UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549


                                    FORM 11-K


(Mark One)

         [ X ]    ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE
                  SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED]


For the fiscal year end December 31, 1998

                                       OR


         [   ]    TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE
                  SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED]


For the transition period from       to
                               -----    -----

Commission file number 1-9618



                      NAVISTAR RETIREMENT ACCUMULATION PLAN
                      -------------------------------------
                            (Full Title of the Plan)




                       NAVISTAR INTERNATIONAL CORPORATION
                       ----------------------------------
                         455 North Cityfront Plaza Drive
                             Chicago, Illinois 60611

                 (Name of Issuer of the securities held pursuant
         to the plan and the address of its principal executive office)


<PAGE>

     PAGE 2
                              REQUIRED INFORMATION


         Navistar  Retirement  Accumulation  Plan  ("Plan")  is  subject  to the
Employee Retirement Income Security Act of 1974 ("ERISA"). Therefore, in lieu of
the  requirements  of Items  1-3 of Form  11-K,  the  financial  statements  and
schedules of the Plan as of December  31, 1998 and 1997,  and for the years then
ended,  which have been  prepared in  accordance  with the  financial  reporting
requirements of ERISA, are attached hereto as Appendix 1 and incorporated herein
by this reference.

                                    EXHIBITS
                                    --------


Exhibit Number                Description                              11-K Page
--------------                -----------                              ---------

      23                      Consent of Deloitte & Touche LLP            E-1


                                   SIGNATURES


         Pursuant to the  requirements  of the Securities  Exchange Act of 1934,
the Plan  Administrator  for the Plan has duly caused  this annual  report to be
signed on its behalf by the undersigned hereunto duly authorized.



                               Navistar Retirement Accumulation Plan
                               -------------------------------------
                               By:   Navistar International Transportation Corp.
                                     Plan Administrator


                                       By:    /s/ Mark T. Schwetschenau
                                              ------------------------------
                                       Name:      Mark T. Schwetschenau
                                       Title:     Vice President and Controller
                                                  (Principal Accounting Officer)


                                                  June 2, 1999


<PAGE>


                                                                      APPENDIX 1

NAVISTAR RETIREMENT ACCUMULATION PLAN
-------------------------------------

    TABLE OF CONTENTS                                                    Page
    -----------------                                                    ----

    INDEPENDENT AUDITORS' REPORT                                           1

    FINANCIAL STATEMENTS AS OF DECEMBER 31, 1998 AND 1997
    AND FOR THE YEARS THEN ENDED:
       Statements of Net Assets Available for Benefits                     2
       Statements of Changes in Net Assets
          Available for Benefits                                           3
       Notes to Financial Statements                                     4-10


    SUPPLEMENTAL SCHEDULES AS OF DECEMBER 31, 1998 AND
    FOR THE YEAR THEN ENDED:
       Schedule of Assets Held for Investment Purposes - Item 27(a)       11
       Schedule of Reportable Transactions - Item 27(d)                 12-13


    All other  schedules  are omitted  because of the absence of the
    conditions under which they are required.

--------------------------------------------------------------------------------


<PAGE>


INDEPENDENT AUDITORS' REPORT

Navistar International Transportation Corp:

We have audited the accompanying financial statements of the Navistar Retirement
Accumulation  Plan (the  "Plan") as of December  31, 1998 and 1997,  and for the
years then ended,  listed in the table of contents.  These financial  statements
are the  responsibility  of the  Plan's  management.  Our  responsibility  is to
express an opinion on these financial statements based on our audits.

We  conducted  our  audits  in  accordance  with  generally   accepted  auditing
standards.  Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement.  An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements.  An audit also includes
assessing the  accounting  principles  used and  significant  estimates  made by
management,  as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our  opinion,  such  financial  statements  present  fairly,  in all material
respects,  the net assets  available for benefits of the Plan as of December 31,
1998 and 1997 and the changes in net assets available for benefits for the years
then ended, in conformity with generally accepted accounting principles.

