---

---

UNITED STATES
SECURITIES AND EXCHANGE COMMISSIONWASHINGTON, D.C. 20549

---

FORM 10-Q

---

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

For the quarterly period ended July 31, 2001

Commission file no: 1-6458

---

JOHN DEERE CAPITAL CORPORATION

Delaware(State of incorporation)

36-2386361(IRS employer identification no.)


1 East First Street, Suite 600
Reno, Nevada 89501(Address of principal executive offices)

Telephone
Number:(775) 786-5527

---

Indicate
by check mark whether the registrant (1) has filed all reports required to be filed by Section 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 / /

At
July 31, 2001, 2,500 shares of common stock, without par value, of the registrant were outstanding, all of which were owned by John Deere Credit Company, a wholly-owned
subsidiary of Deere & Company.

The
registrant meets the conditions set forth in General Instruction H(1)(a) and (b) of Form 10-Q and is therefore filing this Form with certain reduced
disclosures as permitted by those instructions.

---

---

Page
1 of 19 Pages
Index to Exhibits: Page 18

---



PART I.    FINANCIAL INFORMATION

Item 1.Financial Statements

John Deere Capital Corporation and Subsidiaries  Statements of Consolidated Income and Retained Earnings  (Unaudited)  (in millions)

|                                                     |                                             | Three Months Ended
July 31,                   |                          | Nine Months Ended
July 31, |     
|---------------------------------------------------- | ------------------------------------------- | --------------------------------------------- | ------------------------ | -------------------------- | ----
|
|Revenues                                             |                                             |                                               |                          |                            |     
|                                                     | Finance income earned on retail notes       |                                               | $                        | 115.0                      |     
|                                                     | Lease revenues                              |                                               |                          | 110.6                      |     
|                                                     | Finance income earned on wholesale notes    |                                               |                          | 17.2                       |     
|                                                     | Revolving charge account income             |                                               |                          | 33.2                       |     
|                                                     | Operating loan income                       |                                               |                          | 8.8                        |     
|                                                     | Securitization and servicing fee income     |                                               |                          | 7.2                        |     
|                                                     | Net gain on receivables and leases sold     |                                               |                          | 3.8                        |     
|                                                     | Interest income from short-term investments |                                               |                          | 1.6                        |     
|                                                     | Other income                                |                                               |                          | 5.6                        |     
|                                                     |                                             |                                               |                          |                            |     
|                                                     |                                             |                                               | Total revenues           |                            |     
|                                                     |                                             |                                               |                          |                            |     
|Expenses                                             |                                             |                                               |                          |                            |     
|                                                     | Interest expense                            |                                               |                          | 113.5                      |     
|                                                     | Operating expenses:                         |                                               |                          |                            |     
|                                                     |                                             | Administrative and operating expenses         |                          |                            | 40.2
|                                                     |                                             | Provision for credit losses                   |                          |                            | 21.9
|                                                     |                                             | Fees paid to John Deere                       |                          |                            | 3.9 
|                                                     |                                             | Depreciation of equipment on operating leases |                          |                            | 66.5
|                                                     |                                             |                                               |                          |                            |     
|                                                     |                                             |                                               | Total operating expenses |                            |     
|                                                     |                                             |                                               |                          |                            |     
|                                                     |                                             |                                               | Total expenses           |                            |     
|                                                     |                                             |                                               |                          |                            |     
|Income of consolidated group before income taxes     |                                             |                                               | 57.0                     |                            |     
|Provision for income taxes                           |                                             |                                               | 20.0                     |                            |     
|                                                     |                                             |                                               |                          |                            |     
|Income of consolidated group                         |                                             |                                               | 37.0                     |                            |     
|Equity in income (loss) of unconsolidated affiliates |                                             |                                               | (1.0                     | )                          |     
|                                                     |                                             |                                               |                          |                            |     
|Net income                                           |                                             |                                               | 36.0                     |                            |     
|Cash dividends declared                              |                                             |                                               |                          |                            |     
|Retained earnings at beginning of period             |                                             |                                               | 1,085.4                  |                            |     
|                                                     |                                             |                                               |                          |                            |     
|Retained earnings at end of period                   |                                             | $                                             | 1,121.4                  |                            | $   
|                                                     |                                             |                                               |                          |                            |     

See
Notes to Interim Financial Statements.

