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

                              FORM 10-Q


      X  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                   SECURITIES EXCHANGE ACT OF 1934

            For the quarterly period ended June 30, 2002

                                 OR

            TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                   SECURITIES EXCHANGE ACT OF 1934

              For the transition period from N/A to N/A


                    Commission File Number  1-12149


                CONSOLIDATED FREIGHTWAYS CORPORATION


                Incorporated in the State of Delaware
            I.R.S. Employer Identification No. 77-0425334

               16400 S.E. CF Way, Vancouver, WA  98683
                   Telephone Number (360) 448-4000

Indicate  by  check  mark whether the registrant (1)  has  filed  all
reports  required  to  be  filed by  Sections  13  or  15(d)  of  the
Securities  Exchange Act of 1934 during the preceding 12  months  (or
for such shorter period that the registrant was required to file such
reports),  and  (2) has been subject to such filing requirements  for
the past 90 days.  Yes   X     No     .




          Number of shares of Common Stock, $.01 par value,
             outstanding as of July 31, 2002: 22,442,514




                    CHAPTER 11 BANKRUPTCY FILINGS

     On  September  3, 2002, Consolidated Freightways Corporation,  a
Delaware corporation ("CFC"), Consolidated Freightways Corporation of
Delaware, a Delaware corporation ("CFCD"), CF AirFreight Corporation,
a  Delaware corporation ("CF AirFreight"), Redwood Systems,  Inc.,  a
Delaware  corporation  ("Redwood  Systems"),  Leland  James   Service
Corporation,   a  Delaware  corporation  ("Leland  James")   and   CF
MovesU.com    Incorporated,   a   Delaware   corporation    ("CFMU"),
(collectively,  the "Debtors"), intend to file petitions  for  relief
under Chapter 11 of the United States Bankruptcy Code ("Chapter  11")
in  the  United States Bankruptcy Court for the Central  District  of
California.  The Debtors required substantial additional  sources  of
financing  in order to satisfy their obligations in a timely  manner.
The   Debtors  had  discussions  under  way  with  existing  lenders,
investors  and  other sources to obtain the additional financing  the
Debtors needed to continue operations.  The Debtors have been  unable
to secure sufficient additional financing to continue operations.  In
particular, the Chapter 11 filing is necessary because one  of  CFC's
surety  bondholders  cancelled  coverage  relating  to  CFC's   self-
administered   insurance  programs  for  workers'  compensation   and
vehicular casualty.  This negatively impacted the pending discussions
with all lenders and investors.  Ultimately, CFC was unable to secure
financing  and  to  bridge the surety bond gap, at  which  point  the
situation became critical.  Moreover, the Debtors anticipated that  a
second  insurer would also cancel coverage.  The Board  of  Directors
reluctantly concluded that the Debtors could not continue to operate,
pay  employees and meet its obligations.  The Debtors  will  ask  the
bankruptcy court to allow them to oversee their operations as debtors
in  possession,  subject  to court approval of  matters  outside  the
ordinary  course of business.  While in Chapter 11, the Debtors  will
attempt  a  management-directed sale of the Debtors'  business  as  a
going concern.  In the event such a sale is not possible, the Debtors
will   attempt  to  sell  portions  of  the  business   in   separate
transactions  and  to  liquidate and collect  the  remainder  of  the
Debtors' assets.  The Debtors have engaged an investment banking firm
to  assist in the sale.  All such sales will attempt to maximize  the
value  of  the  Debtors'  assets for  the  benefit  of  the  Debtors'
creditors.  CFC believes that the Debtors will not be able  to  fully
satisfy  the claims of the creditors from the proceeds of such  sales
and  liquidations.   Therefore, CFC believes that CFC's  stockholders
will not receive any distributions on account of their stock.

     On  September 2, 2002, CFC, CFCD, Redwood Systems, Leland  James
and  CFMU sent notices of termination to approximately 15,500  active
employees and effectively ceased all operations except those  limited
operations  necessary  to  protect  the  Debtors'  assets.   Canadian
Freightways Ltd. and subsidiaries and Grupo Consolidated Freightways,
S.A.  de RL, as well as several non-operating subsidiaries, have  not
terminated  their employees and are continuing their normal  business
operations.   These entities will not be included in  the  bankruptcy
filings.  CF AirFreight, although included in the bankruptcy  filing,
did  not  terminate any employees and will continue  normal  business
operations.




                 CONSOLIDATED FREIGHTWAYS CORPORATION
                              FORM 10-Q
                     Quarter Ended June 30, 2002

_____________________________________________________________________

_____________________________________________________________________


                                INDEX



  PART I.  FINANCIAL INFORMATION                          Page

   Item 1.     Financial Statements (Unaudited)

          Consolidated Balance Sheets -
            June 30, 2002 and December 31, 2001                     4

          Statements of Consolidated Operations -
            Three and Six Months Ended June 30, 2002 and 2001       6

          Statements of Consolidated Cash Flows -
            Six Months Ended June 30, 2002 and 2001                 7

          Notes to Consolidated Financial Statements                8

  Item 2. Management's Discussion and Analysis of
            Financial Condition and Results of Operations          17

  Item 3. Quantitative and Qualitative Disclosures
             About Market Risk                                     25

  Item 4. Controls and Procedures                                  25

PART II.    OTHER INFORMATION

  Item 1. Legal Proceedings                                        26

  Item 4. Submission of Matters to a Vote of Security Holders      26

  Item 5. Stockholder Proposals                                    26

  Item 6. Exhibits and Reports on Form 8-K                         27


SIGNATURES                                                         28

CERTIFICATIONS                                                     29


                         PART I. FINANCIAL INFORMATION
                          ITEM 1. Financial Statements

                       CONSOLIDATED FREIGHTWAYS CORPORATION
                                 AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
                                  (Unaudited)


                                                     June  30,      December 31,
                                                       2002           2001
                                                      (Dollars in thousands)

ASSETS

CURRENT ASSETS
   Cash and cash equivalents                        $   10,834     $   28,067
   Trade accounts receivable, net of allowances        286,626        292,851
   Other receivables                                     6,215          6,045
   Operating supplies, at lower of average
     cost or market                                      5,863          6,670
   Prepaid expenses                                     44,605         35,772
   Deferred income taxes                                    --         59,897
      Total Current Assets                             354,143        429,302

PROPERTY, PLANT AND EQUIPMENT, at cost
   Land                                                 85,531         87,024
   Buildings and improvements                          342,210        353,102
   Revenue equipment                                   501,566        519,546
   Other equipment and leasehold improvements          164,558        158,963
                                                     1,093,865      1,118,635
   Accumulated depreciation and amortization          (764,443)      (761,044)
                                                       329,422        357,591
OTHER ASSETS
   Deposits and other assets                           100,008         93,687
   Deferred income taxes                                    --             --
                                                       100,008         93,687

TOTAL ASSETS                                        $  783,573     $  880,580



     The accompanying notes are an integral part of these statements.


                        CONSOLIDATED FREIGHTWAYS CORPORATION
                                  AND SUBSIDIARIES
                             CONSOLIDATED BALANCE SHEETS
                                   (Unaudited)


                                                       June 30,    December 31,
                                                         2002         2001
..
                                                       (Dollars in thousands)
LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIT)

CURRENT LIABILITIES
   Accounts payable                                 $  97,216    $  85,043
   Accrued liabilities                                207,127      189,248
   Accrued claims costs                                79,362       85,593
   Federal and other income taxes                       1,971        2,264
   Deferred income taxes                                   50           --
   Current maturities of long-term debt and
     capital lease obligations                          5,061          113
   Short-term borrowings                               24,925       83,900
      Total Current Liabilities                       415,712      446,161

LONG-TERM LIABILITIES
   Capital lease obligation                               657          697
   Long-term debt                                      90,083       15,100
   Accrued claims costs                                89,072       94,187
   Employee benefits                                  130,431      124,284
   Deferred income taxes                                4,801        1,978
   Other liabilities                                   60,803       49,934
      Total Liabilities                               791,559      732,341

SHAREHOLDERS' EQUITY (DEFICIT)
   Preferred stock, $.01 par value; authorized
     5,000,000 shares; none issued                         --           --
   Common stock, $.01 par value; authorized
     50,000,000 shares; issued 23,133,848 shares          231          231
   Additional paid-in capital                          73,109       74,020
   Accumulated other comprehensive loss               (11,350)    (13,712)
   Retained earnings (deficit)                        (63,918)     95,814
   Treasury stock, at cost (691,423 and 926,102
     shares, respectively)                             (6,058)     (8,114)
       Total Shareholders' Equity (Deficit)            (7,986)    148,239

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIT)$ 783,573    $880,580



     The accompanying notes are an integral part of these statements.