Our audits  were  conducted  for the  purpose of forming an opinion on the basic
financial statements taken as a whole. The accompanying  supplemental  schedules
listed in the table of contents are presented for purposes of complying with the
Department of Labor's Rules and Regulations  for Reporting and Disclosure  under
the Employee  Retirement Income Security Act of 1974 and are not a required part
of the basic financial statements. These schedules are the responsibility of the
Plan's  management.  Such  supplemental  schedules  have been  subjected  to the
auditing procedures applied in the audit of the basic 1998 financial  statements
and, in our opinion,  are fairly stated in all material respects when considered
in relation to the basic 1998 financial statements taken as a whole.


DELOITTE & TOUCHE LLP
May 14, 1999
Chicago, Illinois


                                     - 1 -


<PAGE>


NAVISTAR RETIREMENT ACCUMULATION PLAN
-------------------------------------

STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
AS OF DECEMBER 31, 1998 AND 1997
--------------------------------


ASSETS                                                     1998          1997
------                                                     ----          ----

INVESTMENTS:
  Navistar Pooled Stock Master Trust Fund  -
    at market value  (1998 - 59,374 units of
    participation, cost $377,259, and  1997 -
    21,643 units of participation, cost $122,450)       $  445,304    $  142,410
  American Express Trust Collective Income Fund II -
    at market value (1998 - 10,440 shares,
    cost $186,344, and 1997 - 12,411 shares,
    cost $214,271)                                         192,630       219,663
  American Express Trust Equity Index Fund -
    at market value (1998 - 31,105 shares,
    cost $907,254, and 1997 - 8,879 shares,
    cost $219,017)                                       1,089,170       241,973
  IDS Selective Fund (Y) -
    at market value (1998 - 34,088 shares,
    cost $315,330, and 1997 - 7,537 shares,
    cost $69,103)                                          316,128        69,193
  IDS New Dimensions Fund (Y) -
    at market value (1998 - 40,233 shares,
    cost $1,036,093, and 1997 - 15,428 shares,
    cost $370,122)                                       1,160,524       368,141
  Templeton Foreign Fund -
    at market value (1998 - 34,776 shares,
    cost $341,382, and 1997 - 13,169 shares,
    cost $147,440)                                         291,773       131,028
  Frank Russell Aggressive Balanced Fund -
    at market value  (1998 - 89,047 shares,
    cost $1,142,362, and 1997 - 18,101  shares,
    cost $198,372)                                      1,335,086        229,480
  Participant loans                                       123,667         56,219
                                                       ----------     ----------
          Total investments                             4,954,282      1,458,107


  RECEIVABLES:

  Participant pre-tax contributions                        78,991         25,014
  Employer discretionary retirement contributions       1,873,915        701,483
  Employer matching contributions                         109,355         34,841
                                                       ----------     ----------

          Total receivables                             2,062,261        761,338
                                                       ----------     ----------

  NET ASSETS AVAILABLE FOR BENEFITS                    $7,016,543     $2,219,445
                                                       ==========     ==========

See notes to financial statements.

--------------------------------------------------------------------------------


                                     - 2 -


<PAGE>


NAVISTAR RETIREMENT ACCUMULATION PLAN
-------------------------------------

STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE YEARS ENDED DECEMBER 31, 1998 AND 1997
----------------------------------------------

                                                           1998          1997
                                                           ----          ----
ADDITIONS TO NET ASSETS:
------------------------

Investment income:
  Net realized/unrealized appreciation
    in fair value of investments                      $   485,877    $    65,270
  Interest and dividend income                            121,269         43,178
                                                       ----------     ----------
    Total investment income                               607,146        108,448

Contributions:
   Participant pre-tax contributions                    1,006,190        184,576
   Employer discretionary retirement contributions      1,898,353        701,483
   Employer matching contributions                        282,730         65,037
                                                       ----------     ----------
    Total contributions                                 3,187,273        951,096

Rollovers from other qualified plans                      996,135        700,145
Transfers from other qualified plans - net                 46,828        293,949
                                                       ----------     ----------