2

---



John Deere Capital Corporation and Subsidiaries  Consolidated Balance Sheets  (Unaudited)  (in millions)

|                                           |                                              | July 31,
2001                                                                                            |                                                | October 31,
2000 |         | July 31,
2000 |      
|------------------------------------------ | -------------------------------------------- | -------------------------------------------------------------------------------------------------------- | ---------------------------------------------- | ---------------- | ------- | ------------- | -----
|Assets                                     |                                              |                                                                                                          |                                                |                  |         |               |      
|                                           | Cash and cash equivalents                    |                                                                                                          | $                                              | 109.7            |         | $             | 155.9
|                                           | Receivables and leases:                      |                                                                                                          |                                                |                  |         |               |      
|                                           |                                              | Retail notes                                                                                             |                                                |                  | 5,085.8 |               |      
|                                           |                                              | Wholesale notes                                                                                          |                                                |                  | 723.2   |               |      
|                                           |                                              | Revolving charge accounts                                                                                |                                                |                  | 779.4   |               |      
|                                           |                                              | Operating loans                                                                                          |                                                |                  | 518.4   |               |      
|                                           |                                              | Financing leases                                                                                         |                                                |                  | 456.1   |               |      
|                                           |                                              |                                                                                                          |                                                |                  |         |               |      
|                                           |                                              |                                                                                                          | Total receivables                              |                  |         | 7,562.9       |      
|                                           |                                              | Equipment on operating leasesnet                                                                        |                                                |                  | 1,489.3 |               |      
|                                           |                                              |                                                                                                          |                                                |                  |         |               |      
|                                           |                                              |                                                                                                          | Total receivables and leases                   |                  |         | 9,052.2       |      
|                                           |                                              | Allowance for credit losses                                                                              |                                                |                  | (99.0   | )             |      
|                                           |                                              |                                                                                                          |                                                |                  |         |               |      
|                                           |                                              |                                                                                                          | Total receivables and leasesnet               |                  |         | 8,953.2       |      
|                                           |                                              |                                                                                                          |                                                |                  |         |               |      
|                                           | Notes receivableunconsolidated affiliates   |                                                                                                          |                                                | 243.7            |         |               | 140.0
|                                           | Notes receivableJohn Deere                  |                                                                                                          |                                                | 27.0             |         |               |      
|                                           | Other receivables                            |                                                                                                          |                                                | 81.5             |         |               | 86.2 
|                                           | Investment in unconsolidated affiliates      |                                                                                                          |                                                | 5.2              |         |               | 9.7  
|                                           | Other assets                                 |                                                                                                          |                                                | 211.0            |         |               | 130.8
|                                           |                                              |                                                                                                          |                                                |                  |         |               |      
|Total Assets                               |                                              | $                                                                                                        | 9,631.3                                        |                  | $       | 9,038.0       |      
|                                           |                                              |                                                                                                          |                                                |                  |         |               |      
|Liabilities and Stockholder's Equity       |                                              |                                                                                                          |                                                |                  |         |               |      
|                                           | Short-term borrowings:                       |                                                                                                          |                                                |                  |         |               |      
|                                           |                                              | Commercial paper                                                                                         |                                                | $                | 1,573.7 |               | $    
|                                           |                                              | Extendible commercial notes and other notes payable                                                      |                                                |                  | 23.3    |               |      
|                                           |                                              | John Deere                                                                                               |                                                |                  |         |               |      
|                                           |                                              | Current maturities of long-term borrowings                                                               |                                                |                  | 2,798.4 |               |      
|                                           |                                              |                                                                                                          |                                                |                  |         |               |      
|                                           |                                              |                                                                                                          | Total short-term borrowings                    |                  |         | 4,395.4       |      
|                                           |                                              |                                                                                                          |                                                |                  |         |               |      
|                                           | Accounts payable and accrued liabilities:    |                                                                                                          |                                                |                  |         |               |      
|                                           |                                              | Accrued interest on debt                                                                                 |                                                |                  | 64.9    |               |      
|                                           |                                              | Other payables                                                                                           |                                                |                  | 499.5   |               |      
|                                           |                                              |                                                                                                          |                                                |                  |         |               |      
|                                           |                                              |                                                                                                          | Total accounts payable and accrued liabilities |                  |         | 564.4         |      
|                                           |                                              |                                                                                                          |                                                |                  |         |               |      
|                                           | Deposits withheld from dealers and merchants |                                                                                                          |                                                | 131.6            |         |               | 132.6
|                                           |                                              |                                                                                                          |                                                |                  |         |               |      
|                                           | Long-term borrowings:                        |                                                                                                          |                                                |                  |         |               |      
|                                           |                                              | Senior debt                                                                                              |                                                |                  | 3,201.5 |               |      
|                                           |                                              | Subordinated debt                                                                                        |                                                |                  | 150.0   |               |      
|                                           |                                              |                                                                                                          |                                                |                  |         |               |      
|                                           |                                              |                                                                                                          | Total long-term borrowings                     |                  |         | 3,351.5       |      
|                                           |                                              |                                                                                                          |                                                |                  |         |               |      
|                                           |                                              |                                                                                                          | Total liabilities                              |                  |         | 8,442.9       |      
|                                           |                                              |                                                                                                          |                                                |                  |         |               |      
|                                           | Stockholder's equity:                        |                                                                                                          |                                                |                  |         |               |      
|                                           |                                              | Common stock, without par value (issued and outstanding2,500 shares owned by John Deere Credit Company) |                                                |                  | 112.8   |               |      
|                                           |                                              | Retained earnings                                                                                        |                                                |                  | 1,121.4 |               |      
|                                           |                                              | Accumulated other comprehensive income (loss)                                                            |                                                |                  | (45.8   | )             |      
|                                           |                                              |                                                                                                          |                                                |                  |         |               |      
|                                           |                                              |                                                                                                          | Total stockholder's equity                     |                  |         | 1,188.4       |      
|                                           |                                              |                                                                                                          |                                                |                  |         |               |      
|Total Liabilities and Stockholder's Equity |                                              | $                                                                                                        | 9,631.3                                        |                  | $       | 9,038.0       |      
|                                           |                                              |                                                                                                          |                                                |                  |         |               |      