<TABLE>
<CAPTION>

                   CONSOLIDATED FREIGHTWAYS CORPORATION
                             AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                 (Dollars in thousands except per share amounts)




                                        For the                    For the
                                         Three                       Six
                                         Months                     Months
                                         Ended                      Ended
                                        June 30,                   June 30,
                                   2002        2001          2002          2001

<S>                         <C>           <C>            <C>             <C>
REVENUES                     $   482,419   $  590,415     $  945,410      $1,164,993

COSTS AND EXPENSES
    Salaries, wages and
       benefits                  341,141      391,857        659,342         765,615

    Operating expenses           103,023      123,826        195,634         226,959

    Purchased  transportation     48,139       60,152         91,098         113,140

    Operating taxes and
      licenses                    14,143       16,448         28,410          32,831

    Claims and insurance           5,465       16,002         18,122          31,163

    Depreciation                  13,398       13,852         26,608          26,777

    Write-off of internal
      use software
      under development (a)       10,986           --         10,986              --


                                 536,295      622,137      1,030,200      1,196,485

OPERATING LOSS                   (53,876)     (31,722)       (84,790)       (31,492)

OTHER INCOME (EXPENSE)
   Investment income                  40          166             91            390

   Interest expense               (2,728)      (2,037)        (4,627)        (3,893)

   Miscellaneous, net             (1,822)         336         (4,495)          (313)

                                  (4,510)      (1,535)        (9,031)        (3,816)

Loss before income taxes         (58,386)     (33,257)       (93,821)       (35,308)

Income taxes (b)                  64,808        1,792         65,911          1,568

NET LOSS                     $  (123,194)  $  (35,049)    $ (159,732)     $ (36,876)


Basic average shares
   outstanding                22,425,263   21,920,756      22,362,856     21,870,028

Diluted average shares
   outstanding (c)            22,425,263   21,920,756      22,362,856     21,870,028


Basic Loss per Share:        $    (5.49)   $    (1.60)    $     (7.14)    $   (1.69)

Diluted Loss per Share:      $    (5.49)   $    (1.60)    $     (7.14)    $   (1.69)

<FN>

(a)  The three and six months ended June 30, 2002 reflect the write-off of
      costs of internal use software under development that the Company no
     longer intends to complete.
(b)  The three and six months ended June 30, 2002 reflect $81.9 million and
     $95.9 million, respectively, of valuation allowance against the net
     domestic deferred tax asset. The three and six months ended
     June 30, 2001 reflect $14.1 million of valuation allowance against
     the net domestic deferred tax asset.  See Note 6 for further discussion.
(c)  The three and six-months ended June 30, 2001 do not include 428,073
     and 336,205 potentially dilutive securities because to do so would
     be anti-dilutive.  There were no potentially dilutive securities in the
     three and six-months ended June 30, 2002.

 The accompanying notes are an integral part of these financial statements


</TABLE>

                        CONSOLIDATED FREIGHTWAYS CORPORATION
                                AND SUBSIDIARIES
                     STATEMENTS OF CONSOLIDATED CASH FLOWS
                                 (Unaudited)

                                                       Six Months Ended
                                                           June 30,
                                                       2002         2001
                                                    (Dollars in thousands)

CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD      $  28,067     $  46,523

CASH FLOWS FROM OPERATING ACTIVITIES
Net loss                                             (159,732)      (36,876)
Adjustments to reconcile net loss to net cash
  used by operating activities:
Depreciation and amortization                          33,935        31,500
Write-off of deferred internal use software costs      10,986            --
Deferred income taxes                                  62,770         6,181
Gains from property disposals, net                     (3,565)      (19,665)
Issuance of common stock under stock
  and benefit plans                                     1,145         1,232
Changes in assets and liabilities:
   Receivables                                          6,055       (18,180)
   Prepaid expenses                                    (8,833)       (3,039)
   Accounts payable                                    12,173          (728)
   Accrued liabilities                                 17,879        18,544
   Accrued claims costs                               (11,346)          428
   Income taxes                                          (293)        2,508
   Employee benefits                                    6,147         1,879
   Other                                                4,840         2,915
   Net Cash Used by Operating Activities              (27,839)      (13,301)

CASH FLOWS FROM INVESTING ACTIVITIES
   Capital expenditures                                (1,916)      (64,895)
   Software expenditures                               (1,059)       (1,583)
   Proceeds from sales of property                      7,729         3,122
   Net Cash Provided (Used) by Investing Activities     4,754       (63,356)

CASH FLOWS FROM FINANCING ACTIVITIES
   Net proceeds from (repayments of) short-term
      borrowings                                      (58,975)       69,500
   Proceeds from long-term borrowings                  78,944            --
   Repayment of long-term borrowings and
      capital lease obligations                          (657)           --
   Payments of debt issuance costs                    (13,460)       (1,642)
   Proceeds from exercise of stock options                 --           135
   Net Cash Provided by Financing Activities            5,852        67,993

Decrease in Cash and Cash Equivalents                 (17,233)       (8,664)

CASH AND CASH EQUIVALENTS, END OF PERIOD            $  10,834     $  37,859



      The accompanying notes are an integral part of these statements.



                CONSOLIDATED FREIGHTWAYS CORPORATION
                           AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             (Unaudited)

1. Subsequent Events

     On   September   3,  2002,  Consolidated  Freightways  Corporation,   a
Delaware  corporation  ("CFC"),  Consolidated  Freightways  Corporation   of
Delaware,  a  Delaware  corporation  ("CFCD"),  CF  AirFreight  Corporation,
a   Delaware  corporation  ("CF  AirFreight"),  Redwood  Systems,  Inc.,   a
Delaware    corporation   ("Redwood   Systems"),   Leland   James    Service
Corporation,    a   Delaware   corporation   ("Leland   James")    and    CF
MovesU.com     Incorporated,     a    Delaware     corporation     ("CFMU"),
(collectively,  the  "Debtors"),  intend  to  file  petitions   for   relief
under  Chapter  11  of  the  United States Bankruptcy  Code  ("Chapter  11")
in   the  United  States  Bankruptcy  Court  for  the  Central  District  of
California.   The  Debtors  required  substantial  additional   sources   of
financing  in  order  to  satisfy  their obligations  in  a  timely  manner.
The   Debtors   had   discussions   under   way   with   existing   lenders,
investors  and  other  sources  to  obtain  the  additional  financing   the
Debtors  needed  to  continue  operations.  The  Debtors  have  been  unable
to  secure  sufficient  additional financing  to  continue  operations.   In
particular,  the  Chapter  11  filing is  necessary  because  one  of  CFC's
surety   bondholders   cancelled   coverage   relating   to   CFC's    self-
administered    insurance   programs   for   workers'    compensation    and
vehicular  casualty.   This  negatively  impacted  the  pending  discussions
with  all  lenders  and  investors.  Ultimately, CFC was  unable  to  secure
financing   and  to  bridge  the  surety  bond  gap,  at  which  point   the
situation  became  critical.   Moreover,  the  Debtors  anticipated  that  a
second   insurer  would  also  cancel  coverage.   The  Board  of  Directors
reluctantly  concluded  that  the Debtors could  not  continue  to  operate,
pay   employees  and  meet  its  obligations.   The  Debtors  will  ask  the
bankruptcy  court  to  allow  them to oversee their  operations  as  debtors
in   possession,   subject  to  court  approval  of  matters   outside   the
ordinary  course  of  business.   While in  Chapter  11,  the  Debtors  will
attempt   a  management-directed  sale  of  the  Debtors'  business   as   a
going  concern.   In  the  event such a sale is not  possible,  the  Debtors
will    attempt   to   sell   portions   of   the   business   in   separate
transactions   and   to  liquidate  and  collect  the   remainder   of   the
Debtors'  assets.   The  Debtors have engaged  an  investment  banking  firm
to  assist  in  the  sale.   All such sales will  attempt  to  maximize  the
value   of   the   Debtors'  assets  for  the  benefit   of   the   Debtors'
creditors.  CFC  believes  that  the Debtors  will  not  be  able  to  fully
satisfy  the  claims  of  the  creditors from the  proceeds  of  such  sales
and   liquidations.    Therefore,  CFC  believes  that  CFC's   stockholders
will not receive any distributions on account of their stock.

     On  September  2,  2002,  CFC,  CFCD,  Redwood  Systems,  Leland  James
and  CFMU  sent  notices  of  termination  to  approximately  15,500  active
employees  and  effectively  ceased  all  operations  except  those  limited
operations   necessary   to   protect   the   Debtors'   assets.    Canadian
Freightways  Ltd.  and  subsidiaries  and  Grupo  Consolidated  Freightways,
S.A.  de  RL,  as  well  as  several non-operating  subsidiaries,  have  not
terminated  their  employees  and  are  continuing  their  normal   business
operations.   These  entities  will  not  be  included  in  the   bankruptcy
filings.   CF  AirFreight,  although  included  in  the  bankruptcy  filing,
did   not   terminate  any  employees  and  will  continue  normal  business
operations.

     In  July  2002,  CFC  completed  a  $6.9  million  financing  agreement
secured  by  terminal  properties.  Under  the  agreement,  CFC  contributed
4  terminal  properties  with  a  net  book  value  of  approximately  $14.3
million   to   CFCD   2002A  LLC,  a  wholly  owned,  consolidated   special
purpose   company.   CFCD  2002A  LLC  used  the  properties  as  collateral
for   the   borrowings.   Borrowings  bear  interest   at   13%.    Interest
payments   are   due  monthly  with  principal  due  in   3   years.    Loan
proceeds,  net  of  deferred  loan costs,  of  $6.5  million  were  used  to
pay   down   borrowings   under  CFC's  credit  facilities   and   to   fund
operations.

