currently testing

ISB Fuel Economy Tops DTNA Testing Freightliner M2 106 with Cummins ISB (EPA 10) Vs. International Durastar 4300 with MaxxForce DT (EPA10) Result 8.5% Better Fuel Economy 2 Regens for ISB Vs 10 for MaxxForce DT in the 14 hour test period

In Cylinder NOx Control Challenges Fuel economy significantly compromised Increased risk of EGR condensation Significant increase in heat rejection Complex system integration Driver satisfaction significantly compromised Power density and torque limitations

In Cylinder NOx Control Challenges 5-9% disadvantage Combustion efficiency degradation: Higher engine pumping losses Increased intake & exhaust manifold pressures Increased Particulate Filter regenerations Fuel Economy Significantly Compromised

In Cylinder NOx Control Challenges Increased Risk of EGR Condensation Higher EGR flow produces excessive acidic condensation Power cylinder corrosion Rapid deterioration of lube oil Reliability and durability compromised

In Cylinder NOx Control Challenges Significant Increase in Heat Rejection 20% increase Higher EGR flow: Multiple EGR coolers on & off engine Larger vehicle cooling package Major redesign of radiator / Charge Air Cooler / Fan systems

In Cylinder NOx Control Challenges Complex System Integration Higher EGR flow Air handling system Vehicle cooling system

In Cylinder NOx Control Challenges Higher EGR Flow Throttle Response Driver Satisfaction Significantly Compromised

In Cylinder NOx Control Challenges Deterioration of 50 – 100 hp for same displacement Higher EGR flow & EGR controls compromises engine performance Power Density and Torque Limitations

Bus Owners Have Two Choices for 2010 Advanced EGR Intercooler Clean Air DOC DPF Radiator Higher heat rejection: Larger Radiator Larger Charge air cooler EGR + SCR After-Treatment System Setup Tank Catalyst Doser AMOX Cat DOC DPF

Emissions Control Technology NOx is converted into N2 and H20 downstream from the engine using a diesel exhaust fluid catalyst Exhaust gas is re-circulated through the cylinders reducing peak combustion temperature, lowering NOx emissions SCR allows for a lower EGR run rate, increasing fuel economy and engine life With emission controls moved out of and away from the engine, power generation is unhindered EGR introduces excessive carbon and soot into the cylinder, causing pre-mature liner and piston wear Higher EGR cooling capacity strains the cooling system, leading to shorter coolant change intervals and component failure

The Facts about the Fluid – DEF Properties Acidic pH DEF is safe to handle and store Non-toxic Non-polluting Non-flammable DEF freezes at 12° F (-11° C). However, frozen DEF does not impact start up and normal operation of the vehicle When stored at extreme temperatures, neither DEF nor Urea become toxic DEF is slightly alkaline with a pH of approximately 9 DEF

DEF - Myths & Facts Navistar’s claim of ammonia level being close to 1000 ppm in a near empty DEF tank is a ‘stretch of imagination’ DEF, when heated and maintained at a constant temperature 120 degrees Fahrenheit, will very slowly start to form small amounts of ammonia It would take over two years at this constant temperature to convert DEF into levels of 1000 ppm of ammonia Such a situation can be probably modeled in ‘laboratory setting’ but not in the real world

Cummins ISB6.7 vs Navistar MaxxForce 7 Competitive Comparison

Cummins ISB6.7 vs. MaxxForce 7 Feature Cummins Advantage Displacement 6.7L 6.4L - Configuration Inline 6 V-8 Fewer parts / better reliability Horsepower 200 - 325 HP 200 - 300 HP Better power density Torque 520 -750 lb-ft 560 - 660 lb-ft Aspiration One - variable geometry turbo (2) dual stage turbos Oil change interval 15,000 mi. (24,000 km) 10,000 mi. (16,000 km) Lower maintenance cost / better uptime Engine weight (dry) 1,150 lb (522 kg) 1,225 lb. (556 kg) Lower weight

Competitive Comparison Summary Feature Cummins ISB6.7 Advantage MaxxForce 7 Complexity Single VG turbo, single radiator & charge air cooler Dual turbos, multiple charge air coolers and radiators, large EGR cooler Emission Controls Diesel Particulate Filter and Selective Catalytic Reduction Diesel Particulate Filter and Advanced EGR Maintenance and Service 15,000 mile service intervals and 3,500 authorized service locations 10,000 service intervals and 900 authorized service locations