    Total additions to net assets                       4,837,382      2,053,638
                                                       ----------     ----------

DEDUCTIONS FROM NET ASSETS:
Benefits paid to participants                              40,284          2,741
                                                       ----------     ----------
    Total deductions from net assets                       40,284          2,741
                                                       ----------     ----------

    Net increase                                        4,797,098      2,050,897

NET ASSETS AVAILABLE FOR BENEFITS:
   BEGINNING OF YEAR                                    2,219,445        168,548
                                                       ----------     ----------

   END OF YEAR                                         $7,016,543     $2,219,445
                                                       ==========     ==========

See notes to financial statements.

--------------------------------------------------------------------------------


                                     - 3 -


<PAGE>


NAVISTAR RETIREMENT ACCUMULATION PLAN
-------------------------------------


NOTES TO FINANCIAL STATEMENTS FOR THE YEARS
ENDED DECEMBER 31, 1998 AND 1997
--------------------------------

 1.      DESCRIPTION OF THE PLAN

         The following description of the Navistar Retirement  Accumulation Plan
         (the "Plan")  provides only general  information.  Participants  should
         refer to the Plan  document  for a complete  description  of the Plan's
         provisions.

         General   -  The   Plan  is   sponsored   by   Navistar   International
         Transportation  Corp. (the "Company") to provide savings and retirement
         benefits for certain eligible salaried  employees of the Company and of
         certain of its  affiliates  that are  participating  under the Plan who
         were  first  hired on or after  January  1,  1996 and who meet  certain
         length of service  requirements.  The Plan was  established  January 1,
         1996, and has subsequently been amended to maintain qualification under
         Sections  401(a),  401(k) and 501 of the Internal  Revenue Code of 1986
         (the "Code") and to modify the  provisions of the Plan.  Administrative
         expenses  relating  to the Plan are  paid by the  Company.  The Plan is
         subject to the provisions of the Employee  Retirement  Income  Security
         Act of 1974 ("ERISA").

         The Trustee,  American  Express Trust, is authorized to hold and invest
         the assets of the Plan in accordance  with the  provisions of the Trust
         Agreement between the Company and the Trustee.

         Contributions - Contributions may be made to the Plan only on a pre-tax
         basis.  Pre-tax salary reduction  contributions to the Plan are subject
         to  annual  maximum  limits  equal to the  lesser  of 15  percent  of a
         participant's  annual  compensation  or  a  prescribed  dollar  amount,
         indexed for inflation ($10,000 for 1998, and $9,500 for 1997).  Subject
         to Company  approval,  certain  eligible  employees are allowed to make
         rollover  contributions  to the  Plan,  if such  contributions  satisfy
         applicable   regulations.   Such  employees  are  not  required  to  be
         participants in the pre-tax salary reduction portion of the Plan and no
         pre-tax salary reduction  contributions  may be made until such time as
         such  employees  would  otherwise  become  eligible  to  and  do  elect
         participation in that portion of the Plan.

         The  Plan  permits  the  Company  to make  matching  and  discretionary
         contributions.  Company matching and  discretionary  contributions  are
         subject to a vesting  schedule based upon the  participant's  length of
         employment,  and fully vest upon  completion  of five years of service.
         The  Company  matches 50  percent  of the first 6 percent  of  eligible
         compensation  deferred  by the  participant.  Discretionary  retirement
         contributions   are   allocated  to  eligible   members  based  on  the
         participant's age at year-end and eligible compensation.

         Non-vested   Company  matching  and  discretionary   contributions  are
         forfeited  when a  participant  retires  or  terminates  service.  Such
         forfeitures  are used to offset future  Company  contributions.  Salary
         reduction  contributions  and rollover  contributions  are fully vested
         immediately.