      Also  in  July  2002,  CFC  entered into a  three-year  $14.5  million
credit  facility  to  provide  for working  capital  and  letter  of  credit
needs.   The   agreement  is  secured  by  accounts  receivable   of   CFC's
Canadian   subsidiaries,  a  general  security   interest   in   all   other
Canadian  assets  as  well  as  a  second position  on  current  and  future
mortgaged   Canadian   properties.   Borrowings   bear   interest   at   the
Canadian  prime  rate  plus  0.875%.   Letters  of  credit  are  limited  to
approximately   $12.0  million.   The  availability  of  funds   under   the
agreement  would  have  required the Canadian  subsidiaries  to  maintain  a
minimum   tangible   net  worth.   Approximately  $10.0   million   of   the
availability   was  used  for  letter  of  credit  needs  of  the   Canadian
subsidiaries.


2.Basis of Presentation

       The  accompanying  consolidated  financial  statements  of  CFC   and
subsidiaries  (collectively,  the  "Company")  have  been  prepared  by  the
Company,  without  audit  pursuant  to the  rules  and  regulations  of  the
Securities   and  Exchange  Commission.   In  the  opinion  of   management,
the    consolidated   financial   statements   include   all    adjustments,
consisting  of  only  normal  recurring  adjustments  necessary  to  present
fairly   the  information  set  forth  therein.   Certain  information   and
note   disclosures  normally  included  in  financial  statements   prepared
in   accordance  with  accounting  principles  generally  accepted  in   the
United   States  have  been  condensed  or  omitted  from  these  statements
pursuant  to  such  rules  and  regulations.  Accordingly,  these  financial
statements   should   be   read  in  conjunction   with   the   consolidated
financial   statements   included   in   CFC's   2001   Annual   Report   to
Shareholders.

       The   accompanying  consolidated  financial  statements   have   been
prepared  on  a  going  concern  basis  that  contemplates  the  realization
of  assets  and  the  settlement  of  liabilities  and  commitments  in  the
normal   course   of   business.   In  all   likelihood,   this   basis   of
accounting   will  change  to  either  that  prescribed  by   Statement   of
Position   90-7   "Financial   Reporting  by  Entities   in   Reorganization
under  the  Bankruptcy  Code"  or  to the liquidation  basis  of  accounting
in the third quarter of 2002.

       Management  considers  as  its  most  critical  accounting   policies
those    that    require   the   use   of   estimates    and    assumptions,
specifically,   self-administered  insurance  reserves,  and   pension   and
post-retirement   benefit  liabilities.   In  developing   these   estimates
and   assumptions,   the   Company  takes  into   consideration   historical
experience,  current  and  expected  economic  conditions  and,  in  certain
cases,   actuarial   analysis.   The  Company  continually   reviews   these
factors  and  makes  adjustments as needed.   Actual  results  could  differ
from  these  estimates  and  could have a material  adverse  effect  on  the
Company's  financial  position  and results  of  operations.   Please  refer
to   the   consolidated  financial  statements  included   in   CFC's   2001
Annual   Report   to   Shareholders  for  a   full   discussion   of   these
accounting policies.

      Certain  amounts  in  prior  year's  financial  statements  have  been
reclassified to conform to the current year presentation.


3. Segment and Geographic Information

          The     Company     primarily     provided     less-than-truckload
transportation,   air  freight  forwarding  and  supply   chain   management
services   throughout   the   United   States,   Canada   and   Mexico   and
international   freight  services  between  the  United  States   and   more
than  80  countries.   The  Company  does not  present  segment  disclosures
because   the   air   freight  forwarding,  supply  chain   management   and
international    service   offerings   do   not   meet   the    quantitative
thresholds   of  Statement  of  Financial  Accounting  Standards   No.   131
"Disclosures    about    Segments   of    an    Enterprise    and    Related
Information."   The   following  information   sets   forth   revenues   and
property,  plant  and  equipment  by  geographic  location.   Revenues   are
attributed   to  geographic  location  based  upon  the  location   of   the
customer.   No one customer provides 10% or more of total revenues.

Geographic Information

(Dollars in thousands)

                         Three                              Six
                      Months Ended                     Months Ended
                         June 30,                        June 30,
                      2002      2001                2002         2001

Revenues
United States       $441,504  $550,127          $  867,113   $1,086,071
Canada and other      40,915    40,288              78,297       78,922
Total               $482,419  $590,415          $  945,410   $1,164,993



                               As of       As of
                              June 30,   December 31,
                                2002        2001

Property, Plant and Equipment
United States                 $295,209   $322,235
Canada and other                34,213     35,356
Total                         $329,422   $357,591



4. Comprehensive Loss

      Comprehensive loss for the three and six months ended June  30,
2002 and 2001 is as follows:

(Dollars in thousands)
                                       Three                  Six
                                   Months Ended         Months Ended
                                      June 30,              June 30,
                                  2002       2001        2002       2001

Net Loss                       $(123,194)  $(35,049)  $(159,732) $(36,876)
Other comprehensive income
   (loss):
  Foreign currency
    translation adjustments        1,812        892       2,362    (1,418)
Comprehensive  Loss            $(121,382)  $(34,157)  $(157,370) $(38,294)



5. Debt

      As  discussed  in  Note 1, on September 3,  2002,  the  Debtors
intend  to file a petition for relief under Chapter 11 of the  United
States Bankruptcy Code in the United States Bankruptcy Court for  the
Central  District  of California.  The Company  has  arranged  for  a
debtor  in  possession  credit facility  (the  "DIP  Facility")  with
General  Electric  Capital Corporation ("GECC") in order  to  provide
liquidity  during the bankruptcy proceeding.  The DIP  Facility  will
provide  the  Company  with  $225 million in  financing  for  working
capital  and  letter  of  credit needs and  is  secured  by  accounts
receivable,  real  estate and rolling stock.   Borrowings  will  bear
interest  at the Prime rate as defined in the DIP Facility  plus  550
basis points.  The DIP Facility matures on the earlier of on or about
September  4,  2003  or  the  date  a  plan  of  liquidation  becomes
effective.  The DIP Facility may be terminated upon the occurrence of
an  event  of  default under the DIP Facility and contains  mandatory
paydown  provisions upon the occurrence of certain asset sales.   The
DIP  Facility contains certain performance covenants that the Company
must maintain and covenants that limit the Company's ability to incur
additional  indebtedness or pay dividends, among other  things.   The
DIP    Facility   replaces   the   Company's   accounts    receivable
securitization  agreement and real estate credit facility  previously
provided  by  GECC,  both of which are discussed below.   Outstanding
borrowings  of  $34.8 million and outstanding letters  of  credit  of
$130.6 million under these agreements will be transferred to the  DIP
Facility  on or about September 4, 2002.  Deferred costs  related  to
the  accounts  receivable securitization agreement  and  real  estate
credit facility were $4.0 million and $0.7 million, respectively,  as
of  June 30, 2002.  Those costs along with costs incurred in entering
into  the  DIP Facility will be amortized over the life  of  the  DIP
Facility.

     Existing Credit Facilities

       The   Company   had  a  $200.0  million  accounts   receivable
securitization agreement with GECC to provide for working capital and
letter  of  credit needs. As of June 30, 2002, outstanding borrowings
were  $8.6  million, bearing interest at LIBOR plus 250 basis  points
(4.34%).  Letters of credit outstanding were $133.6 million, of which
$117.0  million  are used to support the Company's  self-administered
insurance program.  Availability of the remaining borrowing  capacity
would have been dependent on a daily calculation of eligible accounts
receivable which is subject to business level fluctuations which  may
further  limit  availability.  To the extent that  eligible  accounts
receivable were insufficient to support issued letters of credit, the
Company  was required to provide cash collateral to the lender.   The
Company  was  required to provide as much as $10.0  million  of  cash
collateral during the six months ended June 30, 2002. As of June  30,
2002, there was no cash collateral required to support issued letters
of credit.

      The  Company  also had a revolving credit agreement  with  GECC
secured  by  real property to provide for short-term working  capital
needs  and other general corporate purposes.  In February 2002,  this
agreement  was  amended, extending the term until February  2004  and
limiting  borrowings  to  a maximum of $42.0 million.  The  agreement
contained  mandatory  paydown  provisions  using  a  portion  of  the
proceeds of additional financing agreements and asset sales.  Due  to
additional financing agreements discussed below and surplus  terminal
property sales, maximum availability was reduced to $25.0 million  as
of  June  30,  2002, of which $16.3 million was outstanding,  bearing
interest at 10%.

     The combined availability of funds under the above two financing
agreements  was  $8.2 million as of June 30, 2002.   Consistent  with
these  types of agreements, the availability ranged from $0 to  $20.5
million  during the six months ended June 30, 2002.  The availability
of  funds under these agreements would have required that the Company
comply  with  certain  financial covenants, the most  restrictive  of
which  were to maintain a minimum EBITDAL (earnings before  interest,
taxes, depreciation, amortization and lease expense) and fixed charge
coverage ratio.  The Company was in violation of these convenants  as
of  June 30, 2002 and did not receive waivers or amendments to either
agreement.   Both  agreements  were  replaced  by  the  DIP  Facility
discussed above.