See
Notes to Interim Financial Statements.

3

---



John Deere Capital Corporation and Subsidiaries  Statements of Consolidated Cash Flows  (Unaudited)  (in millions)

|                                                     |                                                                                   | Nine Months Ended
July 31,                          |                                          
|---------------------------------------------------- | --------------------------------------------------------------------------------- | --------------------------------------------------- | -----------------------------------------
|
|Cash Flows from Operating Activities:                |                                                                                   |                                                     |                                          
|                                                     | Net income                                                                        |                                                     | $                                        
|                                                     | Adjustments to reconcile net income to net cash provided by operating activities: |                                                     |                                          
|                                                     |                                                                                   | Provision for credit losses                         |                                          
|                                                     |                                                                                   | Provision for depreciation and amortization         |                                          
|                                                     |                                                                                   | Undistributed earnings of unconsolidated affiliates |                                          
|                                                     |                                                                                   | Other                                               |                                          
|                                                     |                                                                                   |                                                     |                                          
|                                                     |                                                                                   |                                                     | Net cash provided by operating activities
|                                                     |                                                                                   |                                                     |                                          
|Cash Flows from Investing Activities:                |                                                                                   |                                                     |                                          
|                                                     | Cost of Receivables acquired                                                      |                                                     |                                          
|                                                     | Collections of Receivables                                                        |                                                     |                                          
|                                                     | Cost of operating leases acquired                                                 |                                                     |                                          
|                                                     | Proceeds from sale of equipment on operating leases                               |                                                     |                                          
|                                                     | Change in notes receivableunconsolidated affiliates                              |                                                     |                                          
|                                                     | Proceeds from sales of receivables                                                |                                                     |                                          
|                                                     | Acquisition of business                                                           |                                                     |                                          
|                                                     | Other                                                                             |                                                     |                                          
|                                                     |                                                                                   |                                                     |                                          
|                                                     |                                                                                   |                                                     | Net cash used for investing activities   
|                                                     |                                                                                   |                                                     |                                          
|Cash Flows from Financing Activities:                |                                                                                   |                                                     |                                          
|                                                     | Change in commercial paper                                                        |                                                     |                                          
|                                                     | Change in extendible commercial notes and other notes payable                     |                                                     |                                          
|                                                     | Change in receivable from/payable to John Deere                                   |                                                     |                                          
|                                                     | Proceeds from issuance of long-term borrowings                                    |                                                     |                                          
|                                                     | Principal payments on long-term borrowings                                        |                                                     |                                          
|                                                     | Dividends paid                                                                    |                                                     |                                          
|                                                     |                                                                                   |                                                     |                                          
|                                                     |                                                                                   |                                                     | Net cash provided by financing activities
|                                                     |                                                                                   |                                                     |                                          
|Effect of Exchange Rate Changes on Cash              |                                                                                   |                                                     | (0.2                                     
|                                                     |                                                                                   |                                                     |                                          
|Net increase (decrease) in cash and cash equivalents |                                                                                   |                                                     | (46.2                                    
|Cash and cash equivalents at beginning of period     |                                                                                   |                                                     | 155.9                                    
|                                                     |                                                                                   |                                                     |                                          
|Cash and cash equivalents at end of period           |                                                                                   | $                                                   | 109.7                                    
|                                                     |                                                                                   |                                                     |                                          