                                     - 4 -


<PAGE>


1.       DESCRIPTION OF THE PLAN (continued)

         Investment  Options - Participants  may direct the investment  of their
         pre-tax salary reduction and rollover account assets as follows:



         o   American  Express Trust  Collective  Income Fund II is a collective
             investment fund  which invested in a diversified pool of investment
             contracts  varying  in maturity date, size and yield and short-term
             cash instruments.

         o   American Express Trust Equity Index Fund is a collective investment
             fund which  invested  primarily in nearly all of the same stocks as
             are in the Standard & Poor's 500 stock index.

         o   IDS  Selective Fund (Y) is a  mutual fund which invested  primarily
             in  investment  grade  corporate  bonds,   government   bonds,  and
             other  debt securities.

         o   IDS  New  Dimensions  Fund (Y) is  a  mutual  fund  which  invested
             primarily in common stocks of United States companies.

         o   Templeton  Foreign Fund is  a mutual fund which invested  primarily
             in common stocks and other  securities of companies and governments
             outside the United States.

         o   Navistar International  Corporation Common  Stock  Pooled Fund is a
             pool  consisting  primarily of Navistar  International  Corporation
             Common Stock and  a small amount of  short-term  cash  investments.
             Navistar  International Corporation  ("Navistar") is the parent of
             the Company.

             The shares  of Navistar International  Corporation and the units of
             a money  market fund are pooled in a master  trust and  represented
             by units of the Navistar Stock Pool (the "Pool"). The value of each
             unit of the  Pool is  represented  in terms  of "net  asset  value"
             ("NAV").  The  NAV per unit of the Pool is  determined  by dividing
             the  value  of  all  assets  of the  Pool by the  total  number  of
             outstanding units of the Pool.

             The  plans participating in the master trust are allocated units of
             the Pool  based on their  respective  percent interest and share in
             the assets  of the Pool,  investment  income generated by assets of
             the Pool, and  the gains/losses of the assets of the Pool by way of
             the  increase/decrease  of the  NAV of  each  participating  plan's
             allocated units of the Pool. Except  that each  participating  plan
             may   hold  a  different   number  of  units  of  the  Pool,   each
             participating   plan  shares  equally in the assets and  investment
             experience  of  the Pool since the same NAV applies to all units of
             the Pool.

             The participating plans in the Master Trust Fund and their  percent
             interest as of December 31, 1998 are as follows:

               Navistar International Transportation Corp.
               401(k) Retirement Savings Plan                         70.2%

               Navistar International Transportation Corp.
               401(k) Plan for Represented Employees                  25.9%

               Navistar Retirement Accumulation Plan                   3.9%


                                     - 5 -


<PAGE>


1.       DESCRIPTION OF THE PLAN (continued)

         The following  table  presents the carrying value of investments of the
         Master Trust Fund as of December  31, 1998 and 1997 and the  components
         of investment income for the two years then ended.

                                                          1998          1997
                                                          ----          ----

           Cash and cash equivalents                  $   176,042   $   148,796
           Navistar International Corporation
             Common Stock                              11,177,596     5,338,075
                                                      -----------   -----------
           Total investments                          $11,353,638   $ 5,486,871
                                                      ===========   ===========

           Net realized/unrealized appreciation
             in fair value of investments             $ 1,298,552   $ 2,176,820
           Interest and dividend income                    14,174         5,081
                                                      -----------   -----------
           Total investment income                    $ 1,312,726   $ 2,181,901
                                                      ===========   ===========

         Investment of Company  Matching and  Discretionary  Contributions - The
         Company  controls the  investment of these  contributions.  The Company
         employs professional  investment  managers,  as selected by the Pension
         Fund  Investment  Committee of the Company,  to manage such  investment
         portfolio.  It is  intended  that  the  assets  will be  invested  on a
         long-term  basis,  consistent  with the  purpose of the Plan to provide
         retirement benefits.  Such Plan assets for the years ended December 31,
         1998 and 1997 were invested in  the Frank Russell  Aggressive  Balanced
         Fund, a mutual fund which  invested in common  stocks of United  States
         and foreign companies and in intermediate bonds.