      There  can  be no assurances as to the impact of  the  Debtors'
Chapter  11 filing on the debt instruments listed below.  Since  some
of  these facilities are in bankruptcy-remote entities, such entities
will  not  have the benefit of the automatic stay which  arises  with
respect to the Debtors.

      In February 2002, the Company secured a $50.4 million financing
agreement  secured  by terminal properties.  Loan  proceeds,  net  of
deferred  loan  costs, of $17.9 million were funded in  February  and
loan  proceeds,  net  of deferred loan costs, of $23.5  million  were
funded  in  April.  Under the agreement, the Company  contributed  39
terminal  properties  to CFCD 2002 LLC, a wholly owned,  consolidated
special  purpose  company.  The properties had a net  book  value  of
approximately $65.0 million as of June 30, 2002.  CFCD 2002 LLC  used
the  properties  as collateral for the borrowings.   Borrowings  bear
interest  at the six month LIBOR plus 375 basis points (5.85%  as  of
June 30, 2002).  Principal and interest payments are due monthly over
a  15-year period.  The Company was required to issue $8.2 million of
letters  of  credit to secure the first year's payment of  principal,
interest, property taxes and insurance.  Those letters of credit were
issued   under  the  Company's  $200.0  million  accounts  receivable
securitization agreement.  The initial $17.9 million of proceeds  was
used  to  pay  down short-term borrowings under the Company's  $200.0
million  accounts receivable securitization agreement. Subsequent  to
the  paydown, the Company issued a $20 million letter of credit under
the   securitization  agreement  to  support  its   self-administered
insurance  program.  The $23.5 million of proceeds was  used  to  pay
down  borrowings under the Company's real estate credit facility  and
to fund operations.

      Also in February 2002, the Company completed a three-year, $4.1
million  financing  agreement  secured  by  revenue  equipment  of  a
Canadian  subsidiary.  The revenue equipment had a net book value  of
approximately $12.0 million as of June 30, 2002.  The borrowings bear
interest  at 7.2%.  Principal and interest are payable monthly.  Loan
proceeds, net of deferred loan costs, of $3.9 million, were  used  to
pay down borrowings under the Company's credit facilities and to fund
operations.

      In April 2002, the Company completed a three-year, $5.5 million
financing  agreement  secured by a terminal property  of  a  Canadian
subsidiary.   The  terminal  property  had  a  net  book   value   of
approximately $0.4 million as of June 30, 2002.  The borrowings  bear
interest at 6.25%.  Principal and interest are payable monthly  using
a 25-year amortization schedule, with a remaining lump sum payment at
the end of the three-year period. Loan proceeds, net of deferred loan
costs,  of  $5.4 million were used to pay down borrowings  under  the
Company's credit facilities and to fund operations.

      In  June 2002, the Company completed an $18.9 million financing
agreement  secured by terminal properties.  Under the agreement,  the
Company  contributed 3 terminal properties with a net book  value  of
approximately  $22.1  million to CFCD  2002A  LLC,  a  wholly  owned,
consolidated  special  purpose company.   CFCD  2002A  LLC  used  the
properties as collateral for the borrowings. Borrowings bear interest
at  13%.  Interest payments are due monthly with principal due  in  3
years.   Loan proceeds, net of deferred loan costs, of $17.4  million
were   used  to  pay  down  borrowings  under  the  Company's  credit
facilities and to fund operations.


6.  Income Taxes

      Deferred tax assets and liabilities in the Consolidated Balance
Sheets  are  classified  based  on the  related  asset  or  liability
creating  the deferred tax.  Deferred taxes not related to a specific
asset  or  liability are classified based on the estimated period  of
reversal.  As  disclosed in CFC's 2001 Annual Report to Shareholders,
due  to domestic cumulative losses over the past three years, current
accounting standards required the Company to assess the realizability
of  its domestic net deferred tax asset as of June 30, 2001. A review
of  all  available  positive  and  negative  evidence  needed  to  be
considered,   including   the  Company's  performance,   the   market
environment in which the Company operates and available tax  planning
strategies.   Through  the use of tax planning strategies,  involving
the  sale of appreciated assets, the Company determined that  it  was
more  likely than not that $62.6 million of its domestic net deferred
tax  asset  as  of June 30, 2001 would be realized. Accordingly,  the
Company  recorded  a  valuation allowance of  $14.1  million  in  the
quarter  ended June 30, 2001. The Company subsequently  reviewed  the
realizability  of  its net deferred tax asset and recorded  valuation
allowances  as necessary.  As of December 31, 2001, the  Company  had
recorded  $40.0 million of valuation allowances resulting  in  a  net
deferred  tax  asset  of $62.6 million.  The Company  recorded  $14.0
million  and $19.3 million of additional valuation allowance  in  the
quarters  ended  March 31, 2002 and June 30, 2002,  respectively,  to
offset  the  tax benefit related to the operating loss  from  ongoing
operations.  However,  due  to the Chapter  11  filing,  the  Company
concluded  that  it  was  necessary to  establish  a  full  valuation
allowance  against  its  net deferred tax  asset.   Accordingly,  the
Company  recorded  an  additional $62.6 valuation  allowance  in  the
quarter ended June 30, 2002.


7.  Employee Benefit Plans

      The Company received approval from the Internal Revenue Service
to  change the funding methodology of its pension plan.  The  pension
plan  covers  employees in the United States who are not  subject  to
collective  bargaining  agreements.   Under  the  Company's  previous
funding  methodology, the actuarial value of the pension plan  assets
was  market  value  and  would have required  an  approximately  $7.0
million  cash  contribution in 2002.  Under the new methodology,  the
Company  is able to use a 5-year smoothing period of gains/losses  on
market value, with the gains/losses that occurred prior to January 1,
2000  being  disregarded,  eliminating any required  contribution  in
2002.  As a result of the Chapter 11 filing, funding of the plan will
cease.   The Company is unable to determine the impact of the Chapter
11 filing on its pension liability.  The pension plan assets are held
in  a  separate  trust and are outside the scope of  the  Chapter  11
filing.


8.  Recent Accounting Pronouncements

      The  Company  adopted the provisions of Statement of  Financial
Accounting  Standards (SFAS) No. 142 (SFAS 142) "Goodwill  and  Other
Intangibles"  and  SFAS  No.  144  (SFAS  144)  "Accounting  for  the
Impairment  or  Disposal of Long-Lived Assets" effective  January  1,
2002.   SFAS  142 requires that goodwill and other intangible  assets
that  have  indefinite  lives no longer be  amortized,  but  will  be
subject  to  impairment  review  annually.  Intangible  assets   with
estimated finite useful lives will continue to be amortized. SFAS 144
provides  a single accounting methodology to be applied to all  long-
lived  assets  to be disposed of, including discontinued  operations.
Adoption  of  these standards did not have a material impact  on  the
Company's financial position or results of operations.

      In  June 2001, the Financial Accounting Standards Board  (FASB)
issued  SFAS  No. 143 "Accounting for Asset Retirement  Obligations."
SFAS 143 will require that the fair value of a liability for an asset
retirement  obligation be recognized in the period  in  which  it  is
incurred if a reasonable estimate of the fair value can be made.  The
associated asset retirement costs will be capitalized as part of  the
carrying amount of the asset.  This statement is effective for fiscal
years beginning after June 15, 2002. The Company is in the process of
evaluating the financial statement impact of adopting SFAS 143.

     In April 2002, the FASB issued SFAS No. 145, "Rescission of FASB
Statements No. 4, 44, and 64, Amendment of FASB Statement No. 13, and
Technical  Corrections" (SFAS 145). SFAS 145 requires that gains  and
losses  from  extinguishment of debt be classified  as  extraordinary
items  only if they meet the criteria in Accounting Principles  Board
Opinion  No.  30  (APB 30). Applying the provisions of  APB  30  will
distinguish  transactions  that are part  of  an  entity's  recurring
operations  from those that are unusual and infrequent and  meet  the
criteria  for classification as an extraordinary item.  SFAS  145  is
effective  January  1,  2003.   The Company  is  in  the  process  of
evaluating the financial statement impact of adopting SFAS 145.

      In  July  2002,  the FASB issued SFAS No. 146  "Accounting  for
Restructuring  Costs" (SFAS 146).  Under SFAS  146,  a  company  will
record  a  liability for costs associated with an  exit  or  disposal
activity when that liability is incurred and can be measured at  fair
value.  SFAS  146 will supercede EITF Issue No. 94-3, under  which  a
company  generally could record a liability once management  approved
an  exit  or  disposal  plan,  which is generally  before  an  actual
liability  has  been incurred. Accordingly, SFAS 146 may  affect  the
timing  of recognition of future restructuring costs as well  as  the
amounts  recognized.   SFAS 146 is effective  for  exit  or  disposal
activities initiated after December 31, 2002.  The Company is in  the
process of evaluating the financial statement impact of adopting SFAS
146.


9.  Acquisitions

      In  February  2002, the Company entered into  an  agreement  to
acquire  100%  ownership  of the business  operations  of  its  joint
venture  in  Mexico, subject to terms and conditions yet to  be  met.
The   purchase  price  is  approximately  $2.1  million  payable   in
installments through April 2003.  Interest on unpaid installments  is
7.5%  annually. As of June 30, 2002, unpaid installments totaled $1.3
million.