Designing For the School Bus Market Reliability Total cost of ownership Low maintenance Safe Operation Sociability Performance Weight/space Minimal driver training Ease of operation Information systems Emissions compliance

Cummins Diesel Power

ISB6.7 & ISC8.3 Features Improved combustion system Advanced VGT Turbocharger Improved cooled-EGR subsystem/cooling circuit Fully integrated electronic controls New Cummins Aftertreatment System

ISB6.7 & ISC8.3 Customer Benefits Best-in-Class Fuel Economy Improved Reliability Minimal Installation Impact Stronger Performance Increased Power Density

Cummins Natural Gas Power

ISL G Product Features and Benefits 8.9L Stoichiometric Cooled EGR engine with spark ignition In production since mid-2007 Low emissions Diesel-‘like’ Performance, Reliability and Durability Over 80% parts commonality with ISL9 Compatible with CNG, LNG, or Biomethane (RNG)

2010 ISL G Natural Gas Stoichiometric Combustion Cooled EGR Same rated speed as ISL9 diesel 30% more torque at idle 5% better fuel economy Three Way Catalyst Aftertreatment Passive device Packaged as a muffler Maintenance-Free

Aftertreatment System Integrating Critical Subsystems Filtration and Diesel Exhaust Fluid Electronic Controls Aftertreatment System Combustion Technology Turbochargers Fuel Systems

PowerSpec www.powerspec.cummins.com Software Application Provide gearing recommendation Customize engine ‘specs’ Collect valuable trip information Free to download and use www.powerspec.cummins.com

INLINE™ adapter Cummins datalink adapter used in conjunction with PowerSpec Allows user to: transfer feature parameter settings download trip information INLINE™ 5 kit (part number: 4918416) includes all necessary parts to connect the vehicle to a laptop

Make Every TM School Bus Better. Better Fuel Economy. Up to 3% better than our ’07 ISB and ISC Joint testing underway on EPA 2010 product Better Performance. Improved driveability and throttle response Better Reliability. Best-in-class durability and dependability Better for the Environment. Near zero NOx and PM emissions Improved MPG results in smaller carbon footprint

Saf-T-Liner EFX

Common Parts with HDX means faster design cycle Sub-system ID (estimated number of parts to be eliminated ~100) Destination Sign (20) Front Roof Cap (6) #2 Hood (2) Clearance/Marker Lights (6) Windshield (3) Wipers (15) Header Height/Drip Rail (4) “A” Mirrors (8) Hazard Lights (4) “B” Mirrors (8) Bumper (10) Headlight & Bezel (4) Walk Gate (8) 00000-00-Thomas Built Buses Standard Template.ppt

Driver Focused Improvements - Storage Added driver’s storage to right side dash Can be used for safety equipment storage or for personal items 00000-00-Thomas Built Buses Standard Template.ppt

Driver Focused Improvements - Visibility Improved visibility HDX windshield Larger driver’s side window Argosy headlights Running lights standard 00000-00-Thomas Built Buses Standard Template.ppt

Driver Focused Improvements - Visibility Improved defrost capability 00000-00-Thomas Built Buses Standard Template.ppt

Technician Focused Improvements - Access Headlight doors and removable grill provide easy service access Lights Wiper motors and linkages Washer fluid Power steering reservoir Defrost heater relays 00000-00-Thomas Built Buses Standard Template.ppt

Technician Focused Improvements - Access Lower driver side access panel for chassis PDM’s 00000-00-Thomas Built Buses Standard Template.ppt

Technician Focused Improvements – Misc. More reliable components should translate to fewer replacements Increased parts commonality means less parts for technician to maintain Bus can still be jacked up by front bumper 00000-00-Thomas Built Buses Standard Template.ppt

Family Look HDX EFX 00000-00-Thomas Built Buses Standard Template.ppt

EFX Status Gate 9/8 Status: Passed (May 9th) Gate 7/6 Status: Passed Scheduled SOP: Q1 2012 Project Budget approved. Bus to be showcased at NAPT in October. Estimated start of production 1Q2012 Pilot/Preseries We’ll be soliciting orders within the next month Will come with new sales codes – WebEx will be scheduled to assist in ordering process Will come with $300 cost increase Design Validation Cooling passed. FEA and fatigue analysis in progress. Defrost testing planned for early October 6000 mile durability to begin mid-September at Bosch Proving Grounds. 00000-00-Thomas Built Buses Standard Template.ppt

Questions? Thomas Built Buses Dealer Sales Meeting 2012