Federal Transit Administration Maintains Existing Definition of “Final Assembly” - No Impact to New Flyer’s Operations

Winnipeg, Manitoba, Canada − September 26, 2007 − (TSX:NFI.UN) Further to the two releases issued on September 21, 2007, New Flyer Industries Inc. and New Flyer Industries Canada ULC (together, the “Company” or “New Flyer”) advises that the Federal Transit Administration (the “FTA”) has filed a correction with the United States Office of the Federal Register amending the rule change that it made to the Buy America definition of “final assembly” on September 20, 2007.  This correction will be published in the U.S. Federal Register on Friday September 28, 2007, and will be effective on October 22, 2007.

The incorrect rule which was inadvertently issued by the FTA on September 20, 2007, may have had a material adverse effect on the Company’s financial results.  The corrected rule however, codifies the existing “final assembly” definition set out in the “Dear Colleague letter” issued by the FTA on March 18, 1997, and under which New Flyer has since been producing buses.  As a result, the codification of this definition of “final assembly” in the Buy America rules will not affect the Company’s current production of bus shells for sale to U.S. customers.  The correct rule will have no impact on the Company’s current operations and the Company does not plan on making any changes to its current operations.

A copy of the correction to the definition of “final assembly” is available for public inspection prior to its publication on September 28, 2007, at the Office of the Federal Register in Washington, D.C.

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.
Glenn Asham
Chief Financial Officer
Tel: 204-224-1251