      As  discussed in CFC's 2001 Annual Report to Shareholders,  the
purchase  agreement  related  to  First  Air,  Inc.  provides  for  a
contingent  payment  to the former owner if revenues  exceed  certain
targeted  levels  before May 31, 2003. The payment shall  not  exceed
$2.5  million.  Based upon revenues earned as of June 30,  2002,  the
Company  recorded a $2.5 million liability and related adjustment  to
goodwill.  Payment is not due until May 2004.


10.  Contingencies

      Except as otherwise may be determined by the bankruptcy  court,
the  stay  protection afforded by the Chapter 11  case  prevents  any
action  from  being  taken against the estate  of  the  Debtors.  The
Company plans on rejecting multiple executory contracts and leases as
a  result  of  its  bankruptcy filing, which will  likely  result  in
significant   pre-petition  claims.   In  most  cases,   pre-existing
litigation  and  claims  will have the status  of  general  unsecured
claims in the Chapter 11 case.

      Approximately  80%  of  the Company's domestic  employees  were
covered  by  union-sponsored, collectively bargained,  multi-employer
pension  plans.  Company contributions were made in  accordance  with
negotiated  labor contracts and generally were based on time  worked.
Under existing legislation regarding multi-employer pension plans,  a
total or partial withdrawal from an under-funded plan would result in
the  Company  having to fund a proportionate share  of  the  unfunded
vested  liability.  The Company is unable to estimate the  amount  of
the unfunded vested liability, but expects it to be substantial.

       The   Company,  through  its  captive  insurance   subsidiary,
participates  in a reinsurance pool to reinsure the majority  of  its
workers'  compensation  liability.  As  a  participant,  the  Company
transfers  its  liability into the pool and reinsures  an  equivalent
amount of risk from the pool.  Under the provisions of SFAS No.  113,
"Accounting and Reporting for Reinsurance of Short-Duration and Long-
Duration  Contracts,"  the Company records a  reinsurance  receivable
associated  with  liabilities  transferred  into  the  pool   and   a
corresponding  liability for the reinsured  risk.   As  of  June  30,
2002,   the   reinsurance  receivable  associated  with   liabilities
transferred  into  the pool was $50.4 million  and  was  included  in
Deposits  and  Other Assets in the Consolidated Balance  Sheet.   The
corresponding reinsured risk of $50.4 million was included  in  Other
Liabilities in the Consolidated Balance Sheet.  Reinsurance does  not
relieve   the  Company  of  ultimate  responsibility  for   its   own
transferred  liabilities.  As a result of the Chapter 11 filing,  the
Company  will withdraw from the reinsurance pool, which could  result
in  a  liability payable to the reinsurance pool of approximately  $4
million.


        CONSOLIDATED FREIGHTWAYS CORPORATION AND SUBSIDIARIES
           ITEM 2. Management's Discussion and Analysis of
            Financial Condition and Results of Operations


     On  September  3, 2002, Consolidated Freightways Corporation,  a
Delaware corporation ("CFC"), Consolidated Freightways Corporation of
Delaware, a Delaware corporation ("CFCD"), CF AirFreight Corporation,
a  Delaware corporation ("CF AirFreight"), Redwood Systems,  Inc.,  a
Delaware  corporation  ("Redwood  Systems"),  Leland  James   Service
Corporation,   a  Delaware  corporation  ("Leland  James")   and   CF
MovesU.com    Incorporated,   a   Delaware   corporation    ("CFMU"),
(collectively,  the "Debtors"), intend to file petitions  for  relief
under Chapter 11 of the United States Bankruptcy Code ("Chapter  11")
in  the  United States Bankruptcy Court for the Central  District  of
California.  The Debtors required substantial additional  sources  of
financing  in order to satisfy their obligations in a timely  manner.
The   Debtors  had  discussions  under  way  with  existing  lenders,
investors  and  other sources to obtain the additional financing  the
Debtors needed to continue operations.  The Debtors have been  unable
to secure sufficient additional financing to continue operations.  In
particular, the Chapter 11 filing is necessary because one  of  CFC's
surety  bondholders  cancelled  coverage  relating  to  CFC's   self-
administered   insurance  programs  for  workers'  compensation   and
vehicular casualty.  This negatively impacted the pending discussions
with all lenders and investors.  Ultimately, CFC was unable to secure
financing  and  to  bridge the surety bond gap, at  which  point  the
situation became critical.  Moreover, the Debtors anticipated that  a
second  insurer would also cancel coverage.  The Board  of  Directors
reluctantly concluded that the Debtors could not continue to operate,
pay  employees and meet its obligations.  The Debtors  will  ask  the
bankruptcy court to allow them to oversee their operations as debtors
in  possession,  subject  to court approval of  matters  outside  the
ordinary  course of business.  While in Chapter 11, the Debtors  will
attempt  a  management-directed sale of the Debtors'  business  as  a
going concern.  In the event such a sale is not possible, the Debtors
will   attempt  to  sell  portions  of  the  business   in   separate
transactions  and  to  liquidate and collect  the  remainder  of  the
Debtors' assets.  The Debtors have engaged an investment banking firm
to  assist in the sale.  All such sales will attempt to maximize  the
value  of  the  Debtors'  assets for  the  benefit  of  the  Debtors'
creditors.  CFC believes that the Debtors will not be able  to  fully
satisfy  the claims of the creditors from the proceeds of such  sales
and  liquidations.   Therefore, CFC believes that CFC's  stockholders
will not receive any distributions on account of their stock.

     On  September 2, 2002, CFC, CFCD, Redwood Systems, Leland  James
and  CFMU sent notices of termination to approximately 15,500  active
employees and effectively ceased all operations except those  limited
operations  necessary  to  protect  the  Debtors'  assets.   Canadian
Freightways Ltd. and subsidiaries and Grupo Consolidated Freightways,
S.A.  de RL, as well as several non-operating subsidiaries, have  not
terminated  their employees and are continuing their normal  business
operations.   These entities will not be included in  the  bankruptcy
filings.  CF AirFreight, although included in the bankruptcy  filing,
did  not  terminate any employees and will continue  normal  business
operations.

     The  effects  of  the  economic  slowdown  that  began  in  2001
continued   to  impact  CFC  and  its  subsidiaries  ("the  Company")
throughout  the  first six months of 2002.  Revenues  for  the  three
months  ended  June  30,  2002 decreased 18.3%  on  a  16.0%  tonnage
decrease   compared  with  the  same  period  last  year.   Shipments
decreased 16.4% and the average weight per shipment increased 0.5% to
996   lbs.    The  Company  continued  to  be  impacted  by  negative
perceptions  in  the  marketplace regarding the Company's  liquidity,
customer service issues and by the loss of two large customers due to
aggressive competitive pricing.  Revenue per hundredweight  decreased
2.4%  to  $16.89 despite a 5.95% general rate increase  and  a  $5.50
increase  in the absolute minimum shipment charge, both of which  are
applicable to approximately 30% of tonnage, effective June 3rd.   The
decrease was due to a continued unfavorable freight mix as well as  a
decrease  in the fuel surcharge, as fuel prices continued to decline.
Excluding  the  fuel  surcharge, revenue per hundredweight  decreased
1.4%.   Revenues  for  the six months ended June 30,  2002  decreased
18.9% on a 16.5% decrease in tonnage.  Shipments decreased 15.4%  and
the  weight  per  shipment decreased 1.3% to 983  lbs.   Revenue  per
hundredweight decreased 2.9% to $17.01. Excluding the fuel surcharge,
revenue per hundredweight decreased 1.4%.

      Salaries, wages and benefits decreased 12.9% and 13.9%  in  the
three  and  six-month periods, respectively, due primarily  to  lower
tonnage  levels.   Beginning in the third quarter of 2001, management
implemented  workforce  reductions in  response  to  continued  lower
tonnage levels.  The workforce was approximately 20% and 18% lower in
the  three  and  six-month periods, respectively, compared  with  the
prior  year.   However, those workforce reductions were  insufficient
relative  to  actual tonnage declines. Additionally,  based  upon  an
actuarial analysis of the Company's workers' compensation reserve  as
of   June   30,  2002,  it  was  determined  that  the  reserve   was
approximately    $10.0   million   understated.    Accordingly,    an
approximately $10.0 million charge was recorded in the quarter  ended
June  30,  2002.  The Company was also impacted by a 2.0% contractual
wage and benefit increase that was effective April 1, 2002 as well as
severance  due  to a management change in May 2002. The  Company  did
benefit   from   improved  cross-dock  and   pick-up   and   delivery
efficiencies as a result of process improvement programs.