See
Notes to Interim Financial Statements.

4

---



John Deere Capital Corporation and Subsidiaries  Notes to Interim Financial Statements  (Unaudited)



5

---

6

---

Three Months Ended
July 31,

Nine Months Ended
July 31,2001

2000

2001

2000Net income

$
36.0

$
40.5

$
115.9

$
109.1Other comprehensive income (loss), net of tax:Change in cumulative translation adjustment


(1.0
)

(1.3
)

(0.4
)

(3.8
)Unrealized loss on derivatives


(0.6
)




(35.2
)Comprehensive income

$
34.4

$
39.2

$
80.3

$
105.3


7

---



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

Results of Operations

Net income was $36.0 million for the third quarter and $115.9 million for the first nine months of 2001, compared with $40.5 million and
$109.1 million, respectively, last year. The decrease for the third quarter was primarily due to lower gains from sales of retail notes and higher receivable write-offs. The
year-to-date increase was primarily due to higher income from a larger portfolio.

Revenues
totaled $303.0 million and $909.5 million for the third quarter and for the first nine months of 2001, respectively, compared to $292.5 million and
$804.9 million for the same periods a year ago. Revenues increased primarily due to a 12 percent increase in the average balance of Receivables and Leases financed during the first nine
months of the year. Finance income earned on retail notes totaled $337.8 million for the first nine months of 2001, compared to $294.7 million for the same period in 2000. This increase
was primarily due to the increase in the average balance of retail notes financed. Lease revenues increased $43.0 million, to $325.1 million in the first nine months of 2001, from
$282.1 million in the first nine months of 2000, due to an 8 percent increase in the average balance of financing and operating leases. Finance income earned on wholesale notes decreased
$8.0 million, to $60.6 million for the first nine months of 2001, from $68.6 million in the first nine months of 2000. This decrease occurred primarily because the Company
discontinued offering wholesale note financing for manufactured housing, recreational vehicle and yacht dealer inventories. Revolving charge account income was $88.9 million for the first nine
months of 2001, compared to $78.8 million during the same period last year. Operating loan income increased $5.1 million to $26.6 million, from $21.5 million in the first
nine months of 2000.

Net
gains on the sales of retail notes, including adjustments to prior sales, totaled $3.8 million and $20.7 million for the third quarter and for the first nine months
of 2001, respectively, compared to $10.0 million and $17.0 million for the same periods a year ago. The decrease for the quarter, compared to last year, was primarily due to the sale of
agricultural retail notes (approximately $600 million total principal value) during the third quarter of 2000, without a comparable transaction this year. The
year-to-date increase, compared to last year, was primarily related to increased sales of recreational product retail notes during the first nine months of 2001. Additional
sales of Receivables and Leases are expected to occur in the future.

Interest
expense totaled $113.5 million for the third quarter of 2001 and $356.7 million for the first nine months of 2001, compared to $116.7 million and
$319.2 million for the same periods in 2000. This year to date increase was primarily due to average borrowings increasing 11 percent to $7,184 million in the first nine months of
2001 compared to $6,475 million in the first nine months of 2000.

Administrative
and operating expenses were $40.2 million in the third quarter of 2001 and $119.7 million for the first nine months of 2001, compared with
$37.0 million and $106.2 million for the same periods in 2000. These increases were attributable to the higher costs associated with administering a larger Receivable and Lease
portfolio. Depreciation of equipment on operating leases increased to $66.5 million in the third quarter of 2001 and $189.9 million for the first nine months of 2001, compared to
$58.2 million and $162.6 million for the same periods in 2000. This was a result of the increase in the average balance of equipment on operating leases.