         Participant Accounts - Contributions and assets allocated to a specific
         investment fund are commingled with those of other participants and are
         invested in accordance  with the nature of the specific fund.  Realized
         gains  and  losses,  unrealized  appreciation  and  depreciation,   and
         dividends  and interest are  allocated to  participants  based on their
         proportionate  share of the funds.  Fund  managers' fees are charged to
         participants'  accounts  as a  reduction  of the return  earned on each
         investment option.

         Loans to  Participants  -  Participants  may  borrow  from  their  fund
         accounts a minimum  of $1,000 up to the  lesser of 50% of their  vested
         account  balance  or  $50,000.   Company  matching  and   discretionary
         contributions  are not  available  for  loans.  Loan  transactions  are
         treated as a transfer  between the applicable  investment funds and the
         loan fund.  Loan terms range from 1 to 5 years,  with the  exception of
         loans made for the  purchase  of a principal  residence,  which must be
         repaid in installments  over a period of up to ten years. The loans are
         secured by the balance in the  participant's  account and bear interest
         at a rate commensurate with local prevailing rates as determined by the
         Plan Administrator.

         Payment of Benefits - Participants  may request either an in-service or
         hardship  withdrawal of certain of their account  assets.  Participants
         may only withdraw  authorized  pre-tax salary  reduction  contributions
         after  attaining age 59-1/2,  or on a hardship basis prior to attaining
         age  59-1/2.  Company  matching  and  discretionary  contributions  and
         investment earnings thereon are not eligible for in-service withdrawal.

         A  participant's   vested  account  is  distributable  at  the  time  a
         participant  separates from service with the Company,  suffers  a total
         and permanent disability or dies.


                                     - 6 -


<PAGE>


1.       DESCRIPTION OF THE PLAN (continued)

         When the participant terminates  employment,  the vested portion of the
         account will be  distributed  if the asset value is $5,000 or less.  If
         the asset value is more than $5,000,  the participant has the option of
         receiving the account upon  separation  or deferring  receipt until age
         65. Accounts are  distributed in a single sum. If the account  includes
         100 or more shares of Navistar Common Stock,  the  distribution of that
         portion  of the  account  will be made in the  form of full  shares  of
         Common Stock and a cash payment for any fractional shares. For accounts
         with less than 100 shares of Navistar  Common Stock,  the  distribution
         will be made in cash.

2.       SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

         Basis  of  Presentation  - The  financial  statements  of the  Plan are
         presented on the accrual basis of accounting.

         Use  of  Estimates  -  The  preparation  of  financial   statements  in
         conformity  with  generally  accepted  accounting  principles  requires
         management to make estimates and  assumptions  that affect the reported
         amounts of assets and liabilities  and disclosure of contingent  assets
         and  liabilities  at the  date  of the  financial  statements  and  the
         reported amounts of revenues and expenses during the reporting  period.
         Actual results could differ from those estimates.

         Investment  Valuation and Income  Recognition  - Participant  loans are
         valued at cost which  approximates  market value. All other investments
         are presented at published  market values.  Security  transactions  are
         accounted  for on the trade  date.  Dividend  income is  accrued on the
         ex-dividend date.

         Unrealized appreciation or depreciation on investments is determined by
         comparing  the  fair  value  of these  separate  funds  at the  current
         year-end,   net  of  contributions  made  during  the  year,  to  their
         respective  fair values at the preceding  year-end.  Realized  gains or
         losses are determined by comparing net sales proceeds to the fair value
         of the investment at the preceding year-end.

         Participant  Withdrawals  - As of December  31, 1998 and  December  31,
         1997, there were no benefits which were due to former  participants who
         have withdrawn from  participation  in the Plan.  Benefits are recorded
         when paid.

3.       TAX STATUS OF THE PLAN

         Application has not yet been made to the Internal Revenue Service for a
         determination  letter as to whether the Plan  qualified  under Sections
         401(a) and 401(k) of the Code.  The Company  believes  that the Plan is
         currently designed and being operated in compliance with the applicable
         requirements of the Code and thus the Plan and related trust are exempt
         from federal  income taxes under  Section  501(a) of the Code as of the
         financial statement date.  Therefore,  no provision for income taxes is
         included in the Plan's financial statements.

