New Flyer Provides Further Information Regarding Changes to Buy America Rules

Winnipeg, Manitoba, Canada − September 21, 2007 

(TSX:NFI.UN) Further to the release issued this morning, New Flyer Industries Inc. and New Flyer Industries Canada ULC (together, the “Company” or “New Flyer”) wish to provide further information regarding the Federal Transit Administration (the “FTA”) announcement yesterday of certain changes to the Buy America rules, effective October 22, 2007, including amendments to the definition of “final assembly”.

The Company, together with other affected manufacturers, is in the process of seeking clarification of the rule changes from the FTA given that the changes contradict the FTA’s own commentary that accompanied the rule changes and given that the changes had been previously strenuously opposed by numerous manufacturers and suppliers in the transportation manufacturing industry.  It is unclear how the new definition of “final assembly”, if it is valid and is implemented as published, will be interpreted, applied or enforced by the FTA.  If the new definition is determined to be incorrect, the Company cannot predict what the substance of a revised definition would be.

The new definition, if valid and depending on how it may be interpreted, applied and enforced by the FTA in the short term, may have a material adverse effect on the Company’s operations and financial results, and in particular its present ability to complete assembly of a material portion of U.S. bus shells in compliance with the Buy America regulations.  For example, if this new definition is applied by the FTA on October 22, 2007, against New Flyer’s existing bus contracts, it could result in a material proportion of the buses shipped by New Flyer to U.S. customers not being compliant under the new requirements.  The Company is in the process of assessing the potential interpretation, application, enforcement and impact of the new rules.  It is also evaluating potential changes to its operations in order to minimize disruptions to the production and delivery schedules.  Management believes that if the new rules were to permit a sufficient period of time to address the implications of the rules, the Company could reorganize production between its three production facilities in order to mitigate the effects of these new rules.

The Company is continuing to assess the alternatives available to it and is aggressively taking action together with other manufacturers to address this rule change.

The Company will provide an update to the public in respect of this matter when it obtains clarification from the FTA.

New Flyer is the leading manufacturer of heavy-duty transit buses in the United States and Canada and a leading provider of aftermarket services.  New Flyer has the broadest range of products in the heavy-duty transit bus industry and provides its products and services to the majority of the largest transit authorities in North America.

Forward-Looking Statements

This press release contains "forward-looking statements", which reflect the expectations of management regarding the Company's future growth, results of operations, performance and business prospects and opportunities. The words "believes", "anticipates", "plans", "expects", "intends", "projects", "estimates" and similar expressions are intended to identify forward-looking statements.  These forward-looking statements reflect management's current expectations regarding future events and operating performance and speak only as of the date of this press release.  Forward-looking statements involve significant risks and uncertainties, should not be read as guarantees of future performance or results, and will not necessarily be accurate indications of whether or not or the times at or by which such performance or results will be achieved.  Such differences may be caused by factors which include, but are not limited to, competition in the heavy-duty transit bus industry, availability of funding to the Company’s customers at current levels or at all, material losses and costs may be incurred as a result of product warranty costs, material losses and costs may be incurred as a result of product liability claims, the Company’s success depends on a limited number of key executives who the Company may not be able to adequately replace in the event that they leave the Company, the absence of fixed term customer contracts and the termination of contracts by customers for convenience, the current "Buy-America" legislation may change and/or become more onerous, production delays may result in liquidated damages under the Company’s contracts with its customers, currency fluctuations could adversely affect the Company’s financial results or competitive position in the industry, the Company may not be able to maintain performance bonds or letters of credit required by its contracts, third party debt service obligations may have important consequences to the Company, interest rates could change substantially and materially impact the Company’s profitability, the dependence on limited sources of supply and the Company’s profitability and performance can be adversely affected by increases in raw material and component costs. The Company cautions that this list of factors is not exhaustive. These factors and other risks and uncertainties are discussed in the Company's materials filed with the Canadian securities regulatory authorities and are available on SEDAR at www.sedar.com.

Although the forward-looking statements contained in this press release 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. These forward-looking statements are made as of the date of this press release and the Issuer and the Company assume no obligation to update or revise them to reflect new events or circumstances.

For further information, please contact:
New Flyer Industries Inc.
John Marinucci
President and Chief Executive Officer
Tel: 204-224-1251