During
the third quarter and the first nine months of 2001, the provision for credit losses totaled $21.9 million and $50.1 million, respectively, compared with
$14.9 million and $40.7 million in the same periods last year. These increases were primarily due to increased write-offs and a larger portfolio financed. The annualized
provision for credit losses, as a percentage of the total average balance of Receivables and Leases financed, was 1.01 percent for the third quarter of 2001 and .78 percent for the first
nine months of 2001, compared with .74 percent and .71 percent for the same periods last year.

8

---

Receivable and Lease acquisition volumes were as follows (in millions of dollars):

Three Months
Ended July 31,2001

2000

$ Change

% ChangeRetail notes:Agricultural equipment

$
695

$
495

$
200

40
%Construction equipment


251


190


61

32Lawn and grounds care equipment


140


105


35

33Recreational products


227


88


139

158Total


1,313


878


435

50Wholesale notes


256


395


(139
)
(35
)Revolving charge accounts


674


545


129

24Operating loans


269


208


61

29Financing leases


59


68


(9
)
(13
)Equipment on operating leases


158


134


24

18Total

$
2,729

$
2,228

$
501

22


Nine Months
Ended July 31,2001

2000

$ Change

% ChangeRetail notes:Agricultural equipment

$
1,957

$
1,804

$
153

8
%Construction equipment


598


508


90

18Lawn and grounds care equipment


282


235


47

20Recreational products


517


232


285

123Total


3,354


2,779


575

21Wholesale notes


711


1,158


(447
)
(39
)Revolving charge accounts


1,487


1,302


185

14Operating loans


766


496


270

54Financing leases


137


151


(14
)
(9
)Equipment on operating leases


432


512


(80
)
(16
)Total

$
6,887

$
6,398

$
489

8


Retail
note and operating loan volumes increased $575 and $270 million, respectively, in the first nine months of 2001. Recreational product retail note volumes increased
$285 million primarily due to increased marketing programs, more competitive pricing and the exit of competitors from the market. Operating loans increased due to increased marketing and
product exposure. These increases were partially offset by a decrease in wholesale note volumes in the first nine months of 2001 when compared to the same period last year. Wholesale note volume
decreased $447 million primarily because the Company discontinued offering wholesale note financing for manufactured housing, recreational vehicle and yacht dealer inventories.

9

---

Total Receivables and Leases held were as follows (in millions of dollars):

July 31,
2001

October 31,
2000

July 31,
2000Retail notes:Agricultural equipment

$
3,166

$
2,983

$
2,555Construction equipment


1,203


1,000


870Lawn and grounds care equipment


579


465


424Recreational products


138


140


140Total


5,086


4,588


3,989Wholesale notes


723


937


973Revolving charge accounts


780


689


684Operating loans


518


422


372Financing leases


456


456


438Equipment on operating leases


1,489


1,517


1,422Total

$
9,052

$
8,609

$
7,878


Receivables
and Leases administered by the Company were as follows (in millions of dollars):

July 31,
2001

October 31,
2000

July 31,
2000Receivables and Leases administered:Owned by the Company

$
9,052

$
8,609

$
7,878Sold and servicedwith limited recourse*


1,615


1,867


2,051Sold and servicedwithout recourse**


79


91


123Servicedwithout recourse***


12


24


24Total Receivables and Leases administered

$
10,758

$
10,591

$
10,076


---

10

---

Total
Receivable and Lease amounts 60 days or more past due, by product and as a percent of total balances held, were as follows (in millions of dollars):

|                          |                                 | July 31,
2001 |      | October 31,
2000 |      | July 31,
2000 |    
|------------------------- | ------------------------------- | ------------- | ---- | ---------------- | ---- | ------------- | ---
|
|Retail notes:             |                                 |               |      |                  |      |               |    
|                          | Agricultural equipment          |               | $    | 11.9             |      | .38           | %  
|                          | Construction equipment          |               |      | 6.6              |      | .55           |    
|                          | Lawn and grounds care equipment |               |      | 1.1              |      | .19           |    
|                          | Recreational products           |               |      | .1               |      | .07           |    
|                          |                                 |               |      |                  |      |               |    
|                          |                                 | Total         |      |                  | 19.7 |               | .39
|Wholesale notes           |                                 |               | 7.6  |                  | 1.05 |               |    
|Revolving charge accounts |                                 |               | 10.2 |                  | 1.31 |               |    
|Operating loans           |                                 |               | 1.1  |                  | .21  |               |    
|Leases                    |                                 |               | 9.1  |                  | .47  |               |    
|                          |                                 |               |      |                  |      |               |    
|                          |                                 | Total         |      | $                | 47.7 |               | .53
|                          |                                 |               |      |                  |      |               |    

The
balance of retail notes held (principal plus accrued interest) with any installment 60 days or more past due was $89 million, $68 million and
$71 million at July 31, 2001, October 31, 2000 and July 31, 2000, respectively. The balance of retail notes held on which any installment is 60 days or more past due
as a percent of retail notes held represented 1.75, 1.48 and 1.78 percent of the ending retail notes receivable at July 31, 2001, October 31, 2000 and July 31, 2000,
respectively.