                                     - 7 -


<PAGE>


4.       AMENDMENT OR TERMINATION OF THE PLAN

         Although  the Company  expects to continue the Plan  indefinitely,  the
         Company,  at its  discretion,  reserves  the  right to  amend,  modify,
         suspend or  terminate  the Plan,  provided  that no such  action  shall
         deprive any person of any rights to contributions  made under the Plan.
         If the Plan is terminated or contributions thereto have been completely
         discontinued, the rights of all participants to the amounts credited to
         their  accounts  shall  be  non-forfeitable  and the  interest  of each
         participant in the funds will be distributed to such participant or his
         or her  beneficiary in accordance with the Plan terms and ERISA. If the
         Plan is terminated,  Plan  participants will become fully vested in any
         funds allocated to them.

5.       INVESTMENTS EXCEEDING 5 PERCENT OF NET ASSETS

         The Plan's investments which exceeded 5 percent of net assets available
         for benefits as of December 31, 1998 and 1997 are as follows:

                                                          1998           1997
                                                          ----           ----
         Navistar Pooled Stock
           Master Trust Fund                           $  445,304     $  142,410
         American Express Trust
           Collective Income Fund II                         *           219,663
         American Express Trust
           Equity Index Fund                            1,089,170        241,973
         IDS New Dimensions Fund (Y)                    1,160,524        368,141
         Templeton Foreign Fund                              *           131,028
         Frank Russell Aggressive Balanced Fund         1,335,086        229,480


         *This investment did not exceeed 5 percent of  the net assets available
          for benefits as of December 31, 1998.

                                     - 8 -


<PAGE>


6.       BY FUND INFORMATION

         Investment income,  participant  pre-tax contributions,  benefits  paid
         to participants and  transfers from  other qualified plans, by separate
         investment fund,  are as follows for the years ended  December 31, 1998
         and 1997.

                                                         1998          1997
                                                         ----          ----
         Net realized/unrealized  appreciation
          (depreciation) in fair value of investments:
             Navistar Pooled Stock
               Master Trust Fund                       $   57,959    $  25,236
             American Express Trust
               Collective Income Fund II                    6,845        1,617
             American Express Trust
               Equity Index Fund                          163,883       23,334
             IDS Selective Fund (Y)                           785          114
             IDS New Dimensions Fund (Y)                  135,787          481
             Templeton Foreign Fund                       (45,700)     (15,937)
             Frank Russell Aggressive
               Balanced Fund                              171,457       31,278
                                                       ----------    ---------
         Total                                         $  491,016    $  66,123
                                                       ==========    =========

         Interest and dividend income:
             Navistar Pooled Stock
               Master Trust Fund                       $    2,279    $    (514)
             American Express Trust
               Collective Income Fund II                      309            1
             American Express Trust
               Equity Index Fund                              125          172
             IDS Selective Fund (Y)                        13,824        2,287
             IDS New Dimensions Fund (Y)                   68,242       27,941
             Templeton Foreign Fund                        31,334       12,980
             Frank Russell Aggressive
               Balanced Fund                                5,156          311
                                                       ----------    ---------
         Total                                         $  121,269    $  43,178
                                                       ==========    =========

         Participant pre-tax contributions:
             Navistar Pooled Stock
               Master Trust Fund                       $   67,359    $   6,342
             American Express Trust
               Collective Income Fund II                   64,860       12,031
             American Express Trust
               Equity Index Fund                          294,455       52,679
             IDS Selective Fund (Y)                        66,817       12,355
             IDS New Dimensions Fund (Y)                  371,556       67,573
             Templeton Foreign Fund                       141,143       33,596
                                                       ----------   ----------
         Total                                         $1,006,190   $  184,576
                                                       ==========   ==========