      Operating  expenses decreased 16.8% in the  three-month  period
compared with the prior year.  Excluding gains on sales of properties
of  $1.4  million in the three-month period and $0.4 million  in  the
same  period  last year, operating expenses decreased  16.0%.   Lower
tonnage levels, an approximate 19% decrease in the average fuel  cost
per  gallon,  lower  maintenance costs and  aggressive  cost  control
measures  primarily  accounted for the decrease.   Additionally,  the
decrease reflects lower lease expense as revenue equipment previously
under  lease was purchased during the second quarter of  2001.   This
offset  higher  than usual legal costs, an increase to the  allowance
for  bad  debt  due  to  accounts receivable  collection  issues  and
facility   closure  costs  related  to  the  Company's  air   freight
subsidiary.   Operating expenses for the six-month  period  decreased
13.8%  for the reasons noted above.  The average fuel cost per gallon
decreased   approximately  25%  from  the  same  period  last   year.
Excluding  gains on sales of operating properties of $3.9 million  in
the  six-month period and $20.0 million in the same period last year,
operating expenses decreased 19.2%.  The Company was also impacted in
the  three and six-month periods by excess fixed costs as the Company
worked  to  reduce its freight flow infrastructure to  reflect  lower
tonnage levels.

      Purchased transportation decreased 20.0% and 19.5% in the three
and  six-month periods, respectively, due to lower tonnage levels  as
well  as  a  lower proportion of freight transported via  rail.  Rail
miles  as  a  percentage of inter-city miles during  the  three-month
period decreased to 26.6% from 28.3% in the prior year.  For the six-
month  period, rail miles decreased to 25.7% from 27.1% in the  prior
year.

      Operating taxes and licenses decreased 14.0% and 13.5%  in  the
three  and  six-month  periods, respectively, reflecting  lower  fuel
taxes and licensing fees due to lower tonnage levels.

      Claims and insurance decreased 65.9% and 41.9% in the three and
six-  month periods, respectively.  Based upon an actuarial  analysis
of  the  Company's  vehicular reserve as of June  30,  2002,  it  was
determined   that  the  reserve  was  approximately   $10.0   million
overstated.  Accordingly, the excess accrual  of approximately  $10.0
million  was  reversed to income during the quarter  ended  June  30,
2002.  Additionally, cargo claims expense decreased in the three  and
six-month   periods  due  to  lower  tonnage  and   improved   claims
experience.

      Depreciation decreased 3.3% and 0.6% in the three and six-month
periods,  respectively, due to lower capital expenditures,  a  higher
proportion of the fleet becoming fully depreciated and asset sales.

      The  Company wrote-off approximately $11.0 million of  deferred
costs during the three months ended June 30, 2002 related to internal
use software under development that the Company no longer intends  to
complete.

      The operating loss was $53.9 million for the three-month period
compared with a $31.7 million operating loss for the same period last
year.   The operating ratio deteriorated to 111.2% from 105.4%.   The
Canadian  operations  contributed $3.4 million  of  operating  income
compared  with $3.8 million for the same period last year.  Excluding
gains  on sales of operating properties, the operating loss was $55.2
million  compared with a $32.1 million operating loss  for  the  same
period  last  year.  The  operating ratio was  111.4%  compared  with
105.4%, excluding the gains.  For the six-month period, the operating
loss was $84.8 million compared with $31.5 million in the same period
last  year.  The operating ratio deteriorated to 109.0% from  102.7%.
The  Canadian operations contributed $5.9 million of operating income
in  the  six-month  period compared with $6.6 million  for  the  same
period  last year.  Excluding gains on sales of operating properties,
the  operating  loss  was  $88.7 million  for  the  six-month  period
compared with a $51.5 million operating loss for the same period last
year.  The operating ratio was 109.4% compared with 104.4%, excluding
the gains.

      Other  expense, net, increased $3.0 million in the  three-month
period  and  $5.2  million in the six-month period due  primarily  to
higher  costs associated with increased letter of credit requirements
to  support  the Company's self-administered insurance  programs  and
increased interest expense on higher debt levels.  The three and six-
month  periods also reflect an approximate $0.5 million write-off  of
deferred  loan  costs due to a reduction in borrowing capacity  under
the  Company's  real  estate credit facility.  The  six-month  period
reflects  the  write-off  of  approximately  $1.2  million  of  costs
associated  with financing transactions that the Company decided  not
to pursue.

      The  Company's  effective tax rate differs from  the  statutory
federal  rate due to foreign taxes and the recording of deferred  tax
valuation  allowances. As disclosed in CFC's 2001  Annual  Report  to
Shareholders, due to domestic cumulative losses over the  past  three
years,  current accounting standards required the Company  to  assess
the  realizability of its domestic net deferred tax asset as of  June
30,  2001.  A review of all available positive and negative  evidence
needed  to  be  considered, including the Company's performance,  the
market  environment in which the Company operates and  available  tax
planning  strategies.   Through the use of tax  planning  strategies,
involving the sale of appreciated assets, the Company determined that
it  was  more likely than not that $62.6 million of its domestic  net
deferred   tax  asset  as  of  June  30,  2001  would  be   realized.
Accordingly,  the  Company recorded a valuation  allowance  of  $14.1
million  in the quarter ended June 30, 2001. The Company subsequently
reviewed the realizability of its net deferred tax asset and recorded
valuation  allowances  as necessary.  As of December  31,  2001,  the
Company  had recorded $40.0 million of valuation allowances resulting
in  a  net deferred tax asset of $62.6 million.  The Company recorded
$14.0 million and $19.3 million of additional valuation allowance  in
the quarters ended March 31, 2002 and June 30, 2002, respectively, to
offset  the  tax benefit related to the operating loss  from  ongoing
operations.  However,  due  to the Chapter  11  filing,  the  Company
concluded  that  it  was  necessary to  establish  a  full  valuation
allowance  against  its  net deferred tax  asset.   Accordingly,  the
Company  recorded  an  additional $62.6 valuation  allowance  in  the
quarter ended June 30, 2002.

      Approximately  80%  of  the Company's domestic  employees  were
represented  by  various  labor unions, primarily  the  International
Brotherhood  of Teamsters (IBT). The Company and the IBT are  parties
to  the  National Master Freight Agreement (NMFA), which  expires  on
March 31, 2003.

      On  April  1, 2002, a 2.0% wage and benefit increase went  into
effect for employees covered by the NMFA. The current NMFA allows for
an increase in the amount of the Company's contribution to the union,
health and welfare plans effective August 1, 2002.

      As  discussed above, the Company experienced lower average fuel
costs  per  gallon during the first six months of 2002 compared  with
the  same period last year.  The Company's rules tariff implements  a
fuel  surcharge when the average cost per gallon of on-highway diesel
fuel  exceeds  $1.10,  as  determined  from  the  Energy  Information
Administration  of the Department of Energy's publication  of  weekly
retail  on-highway diesel prices.  This provision of the rules tariff
became effective in July 1999 and remains in effect.


LIQUIDITY AND CAPITAL RESOURCES

      On September 3, 2002, the Debtors intend to file a petition for
relief  under Chapter 11 of the United States Bankruptcy Code in  the
United   States  Bankruptcy  Court  for  the  Central   District   of
California.   The  Company has arranged for a  debtor  in  possession
credit  facility  (the "DIP Facility") with General Electric  Capital
Corporation  ("GECC")  in  order  to  provide  liquidity  during  the
bankruptcy  proceeding.  The DIP Facility will  provide  the  Company
with  $225  million in financing for working capital  and  letter  of
credit  needs and is secured by accounts receivable, real estate  and
rolling  stock.   Borrowings will bear interest at the Prime rate  as
defined  in the DIP Facility plus 550 basis points.  The DIP Facility
matures on the earlier of on or about September 4, 2003 or the date a
plan  of  liquidation  becomes effective.  The DIP  Facility  may  be
terminated upon the occurrence of an event of default under  the  DIP
Facility   and  contains  mandatory  paydown  provisions   upon   the
occurrence of certain asset sales.  The DIP Facility contains certain
performance  covenants that the Company must maintain  and  covenants
that limit the Company's ability to incur additional indebtedness  or
pay  dividends,  among other things.  The DIP Facility  replaces  the
Company's  accounts  receivable  securitization  agreement  and  real
estate credit facility previously provided by GECC, both of which are
discussed in Note 5 "Debt."  Outstanding borrowings of $34.8  million
and  outstanding  letters  of credit of $130.6  million  under  these
agreements  will  be  transferred to the DIP  Facility  on  or  about
September 4, 2002.  Deferred costs related to the accounts receivable
securitization  agreement and real estate credit facility  were  $4.0
million  and $0.7 million, respectively, as of June 30, 2002.   Those
costs  along  with costs incurred in entering into the  DIP  Facility
will be amortized over the life of the DIP Facility.

      There  can  be no assurances as to the impact of  the  Debtors'
Chapter  11 filing on the debt instruments listed below.  Since  some
of  these facilities are in bankruptcy-remote entities, such entities
will  not  have the benefit of the automatic stay which  arises  with
respect to the Debtors.

