<PAGE>

                                   Form 10-Q

                       SECURITIES AND EXCHANGE COMMISSION
                            WASHINGTON, D.C. 20549

               QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
[X]                 OF THE SECURITIES EXCHANGE ACT OF 1934
                 For the quarterly period ended June 30, 1999

                                      OR

               TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
[_]                 OF THE SECURITIES EXCHANGE ACT OF 1934
                For the transition period from ______ to ______

                         Commission file number 1-5666
                         -----------------------------

                            UNION TANK CAR COMPANY
            (Exact name of registrant as specified in its charter)

           Delaware                                   36-3104688
           --------                                   ----------
(State or other jurisdiction of                    (I.R.S. Employer
incorporation or organization)                  Identification Number)


              225 West Washington Street, Chicago, Illinois 60606
              ---------------------------------------------------
                   (Address of principal executive offices)


      Registrant's telephone number, including area code: (312) 372-9500

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

There is no voting stock held by non-affiliates of the registrant. This report
is being filed by the registrant as a result of undertakings made pursuant to
Section 15(d) of the Securities Exchange Act of 1934.

Included in this filing are 11 pages, sequentially numbered in the bottom
center of each page.

                                      -1-
<PAGE>

                   UNION TANK CAR COMPANY AND SUBSIDIARIIES
                                   FORM 10-Q
                                     INDEX

Part I. Financial Information                                          Page
                                                                       ----

     Item 1.  Financial Statements

              Condensed consolidated statement of income -
              three and six month periods ended
              June 30, 1999 and 1998                                     3

              Condensed consolidated balance sheet -
              June 30, 1999 and December 31, 1998                        4

              Condensed consolidated statement of cash flows -
              six months ended June 30, 1999 and 1998                    5

              Notes to condensed consolidated financial statements      6-7

     Item 2.  Management's Discussion and Analysis
              of Financial Condition and Results of Operations          8-9

     Item 3.  Quantitative and Qualitative Disclosures About
              Market Risk                                               10

Part II. Other Information

     Item 1.  Legal Proceedings                                         10

     Item 6.  Exhibits and Reports on Form 8-K                          10

Signatures                                                              11

                                      -2-
<PAGE>

                         PART 1. FINANCIAL INFORMATION


ITEM 1. FINANCIAL STATEMENTS

                    UNION TANK CAR COMPANY AND SUBSIDIARIES
                  CONDENSED CONSOLIDATED STATEMENT OF INCOME
                            (Dollars in Thousands)
                                  (Unaudited)


<TABLE>
<CAPTION>
                                  Three Months Ended        Six Months Ended
                                       June 30,                 June 30,
                                  ------------------        ----------------
                                  1999          1998        1999        1998
                                  ----          ----        ----        ----
<S>                               <C>           <C>         <C>         <C>
Revenues
  Services (leasing and other)    $156,697    $143,819     $310,016    $286,056
  Net sales                        100,631      71,211      173,818     124,588
                                  --------    --------     --------    --------

                                   257,328     215,030      483,834     410,644
Other income                         6,016       4,607       10,456      14,930
                                  --------    --------     --------    --------

                                   263,344     219,637      494,290     425,574
Costs and expenses
  Cost of services                  92,147      80,851      180,309     159,139
  Cost of sales                     87,417      60,074      148,354     104,591
  General and administrative        19,378      15,334       37,114      30,146
  Interest                          18,328      17,748       35,373      36,363
                                  --------    --------     --------    --------

                                   217,270     174,007      401,150     330,239
                                  --------    --------     --------    --------

Income before income taxes          46,074      45,630       93,140      95,335

Provision for income taxes
  Current                           13,227      10,183       26,543      29,405
  Deferred                           3,968       7,971        9,267       8,031
                                  --------    --------     --------    --------

                                    17,195      18,154       35,810      37,436
                                  --------    --------     --------    --------

Net income                        $ 28,879    $ 27,476     $ 57,330    $ 57,899
                                  ========    ========     ========    ========
</TABLE>

           See notes to condensed consolidated financial statements.

                                      -3-
<PAGE>

                    UNION TANK CAR COMPANY AND SUBSIDIARIES
                     CONDENSED CONSOLIDATED BALANCE SHEET
                            (Dollars in Thousands)

<TABLE>
<CAPTION>


                                                       June 30,   December 31,
                                                         1999         1998
                                                       --------   ------------
                                                      (Unaudited)
<S>                                                  <C>           <C>
Assets
------
Cash and cash equivalents                            $   71,489    $   58,423
Accounts receivable, primarily due within one year      107,807        82,729
Inventories                                              85,337        90,123
Prepaid expenses and deferred charges                    10,930        11,411
Advances to parent company,
  principally at LIBOR plus 1%                          208,572       130,940
Railcar lease fleet, net                              1,622,415     1,575,014
Fixed assets, net                                       189,477       177,055
Investment in aircraft direct financing lease            33,625        32,629
Other assets                                             51,115        53,851
                                                     ----------    ----------
  Total assets                                       $2,380,767    $2,212,175
                                                     ==========    ==========

Liabilities, Deferred Items and Stockholder's Equity
----------------------------------------------------

Accounts payable                                     $   23,345    $   20,082
Accrued liabilities                                     245,155       252,897
Borrowed debt, including $43,914 due within
  one year ($46,951 at December 31, 1998)             1,012,038       868,421
                                                     ----------    ----------
                                                      1,280,538     1,141,400

Deferred income taxes and investment tax credits        449,817       437,693


Stockholder's equity
  Common stock and additional capital                   113,035       113,035
  Retained earnings                                     537,377       520,047
                                                     ----------    ----------

    Total stockholder's equity                          650,412       633,082
                                                     ----------    ----------
    Total liabilities, deferred items and
        stockholder's equity                         $2,380,767    $2,212,175
                                                     ==========    ==========
</TABLE>

           See notes to condensed consolidated financial statements.