During
the third quarter and the first nine months of 2001, write-offs (net of recoveries) of Receivables and Leases totaled $12.7 million and $38.2 million,
respectively, compared with $7.0 million and $23.5 million in the same periods last year. Annualized write-offs, as a percentage of the average total receivables and leases
held, were .59 percent for the third quarter and for the first nine months of 2001, compared with .34 percent and .41 percent for the same periods last year.
Write-offs relating to retail notes increased $6.9 million in the first nine months of 2001, when compared with the first nine months of 2000. These increases were primarily due to
increased write-offs of retail notes related to construction and forestry equipment as a result of a downturn in this industry. Wholesale note write-offs increased
$2.7 million in the first nine months of 2001 when compared to the same period last year primarily due to increased write-offs of recreational vehicle dealer inventory notes. Lease
write-offs increased $1.1 million in the first nine months of 2001 when compared to last year primarily due to higher write-offs on construction leases.

Deposits
withheld from dealers and merchants, representing mainly the aggregate dealer retail note and lease withholding accounts from individual John Deere dealers to which losses
from retail notes and leases originating from the respective dealers can be charged, amounted to $132 million at July 31, 2001, compared with $133 million at October 31,
2000 and $125 million at July 31, 2000.

The
Company's allowance for credit losses on all Receivables and Leases held totaled $99 million at July 31, 2001, $93 million at October 31, 2000 and
$95 million at July 31, 2000. The allowance for credit losses represented 1.09 percent of the total Receivables and Leases held at July 31, 2001, 1.08 percent at
October 31, 2000 and 1.20 percent at July 31, 2000. The allowance is subject to an ongoing evaluation based on loss experience. The Company believes the allowance is sufficient to
provide for losses in its existing Receivable and Lease portfolio.

11

---

FASB Statements to be Adopted

In June 2001, the Financial Accounting Standards Board (FASB) issued Statement No. 141, Business Combinations, which requires the purchase method
of accounting for business combinations and eliminates the pooling method effective June 30, 2001. Additionally, in June 2001, the FASB issued Statement No. 142, Goodwill and
Other Intangible Assets, which requires that goodwill related to acquisitions after June 30, 2001 not be amortized and only written down for impairments. Upon adoption of Statement
No. 142, the same accounting requirements will apply to goodwill related to acquisitions prior to June 30, 2001. The Company must adopt Statement No. 142 by the first quarter of
2003. In 2001, the Company did not have any goodwill or goodwill amortization. Finally, in July 2001, the FASB issued Statement No. 143, Accounting for Asset Retirement Obligations,
which requires obligations associated with the retirement of long-lived assets to be recorded as increases in costs of the related asset. These Statements are not expected to have a
material effect on the Company's financial position or net income.

Safe Harbor Statement

Statements under "Financial Instrument Risk Information" and other statements herein that relate to future operating periods are subject to important risks and
uncertainties that could cause actual results to differ materially. Interest rate changes by the Federal Reserve Board may affect the cost of financing the Company and the rates it is able to offer.
In addition, the Company's business is closely related to John Deere's business. Further information, including factors that potentially could materially affect the Company's and John Deere's
financial results, is included in the most recent Deere & Company Form 10-Q and other Deere & Company and Capital Corporation filings with the Securities and Exchange
Commission.

Capital Resources and Liquidity

The Company relies on its ability to raise substantial amounts of funds to finance its Receivables and Leases. The Company's primary source of funds for this
purpose is a combination of borrowings and equity capital. Additionally, the Company periodically sells substantial amounts of Receivables and Leases in the public market and in private sales. The
Company's ability to obtain funds is affected by its debt ratings, which are closely related to the outlook for and the financial condition of Deere & Company, and the nature and availability
of support facilities, such as its lines of credit. For information regarding Deere & Company and its business, see Exhibit 99.