       As  previously  disclosed  in  CFC's  2001  Annual  Report  to
Shareholders,  the  Company self-administers for  medical,  casualty,
liability,  vehicular, cargo and workers' compensation claims  within
deductibles  limits that range between $1.0 million and $8.0  million
depending on the insurance program.   For self-administered insurance
programs, the Company is required to post letters of credit to ensure
payments  under  its  worker  compensation  and  liability  insurance
coverage.  Outstanding letters of credit related to these programs as
of  June  30,  2002  were $117.0 million and were  issued  under  the
Company's   $200.0   million   accounts   receivable   securitization
agreement,  discussed  above.   Due  to  adverse  conditions  in  the
insurance  market and the Company's financial position,  the  Company
expected that in order to maintain these insurance programs, it would
have  needed to provide for a substantial amount of liquidity at  the
October  1, 2002 insurance renewal date. The Company also  has  $97.3
million of surety bonds, of which $82.6 million support the insurance
programs.   Adverse  conditions  in  the  insurance  market  and  the
Company's financial position resulted in the cancellation  of  a  $25
million  insurance  bond effective October 1, 2002  and  most  likely
would  have  impacted the ability of the Company to renew  its  other
insurance  related  bonds as of October 1, 2002.  The  Company  would
have  been  required  to  post collateral to secure  the  bonds.  The
inability  of the Company to negotiate successfully with  its  surety
insurance companies and renew its insurance related surety  bonds  as
of  October  1,  2002  would  have required  the  Company  to  secure
alternative financing arrangements.

      In  July  2002, the Company completed a $6.9 million  financing
agreement  secured by terminal properties.  Under the agreement,  the
Company  contributed 4 terminal properties with a net book  value  of
approximately  $14.3  million to CFCD  2002A  LLC,  a  wholly  owned,
consolidated  special  purpose company.   CFCD  2002A  LLC  used  the
properties as collateral for the borrowings. Borrowings bear interest
at  13%.  Interest payments are due monthly with principal due  in  3
years.   Loan  proceeds, net of deferred loan costs, of $6.5  million
were   used  to  pay  down  borrowings  under  the  Company's  credit
facilities and to fund operations.

      Also  in July 2002, the Company entered into a three-year $14.5
million credit facility to provide for working capital and letter  of
credit needs. The agreement is secured by accounts receivable of  the
Company's Canadian subsidiaries, a general security interest  in  all
other  Canadian  assets as well as a second position on  current  and
future  mortgaged Canadian properties.  Borrowings bear  interest  at
the  Canadian prime rate plus 0.875%.  Letters of credit are  limited
to  approximately $12.0 million.  The availability of funds under the
agreement would have required the Canadian subsidiaries to maintain a
minimum  tangible  net  worth.  Approximately $10.0  million  of  the
availability  was  used for letter of credit needs  of  the  Canadian
subsidiaries.

Cash Flows for the Six Months Ended June 30, 2002 and 2001

      Cash  and  cash equivalents were $10.8 million as of  June  30,
2002.  Drafts outstanding, which are included in Accounts Payable  on
the  Consolidated Balance Sheet, were $20.3 million.  Cash flow  used
by  operations  for  the six months ended June 30,  2002  were  $27.8
million  compared with $13.3 million used by operations in  the  same
period of 2001.

      Cash flows provided by investing activities of $4.8 million  in
the  six-month  period  compares with cash flows  used  by  investing
activities  of  $63.4  million in the same  period  last  year.   The
reduction in capital and software expenditures from $66.5 million  in
the  prior  year period to $3.0 million in the current year  reflects
management's efforts to improve the Company's liquidity by  deferring
all  non-essential expenditures. The prior year reflects the purchase
of strategic terminals in Brooklyn, NY, Phoenix, AZ and Laredo, TX as
well  as revenue equipment previously under lease. Proceeds on  sales
of  property of $7.7 million primarily reflects the sale  of  surplus
terminal  properties.  This compares with $3.1 million in  the  prior
year.

      As  a  result of the Debtors' petition for relief under Chapter
11,  there  will be no availability of funds under any  of  the  debt
instruments  listed below. Further, the Company  will  likely  be  in
default  on  substantially all of its pre-petition debt  obligations,
some  of which may be automatically accelerated.  Except as otherwise
may  be  determined  by  the bankruptcy court,  the  stay  protection
afforded by the Chapter 11 case prevents any action from being  taken
with   regard  to  any  of  the  defaults  under  pre-petition   debt
obligations  of  Debtors.   Since some of  these  facilities  are  in
bankruptcy-remote entities, such entities will not have  the  benefit
of the automatic stay which arises with respect to the Debtors.

      Cash  flows provided by financing activities for the  six-month
period  was  $5.9 million compared with $68.0 million  in  the  prior
year. The Company secured $78.9 million of long-term financing in the
six-month  period  as  discussed below.  Proceeds,  net  of  deferred
financing fees, of $68.1 million were used to pay down $59.0  million
of  borrowings under the Company's credit facilities.  The  remainder
was  used to fund operating activities.  Of the availability  created
by  the  paydown  of  borrowings under the credit  facilities,  $20.0
million  was used to issue letters of credit to support the Company's
self-administered  insurance  program.   Availability   was   further
reduced  by  $17  million  due  to mandatory  paydown  provisions  as
discussed above.  The Company paid approximately $2.6 million in  the
six  months ended June 30, 2002 for amendments to accounts receivable
securitization agreement and real estate credit facility.

      In February 2002, the Company secured a $50.4 million financing
agreement  secured  by terminal properties.  Loan  proceeds,  net  of
deferred  loan  costs, of $17.9 million were funded in  February  and
loan  proceeds,  net  of deferred loan costs, of $23.5  million  were
funded  in  April.  Under the agreement, the Company  contributed  39
terminal  properties  to CFCD 2002 LLC, a wholly owned,  consolidated
special  purpose  company.  The properties had a net  book  value  of
approximately $65.0 million as of June 30, 2002.  CFCD 2002 LLC  used
the  properties  as collateral for the borrowings.   Borrowings  bear
interest  at the six month LIBOR plus 375 basis points (5.85%  as  of
June 30, 2002).  Principal and interest payments are due monthly over
a  15-year period.  The Company was required to issue $8.2 million of
letters  of  credit to secure the first year's payment of  principal,
interest, property taxes and insurance.  Those letters of credit were
issued   under   the  Company's  $200  million  accounts   receivable
securitization agreement. The initial $17.9 million of  proceeds  was
used  to  pay  down  short-term borrowings under the  Company's  $200
million  accounts receivable securitization agreement. Subsequent  to
the  paydown, the Company issued a $20 million letter of credit under
the   securitization  agreement  to  support  its   self-administered
insurance  program.  The $23.5 million of proceeds was  used  to  pay
down  borrowings under the Company's real estate credit facility  and
to fund operations.

      Also in February 2002, the Company completed a three-year, $4.1
million  financing  agreement  secured  by  revenue  equipment  of  a
Canadian  subsidiary.  The revenue equipment had a net book value  of
approximately $12.0 million as of June 30, 2002.  The borrowings bear
interest  at 7.2%.  Principal and interest are payable monthly.  Loan
proceeds, net of deferred loan costs, of $3.9 million, were  used  to
pay down borrowings under the Company's credit facilities and to fund
operations.

      In April 2002, the Company completed a three-year, $5.5 million
financing  agreement  secured by a terminal property  of  a  Canadian
subsidiary.   The  terminal  property  had  a  net  book   value   of
approximately $0.4 million as of June 30, 2002.  The borrowings  bear
interest at 6.25%.  Principal and interest are payable monthly  using
a 25-year amortization schedule, with a remaining lump sum payment at
the end of the three-year period. Loan proceeds, net of deferred loan
costs,  of  $5.4 million were used to pay down borrowings  under  the
Company's credit facilities and to fund operations.

      In  June 2002, the Company completed an $18.9 million financing
agreement  secured by terminal properties.  Under the agreement,  the
Company  contributed 3 terminal properties with a net book  value  of
approximately  $22.1  million to CFCD  2002A  LLC,  a  wholly  owned,
consolidated  special  purpose company.   CFCD  2002A  LLC  used  the
properties as collateral for the borrowings. Borrowings bear interest
at  13%.  Interest payments are due monthly with principal due  in  3
years.   Loan proceeds, net of deferred loan costs, of $17.4  million
were   used  to  pay  down  borrowings  under  the  Company's  credit
facilities and to fund operations.

      The  following  are the Company's contractual cash  obligations
under   its  operating  lease,  capital  lease  and  long-term   debt
agreements and interest thereon as of June 30, 2002.

Contractual Cash Obligations
As of June 30, 2002
(Dollars in thousands)

                                 Payments Due In
                           Less than  1 to 3    4 to 5    After
                               1      Years      Years      5       Total
                             Year                         Years
Operating Leases           $28,615   $49,160   $18,839   $13,869   $110,483

Capital Lease
  Obligation                   121       271       314        72        778
Long-Term Debt               4,940    46,883     5,302    37,898     95,023
Interest on
Long-Term Debt and
  Capital Lease
  Obligation (a)             6,874    11,629     4,986    12,557     36,046

Total                      $40,550  $107,943   $29,441   $64,396   $242,330

(a) Assumes no change in LIBOR.


OTHER

Recent Accounting Pronouncements

      Please  refer  to Footnote 8 "Recent Accounting Pronouncements"
under  Part  I,  Item I "Financial Statements" for  a  discussion  of
recent accounting pronouncements.


Changes in Senior Management

     On May 28, 2002, the Board of Directors named John P. Brincko as
president and chief executive officer and elected him to the Board of
Directors.   He  replaced  Patrick H. Blake,  who  retired  from  the
Company  and the Board.  On July 2, 2002, Stephen S. Sokol was  named
executive vice president of finance and chief financial officer.   He
succeeds  Robert E. Wrightson, who retired from the Company.   Thomas
A.  Paulsen,  who  was executive vice president and  chief  operating
officer, left the Company. Robert E. Warner, previously an operations
vice  president,  was  named  executive vice  president  of  terminal
operations.    Phillip  W.  Seeley,  previously  vice  president   of
administration,  was  named  executive  vice  president  of   process
improvement.


