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MCI To Cease Distributing Daimler’s Setra Coaches

January 4, 2018 | New Flyer

DES PLAINES, ILLINOIS, JANUARY 4, 2018 – (TSX: NFI) Motor Coach Industries, Inc. (“MCI”), the U.S. subsidiary of New Flyer Industries Inc. (“NFI Group”), the largest transit bus and motor coach manufacturer and parts distributor in North America, announced today that EvoBus GmBH (“Daimler”) has terminated the distribution rights agreement (“DRA”) for German built Setra motor coaches in the United States and Canada effective June 29, 2018.

Under previous private equity ownership, MCI entered into the DRA as part of a transaction that resulted in Daimler owning 10% of the equity of MCI in 2012. When New Flyer acquired 100% of the equity of MCI in December 2015, the DRA remained in place. The models covered by the agreement were the Setra S 407 and S 417 motor coaches, introduced by Daimler in North America in 2003. Since 2012, MCI has sold only 282 new Setra coaches.

Daimler advised MCI their decision was based on its belief that MCI’s own competing motor coach models did not allow for sufficient attention to the Setra brand in Canada and the US. The decision comes as MCI is expanding its own motor coach lineup and service network. Among recent moves, MCI has redesigned its best-selling J4500 model, has recently introduced a new 35-foot coach, its fully accessible D45 CRT LE commuter coach, and has announced plans to introduce a battery-electric motor coach by 2020.

Sales of new Setra coaches will transfer to Daimler’s new North American distributor immediately, while parts sales, service and warranty support for Setra coaches in service will remain with MCI and then transfer mid-2018. Under the terms of the DRA and as part of the transition, Daimler will re-purchase all new Setra coaches and service parts inventory on hand at MCI.

“We appreciated our relationship with Daimler, and will fully support the DRA transition for our mutual customers. Most importantly, we will continue to focus on building our industry leading MCI coach brand, along with offering service and parts support for operators throughout North America,” said Patrick Scully, MCI Executive Vice President Sales and Marketing.

About NFI Group

NFI Group and its subsidiaries comprise the largest bus and motor coach manufacturer and parts distributor in North America, with 32 fabrication, manufacturing, distribution, and service centers located across Canada and the United States and employing nearly 6,000 team members.

NFI Group provides a comprehensive suite of mass transportation solutions under several brands: New Flyer® (heavy-duty transit buses), ARBOC® (low-floor cutaway and medium-duty buses), MCI® (motor coaches), and NFI Parts™ (bus and coach parts, support, and service). NFI Group’s vehicles incorporate the widest range of drive systems available, ranging from clean diesel, natural gas, diesel-electric hybrid, trolley-electric, battery-electric and fuel cell.

  • New Flyer is North America's heavy-duty transit bus leader and offers the most advanced product line under the Xcelsior® and Xcelsior CHARGE™ brands. New Flyer actively supports over 44,000 heavy-duty transit buses (New Flyer, NABI, and Orion) currently in service, of which 6,400 are powered by electric and battery propulsion.
  • ARBOC is North America’s low-floor, body-on-chassis (“cutaway”) bus leader serving transit, paratransit, and shuttle applications. With more than 2,500 buses in service, ARBOC leads the low-floor cutaway bus market providing unsurpassed passenger accessibility and comfort over traditional high-floor cutaway vehicles. ARBOC also offers a medium-duty bus for transit and shuttle applications.
  • Motor Coach Industries is North America’s motor coach leader, offering the J-Series, the industry’s best-selling intercity coach for 11 consecutive years, and the D-Series, the industry’s best-selling motor coach line in North American history. MCI actively supports over 28,000 coaches currently in service.
  • NFI Parts is North America's most comprehensive parts organization, providing replacement parts, technical publications, training, service, and support for NFI Group’s bus and motor coach product lines.

Further information is available at www.newflyer.com, www.arbocsv.com, and www.mcicoach.com. The common shares of NFI Group are traded on the Toronto Stock Exchange under the symbol NFI.

Forward-Looking Statements

This press release may contain forward-looking statements relating to expected future events and financial and operating results of NFI Group that involve risks and uncertainties. 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. Actual results may differ materially from management expectations as projected in such forward-looking statements for a variety of reasons, including those 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, NFI Group 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.

For further information, please contact:

Patricia Plodzeen, MCI Public Relations,                         Jon Koffman, New Flyer Investor Relations
Tel: 847-283-0883                                                                 Tel: 320-316-4964
E-mail: pat.plodzeen@mcicoach.com                             E-mail: investor@newflyer.com