The
Company's ability to meet its debt obligations is supported in a number of ways. All commercial paper issued is backed by bank credit lines. The assets of the Company are
self-liquidating in nature. A strong equity position is available to absorb unusual losses on these assets. Liquidity is also provided by the Company's ability to sell these assets.

The
Company's business is somewhat seasonal, with overall acquisition volumes of Receivables and Leases traditionally higher in the second half of the year than in the first half, and
overall collections of Receivables and Leases traditionally somewhat higher in the first six months than in the last six months of the year.

During
the first nine months of 2001, the aggregate net cash provided by operating and financing activities was primarily used to increase Receivables and Leases. Net cash provided by
operating activities was $420 million in the first nine months of 2001. Financing activities provided $388 million during the same period, resulting from a net increase in total
borrowings. Net cash used for investing activities totaled $854 million, in the first nine months of 2001, primarily due to Receivable and Lease acquisitions exceeding collections by
$2,383 million, which was partially offset by the $1,444 million in proceeds from the sale of receivables. Cash and cash equivalents decreased $46 million during the first nine
months of 2001. See "Statements of Consolidated Cash Flows."

12

---

During the first nine months of 2000, the aggregate net cash provided by operating and financing activities was primarily used to increase Receivables and Leases. Net cash provided by
operating activities was $407 million in the first nine months of 2000. Financing activities provided $600 million during the same period, resulting from a $615 million net
increase in total borrowings, which was partially offset by a $15 million dividend payment to John Deere Credit Company. Net cash used for investing activities totaled $994 million in
the first nine months of 2000, primarily due to Receivable and Lease acquisitions exceeding collections by $1,911 million, which was partially offset by the $879 million
in proceeds from the sale of receivables. Cash and cash equivalents increased $12 million during the first nine months of 2000.

Total
interest-bearing indebtedness amounted to $7,747 million at July 31, 2001, compared with $7,330 million at October 31, 2000 and $6,642 million
at July 31, 2000, generally corresponding with the level of Receivables and Leases financed and the level of cash and cash equivalents. Total short-term indebtedness amounted to
$4,395 million at July 31, 2001, compared with $4,743 million at October 31, 2000 and $3,787 million at July 31, 2000, while total long-term
indebtedness amounted to $3,352 million, $2,587 million and $2,855 million at these dates, respectively. The ratio of total interest-bearing debt to stockholder's equity was 6.5
to 1, 6.6 to 1 and 6.1 to 1 at July 31, 2001, October 31, 2000 and July 31, 2000, respectively.

During
the first nine months of 2001, the Company issued $200 million of floating rate notes due in 2003 and retired $200 million of 5.85% notes due in 2001. During the
same period, the Capital Corporation's subsidiary, John Deere Credit Limited in Gloucester, England, retired $56 million of long-term debt. The Capital Corporation's subsidiary,
John Deere Bank S.A., issued $231 million of medium-term notes and the Capital Corporation issued $2,450 million and retired $850 million of medium-term
notes during the first nine months of 2001.

At
July 31, 2001, the Capital Corporation and Deere & Company jointly maintained $4,274 million of unsecured lines of credit with various banks in North America
and overseas, $1,308 million of which were unused. For the purpose of computing unused credit lines, commercial paper and short-term bank borrowings, excluding the current portion
of long-term borrowings, of the Capital Corporation and Deere & Company, were considered to constitute utilization. These agreements include a $2,113 million
long-term bank credit agreement expiring on February 20, 2006. The facility fees payable under these credit agreements are divided between Deere & Company and the Capital
Corporation based on the proportion of their respective commercial paper outstanding.

Stockholder's
equity was $1,188 million at July 31, 2001, compared with $1,108 million at October 31, 2000 and $1,088 million at July 31,
2000. The increase of $80 million in the first nine months of 2001 resulted primarily from net income of $116 million, offset by an unrealized loss on derivatives of $35 million.
This loss is primarily due to an unrealized loss on interest rate swaps (pay fixed rates / receive floating rates) hedging the interest costs of the Company's short-term borrowings
resulting from a decrease in interest rates. If interest rates remain unchanged, the unrealized loss will be realized in income and will be offset by lower future interest expense on the Company's
short-term borrowings, which will be based on the lower interest rates.