         Benefits paid to participants:
             Navistar Pooled Stock
               Master Trust Fund                       $    1,194   $        -
             American Express Trust
               Collective Income Fund II                      351            -
             American Express Trust
               Equity Index Fund                            8,141        1,842
             IDS Selective Fund (Y)                           901            -
             IDS New Dimensions Fund (Y)                   18,388          899
             Templeton Foreign Fund                         7,838            -
             Participant loans                              3,471            -
                                                       ----------   ----------
         Total                                         $   40,284   $    2,741
                                                       ==========   ==========


                                     - 9 -


<PAGE>


6.       BY FUND INFORMATION (continued)

                                                           1998         1997
                                                           ----         ----

         Transfers from other qualified plans - net:
           Navistar Pooled Stock
             Master Trust Fund                         $    1,092   $   83,730
           American Express Trust
             Collective Income Fund II                        490        5,748
           American Express Trust
             Equity Index Fund                              3,211       65,765
           IDS Selective Fund (Y)                           1,734       21,802
           IDS New Dimensions Fund (Y)                     17,376       75,548
           Templeton Foreign Fund                          16,922       36,979
           Participant loans                                6,003        4,377
                                                       ----------   ----------
         Total                                         $   46,828   $  293,949
                                                       ==========   ==========


         Rollovers from other qualified plans:
           Navistar Pooled Stock
             Master Trust Fund                         $   64,578   $   52,317
           American Express Trust
             Collective Income Fund II                     13,672      199,062
           American Express Trust
             Equity Index Fund                            401,796       90,801
           IDS Selective Fund (Y)                         128,527       36,702
           IDS New Dimensions Fund (Y)                    316,194      239,012
           Templeton Foreign Fund                          71,368       82,251
                                                       ----------   ----------
         Total                                         $  996,135   $  700,145
                                                       ==========   ==========


                                     - 10 -


<PAGE>
<TABLE>
<CAPTION>
NAVISTAR RETIREMENT ACCUMULATION PLAN
-------------------------------------

SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES - ITEM 27(a), DECEMBER 31, 1998
-------------------------------------------------------------------------------

                                                        DESCRIPTION OF INVESTMENT,
                                                        INCLUDING MATURITY DATE,
          IDENTITY OF ISSUE, BORROWER,                  RATE OF INTEREST, COLLATERAL,
(1)       LESSOR OR SIMILAR PARTY                       PAR OR MATURITY VALUE                          COST            MARKET VALUE
          -----------------------------------------     --------------------------------------         ----            ------------
<S>       <S>                                           <S>                                        <C>                  <C>

 *        Navistar Pooled Stock Master Trust Fund       59,374 units of participation              $ 377,259            $ 445,304

          American Express Trust
            Collective Income Fund II                   10,440 shares of beneficial                  186,344              192,630
                                                          interest, collective investment fund

          American Express Trust Equity Index Fund      31,105 shares of beneficial                  907,254            1,089,170
                                                          interest, collective investment fund

          IDS Selective Fund (Y)                        34,088 shares of beneficial                  315,330              316,128
                                                          interest, mutual fund

          IDS New Dimensions Fund (Y)                   40,233 shares of beneficial                1,036,093            1,160,524
                                                          interest, mutual fund

          Templeton Foreign Fund                        34,776 shares of beneficial                  341,382              291,773
                                                          interest, mutual fund

          Frank Russell Aggressive Balanced Fund        89,047 shares of beneficial                1,142,362            1,335,086
                                                          interest, mutual fund

          Participant Loans                             Interest rates ranging from                  123,667              123,667
                                                          8.16% - 9.50%, (maturing                ----------           ----------
                                                          2000 through 2008)

          TOTAL INVESTMENTS                                                                       $4,429,691           $4,954,282
                                                                                                  ==========           ==========

<FN>
(1)  An asterisk indicates a party-in-interest.
</FN>
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>

                                     - 11 -


<PAGE>
<TABLE>
<CAPTION>
NAVISTAR RETIREMENT ACCUMULATION PLAN
-------------------------------------

SCHEDULE OF REPORTABLE TRANSACTIONS - ITEM 27(d)
YEAR ENDED DECEMBER 31, 1998
------------------------------------------------