Forward Looking Statements

     Certain   statements  in  this  Form  10-Q  are  forward-looking
statements  that  are  subject to material risks  and  uncertainties.
Investors are cautioned that any such forward-looking statements  are
not guarantees of future performance or results and involve risks and
uncertainties,  and  that actual results or developments  may  differ
materially  from  those expressed or implied in  the  forward-looking
statements  as  a  result  of  various  factors.   These  risks   and
uncertainties include, but are not limited to, uncertainties relating
to  general  economic and business conditions, the  availability  and
cost  of capital, government and regulatory policies and  changes  in
the  competitive  environment in which the Company  operates.   These
risks  and  uncertainties also include matters  arising  out  of  the
Company's delay in filing with the Securities and Exchange Commission
its  Form  10-Q for the quarter ended June 30, 2002, the  Chapter  11
bankruptcy filing, liquidity short falls and the announced  delisting
of  CFC's  common stock by Nasdaq.  Additional information  regarding
risks,  uncertainties and other factors that may affect the  business
and  financial  results of the company can be found in the  Company's
filings  with  the Securities and Exchange Commission.   The  Company
does  not undertake to update any forward-looking statements in  this
Form 10-Q or with respect to matters described herein.


ITEM 3. Quantitative and Qualitative Disclosures About Market Risk

     The  Company  is subject to market risks related to  changes  in
interest rates.  As of June 30, 2002, approximately $50.0 million  of
the  Company's  long-term debt was at variable interest  rates.   The
Company  does not currently use derivative instruments to manage  the
risk  of  change  in interest rates; however, it may  do  so  in  the
future.    A  theoretical  10% change in the  interest  rate  on  the
Company's  variable  rate long-term debt would not  have  a  material
adverse  effect  on the Company's financial position  or  results  of
operations.   Please refer to the Cash Contractual Obligations  table
in the Liquidity Section above.

     The  Company is also subject to market risks related to  changes
in foreign currency exchange rates, primarily the Canadian dollar and
Mexican  peso.  Management believes that the impact on the  Company's
financial  position,  results  of  operations  and  cash  flows  from
fluctuations  in  foreign  currency  exchange  rates  would  not   be
material.  Consequently, management does not currently use derivative
instruments  to  manage these risks; however, it may  do  so  in  the
future.

ITEM 4.  Controls and Procedures.

     There  were  no significant changes in internal controls  or  in
other   factors  that  could  significantly  affect  these   controls
subsequent to management's evaluation.

                     PART II. OTHER INFORMATION

ITEM 1.  Legal Proceedings

     Please refer to Footnote 10 "Contingencies" under Part I, Item I
"Financial Statements."


ITEM 4.  Submission of Matters to a Vote of Security Holders

      At  the  Annual Shareholders Meeting held June  17,  2002,  the
following matters were presented with the indicated voting results:

      For  the purpose of electing members of the Board of Directors,
the votes representing shares of Common stock were cast as follows:

                 Nominee                 For              Withheld
            Robert W. Hatch          17,815,927          1,334,317
            Henry C. Montgomery      17,810,574          1,339,670

      Because the terms of office for their classes of directors  had
not  ended,  the following directors did not stand for  election  and
continued in office after the Annual Shareholders Meeting: G.  Robert
Evans,  Paul B. Guenther, James B. Malloy, and William D. Walsh.   As
discussed  above,  John  P.  Brincko was  elected  to  the  Board  of
Directors on May 28, 2002, replacing Patrick H. Blake who retired.

     For  the  purpose of approving the 2002 Stock  Plan,  the  votes
representing  shares  of  Common stock were  cast  as  follows:  For,
14,897,901; Against, 3,951,237; Abstain, 301,106.


ITEM 5.  Stockholder Proposals

     Pursuant to the Company's bylaws, stockholders who wish to bring
matters or propose nominees for director at the Company's 2003 annual
meeting  of  stockholders must provide specified information  to  the
Company  between  February 21, 2003 and March 23, 2003  (unless  such
matters  are  included in the Company's proxy statement  pursuant  to
Rule 14a-8 under the Securities Exchange Act of 1934, as amended,  in
which  case  the  information  must be received  by  the  Company  by
December 31, 2002).


ITEM 6.  Exhibits and Reports on Form 8-K

       (a)Exhibits

            10.01 Eighth Amendment, dated April 5, 2002, to the Credit
                  Agreement among Consolidated Freightways Corporation, as
                  Borrower and General Electric Capital Corporation, as
                  Lender, dated October 24, 2001.
            10.02 Ninth Amendment, dated April 15, 2002, to the Credit
                  Agreement among Consolidated Freightways Corporation, as
                  Borrower and General Electric Capital Corporation, as
                  Lender, dated October 24, 2001.


Exhibits (continued)

            10.03 Ninth Amendment, dated April 5, 2002, to the Letter
                  of Credit Agreement between Consolidated Freightways
                  Corporation and General Electric Capital Corporation
                  dated April 27, 2001.
            10.04 Tenth Amendment, dated April 15, 2002, to the Letter
                  of Credit Agreement between Consolidated
                  Freightways Corporation and General Electric
                  Capital Corporation dated April 27, 2001.
            10.05 Eighth Amendment, dated April 5, 2002, to the
                  Securitization Agreement between Consolidated Freightways
                  Corporation and General Electric Capital
                  Corporation dated April 27, 2001.
            10.06 Settlement Agreement and General Release of Claims
                  between Patrick H. Blake and Consolidated Freightways
                  Corporation dated as of May 28, 2002.
            10.07 Services Agreement between Brincko Associates, Inc.,
                  Consolidated Freightways Corporation and Consolidated
                  Freightways Corporation of Delaware, dated as of
                  May 28, 2002.
            10.08 Employment Agreement between Mr. Frits Kromhout, Consolidated
                  Freightways Corporation and Consolidated
                  Freightways Corporation of Delaware dated March 20, 2002.
            10.09 Amended and Restated Loan Agreement between
                  CFCD 2002A LLC and JDI Sterling LLC, dated June 7, 2002.
            99.1  Certification of Principal Executive Officer pursuant
                  to 18 U.S.C. Section 1350, as adopted pursuant to
                  Section 906 of the Sarbanes-Oxley Act of 2002.
            99.2  Certification of Principal Financial Officer pursuant
                  to 18 U.S.C. Section 1350, as adopted pursuant to
                  Section 906 of the Sarbanes-Oxley Act of 2002.


       (b)Reports on Form 8-K

                A Form 8-K was filed on April 19, 2002 announcing the
                funding of the remaining $25 million of a $45 million
                financing agreement secured in February 2002.

                A Form 8-K was filed on May 28, 2002 announcing the
                dismissal of Arthur Andersen LLP and the engagement of
                KPMG LLP to serve as the Company's independent public
                accountants.

                A Form 8-K was filed on May 29, 2002 announcing the
                appointment of John P. Brincko as president and chief
                executive officer and a member of the Board of Directors.




                             SIGNATURES

      Pursuant to the requirements of the Securities Exchange Act  of
1934,  Registrant has duly caused this Form 10-Q Quarterly Report  to
be   signed  on  its  behalf  by  the  undersigned,  thereunto   duly
authorized.


                                Consolidated Freightways Corporation
                                          (Registrant)


September 3, 2002                    /s/Stephen Sokol
                                    Stephen Sokol
                                    Executive Vice President of
                                     Finance and Chief Financial
                                     Officer


September 3, 2002
                                     /s/James R. Tener
                                     James R. Tener
                                     Vice President and Controller


                           CERTIFICATIONS

I, John Brincko, certify that:

1.I have reviewed this quarterly report on Form 10-Q of Consolidated
  Freightways Corporation;

2.Based on my knowledge, this quarterly report does not contain any
  untrue statement of a material fact or omit to state a material fact
  necessary to make the statements made, in light of the circumstances
  under which such statements were made, not misleading with respect to
  the period covered by this quarterly report; and

3.Based on my knowledge, the financial statements, and other
  financial information included in this quarterly report, fairly
  present in all material respects the financial condition, results of
  operations and cash flows of the registrant as of, and for, the
  periods presented in this quarterly report.


Date:  September 3, 2002

/s/John Brincko
John Brincko
Chief Executive Officer




I, Stephen Sokol, certify that:

1.I have reviewed this quarterly report on Form 10-Q of Consolidated
  Freightways Corporation;

2.Based on my knowledge, this quarterly report does not contain any
  untrue statement of a material fact or omit to state a material fact
  necessary to make the statements made, in light of the circumstances
  under which such statements were made, not misleading with respect to
  the period covered by this quarterly report; and

3.Based on my knowledge, the financial statements, and other
  financial information included in this quarterly report, fairly
  present in all material respects the financial condition, results of
  operations and cash flows of the registrant as of, and for, the
  periods presented in this quarterly report.


Date:  September 3, 2002

/s/Stephen Sokol
Stephen Sokol
Chief Financial Officer