The
Company has established a new subsidiary, Deere Capital, Inc., which will, among other things, purchase trade receivables from Deere & Company's equipment
operations. These purchases will begin on or about the end of the fiscal year. Deere & Company's Equipment Operations will also transfer the administration and servicing of the trade
receivables to the Company. The Company intends to fund the approximately $2.5 billion initial purchase with the proceeds of a $750 million equity infusion from Deere & Company
and an intercompany note payable to Deere & Company upon demand.

13

---



Item 3.Quantitative and Qualitative Disclosures About Market Risk.

Financial Instrument Risk Information

Sensitivity Analysis

The
following is a sensitivity analysis for the Company's derivatives and other financial instruments that have interest rate risk. These instruments are held for other than trading
purposes. The Company uses a combination of cash flow models to assess the sensitivity of earnings to changes in market interest rates. The models calculate the effect of adjusting interest rates as
follows. Cash flows for financing receivables are discounted at the prevailing rate for each receivable portfolio in effect at the end of the quarter. Cash flows for borrowings are discounted at the
treasury yield curve plus a market credit spread for similarly rated borrowers in similar industries. Cash flows for interest rate swaps are projected and discounted using forecasted rates from the
swap yield curve at the repricing dates as of the end of the quarter.

The
gains or losses in the following table represent the changes in the financial instruments fair values which would be caused by instantaneously increasing the interest rates by
10 percent of the current market rates at July 31, 2001. The gains or losses in fair values would have been as follows in millions of dollars:

Fair Value
Gains (Losses)
July 31, 2001Financing receivables

$
(40
)Interest rate swaps related to short- term borrowings


10Long-term borrowings and related swaps


19Interest rate and foreign currency swaps


(10
)Total

$
(21
)


Tabular Information

The following foreign exchange forward contracts were held by the company related to certain currency exposures. All contracts have maturity dates of less than
one year. The notional amounts and fair values in millions of dollars at July 31, 2001 were as follows:

Average
Contractual
Rate*

Notional Amount

Fair Value
Gains (Losses)Buy US$ / Sell Australian dollars

1.9348

$
181

$
2.6Buy US$ / Sell Euro

1.1684


89


(2.4
)Buy Swiss Francs / Sell Euro

0.6585


32


0.2Other




24


(0.2
)Total




326


0.2


---

14

---

The
Company held certain financial instruments in currencies other than the functional currencies. These amounts, in millions of dollars at July 31, 2001, were as follows:

|                                     |                        | Expected Maturity Date |     |    
|------------------------------------ | ---------------------- | ---------------------- | --- | ---
|
|Euro (FC)                            |                        |                        |     |    
|Short-term borrowings (US$)          |                        | $                      | 97  |    
|                                     | Average interest rates |                        |     | 3.7
|Short-term borrowings (Swiss Francs) |                        | $                      | 33  |    
|                                     | Average interest rates |                        |     | 3.3
|Australian Dollar (FC)               |                        |                        |     |    
|Short-term borrowings (US$)          |                        | $                      | 182 |    
|                                     | Average interest rates |                        |     | 3.8

---

15

---



PART II.    OTHER INFORMATION

Item 1.Legal Proceedings.

The
Company is subject to various unresolved legal actions which arise in the normal course of its business, the most prevalent of which relate to state and federal laws and
regulations concerning retail credit. Although it is not possible to predict with certainty the outcome of these unresolved legal actions or the range of possible loss, the Company believes these
unresolved legal actions will not have a material effect on its financial position or results of operations.

Item 2.Changes in Securities and Use of Proceeds.

Omitted
pursuant to instruction H(2).

Item 3.Defaults Upon Senior Securities.

Omitted
pursuant to instruction H(2).

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

Omitted
pursuant to instruction H(2).

Item 5.Other Information.

None.

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







16

---





SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned
thereunto duly authorized.

|                         |  | JOHN DEERE CAPITAL CORPORATION
|------------------------ |  | ------------------------------
|Date: September 13, 2001 |  | By:                           

17

---



INDEX TO EXHIBITS

|Exhibit |  |                                                                                                                                   |  | Page No.
|------- |  | --------------------------------------------------------------------------------------------------------------------------------- |  | --------
|(12)    |  | Computation of ratio of earnings to fixed charges                                                                                 |  | 19      
|(99)    |  | Part I of Deere & Company Form 10-Q for the quarter ended July 31, 2001
(Securities and Exchange Commission file number 1-4121*). |  |        

---

18

---

QuickLinks