Single Transactions Exceeding 5% of Value:
                                                                 Number       Number
                                               Description         of          of
        Identity of Issue                       of Asset        Purchases     Sales     Purchases         Sales         Net Gain
---------------------------------------       -------------     ---------     -----     ---------         -----         --------
<S>                                           <S>                  <C>          <C>     <C>              <C>            <C>

IDS New Dimensions Fund (Y)                   Mutual Fund           1                   $   75,364

IDS New Dimensions Fund (Y)                   Mutual Fund                        1                       $131,527       $  1,625

American Express Trust                        Collective
  Equity Index Fund                           Investment Fund       1                       87,456

Navistar Pooled Stock
  Master Trust Fund                           Company Stock         1                      131,527

Frank Russell Aggressive                      Mutual Fund           2                      774,196


Series of Transactions with the Same Broker Exceeding 5% of Value:

                                                                  Number      Number
                                               Description         of          of
        Identity of Issue                       of Asset        Purchases     Sales     Purchases         Sales         Net Gain
---------------------------------------       -------------     ---------     -----     ----------        -----         --------

Navistar Pooled Stock Master Trust Fund       Company Stock        56                   $  298,891

Navistar Pooled Stock Master Trust Fund       Company Stock                     11                      $  352,851      $  9,872

Frank Russell Aggressive Balanced Fund        Mutual Fund          29                    1,077,774

Frank Russell Aggressive Balanced Fund        Mutual Fund                       45                          82,181         9,843
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>

                                     - 12 -


<PAGE>
<TABLE>
<CAPTION>
NAVISTAR RETIREMENT ACCUMULATION PLAN
-------------------------------------

SCHEDULE OF REPORTABLE TRANSACTIONS - ITEM 27(d)
YEAR ENDED DECEMBER 31, 1998
------------------------------------------------

Series of Transactions in Same Security Exceeding 5% of Value:

                                                                  Number      Number
                                               Description         of          of                                       Net Gain
        Identity of Issue                       of Asset        Purchases     Sales     Purchases         Sales          (Loss)
---------------------------------------       -------------     ---------     -----     ---------         -----         --------
<S>                                           <S>                   <C>         <C>     <C>               <C>           <C>
IDS New Dimensions Fund (Y)                   Mutual Fund           85                  $  754,518

IDS New Dimensions Fund (Y)                   Mutual Fund                       22                       $ 97,922       $  9,378

IDS Selective Fund (Y)                        Mutual Fund           76                     259,440

IDS Selective Fund (Y)                        Mutual Fund                       15                         13,292             79

American Express Trust                        Collective
  Collective Income Fund II                   Investment Fund       43                     121,551

American Express Trust                        Collective
  Collective Income Fund II                   Investment Fund                   19                        151,736          2,261

American Express Trust                        Collective
  Equity Index Fund                           Investment Fund       80                     704,555

American Express Trust                        Collective
  Equity Index Fund                           Investment Fund                   18                         21,240          4,923

Navistar Pooled Stock
  Master Trust Fund                           Company Stock         56                     298,891

Navistar Pooled Stock
  Master Trust Fund                           Company Stock                     11                         53,960          9,872

Templeton Foreign Fund                        Mutual Fund           53                     254,458

Templeton Foreign Fund                        Mutual Fund                       19                         48,011        (12,503)

Frank Russell Aggressive
  Balanced Fund                               Mutual Fund           29                     998,279

Frank Russell Aggressive
  Balanced Fund                               Mutual Fund                       45                         64,131          9,843
<FN>
Note:    The above list of reportable transactions, provided by American Express
         Trust,   was   determined   by  comparing  the  current  value  of  the
         transactions,  or series of transactions,  on the transaction  date(s),
         with  5  percent of  the  current  value  of  the  Trust  assets at the
         beginning of the Plan year;  and, as  such,  may  include  transactions
         which  represent  5 percent of  the  assets  of  the Trust, but may not
         represent transactions which represent 5 percent of Plan assets.
</FN>
--------------------------------------------------------------------------------
</TABLE>
                                     - 13 -