                                      -4-
<PAGE>


                    UNION TANK CAR COMPANY AND SUBSIDIARIES
                CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
                            (Dollars in Thousands)
                                  (Unaudited)

<TABLE>
<CAPTION>
                                                       Six Months Ended
                                                            June 30,
                                                       ----------------
                                                       1999         1998
                                                       ----         ----
<S>                                                   <C>         <C>
Cash flows from operating activities:
 Net income                                         $  57,330   $  57,899
 Adjustments to reconcile net income to net cash
  provided by operating activities:
   Depreciation and amortization                       64,906      60,538
   Deferred taxes                                       9,267       8,031
   Gain on disposition of railcars and
    other fixed assets                                 (2,660)     (1,157)
   Other non-cash income and expenses                   1,146         783
   Changes in assets and liabilities:
     Accounts receivable                              (22,448)     (3,170)
     Inventories                                        3,913     (15,080)
     Prepaid expenses and deferred charges                728        (500)
     Accounts payable and accrued expenses             (8,709)      1,431
                                                    ---------   ---------
Net cash provided by operating activities             103,473     108,775

Cash flows from investing activities:
 Construction and purchase of railcars and
  other fixed assets                                 (117,209)   (114,410)
 (Increase) decrease in advance to parent             (85,361)     17,522
 (Increase) in other assets                              (115)          -
 Purchases of businesses, net of cash acquired         (8,729)    (16,841)
 Proceeds from disposals of railcars and other
  fixed assets                                          5,092       3,165
                                                    ---------   ---------
Net cash used in investing activities                (206,322)   (110,564)

Cash flows from financing activities:
  Proceeds from issuance of borrowed debt             175,000           -
  Proceeds from sale-leaseback transactions            13,200     130,018
  Principal payments of borrowed debt                 (34,420)    (91,990)
  Cash dividends                                      (40,000)    (40,000)
                                                    ---------   ---------
Net cash provided (used in) by financing
 activities                                           113,780      (1,972)

Effect of exchange rates on cash and cash
 equivalents                                            2,135      (2,546)
                                                    ---------   ---------

Net increase (decrease) in cash and cash
 equivalents                                           13,066      (6,307)
Cash and cash equivalents at beginning of year         58,423      99,709
                                                    ---------   ---------

 Cash and cash equivalents at end of period         $  71,489   $  93,402
                                                    =========   =========
 Cash paid during the period for:
   Interest (net of amount capitalized)             $  34,861   $  37,643
   Income taxes                                        31,961      27,495
</TABLE>

           See notes to condensed consolidated financial statements.

                                      -5-
<PAGE>


                    UNION TANK CAR COMPANY AND SUBSIDIARIES
             NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                            (Dollars in Thousands)
                                  (Unaudited)

1.   UNION TANK CAR COMPANY (the "Company") is a wholly-owned subsidiary of
     Marmon Industrial LLC ("Marmon Industrial"). Marmon Industrial is a wholly-
     owned subsidiary of Marmon Holdings, Inc. ("Marmon Holdings"),
     substantially all of the stock of which is owned, directly or indirectly,
     by trusts for the benefit of certain members of the Pritzker family. As
     used herein, "Pritzker family" refers to the lineal descendants of Nicholas
     J. Pritzker, deceased.

2.   The accompanying unaudited condensed consolidated financial statements
     include all adjustments, consisting of normal recurring accruals, which
     the Company considers necessary for a fair presentation. These interim
     financial statements do not include all disclosures normally provided in
     annual financial statements. Accordingly, they should be read in
     conjunction with the consolidated financial statements and notes thereto in
     the Company's 1998 Annual Report on Form 10-K.

     The 1999 interim results presented herein are not necessarily indicative of
     the results of operations for the full year 1999.

3.   As more fully described in the Company's 1998 Annual Report on Form 10-K,
     under an arrangement with Marmon Industrial, the Company is included in the
     consolidated federal income tax return of Marmon Holdings. As a member of a
     consolidated federal income tax group, the Company is contingently liable
     for the federal income taxes of the other members of the group.

4.   The Company and its subsidiaries have been named as defendants in a number
     of lawsuits, and certain claims are pending. The Company has accrued what
     it reasonably expects to pay in resolution of these matters and, in the
     opinion of management, their ultimate resolution will not have a material
     effect on the Company's consolidated financial position or results of
     operations.

5.   Foreign currency translation adjustments and transaction gains and losses
     are assumed by the Company's parent. For the six months ended June 30, 1999
     and 1998, Marmon Industrial absorbed gains of $187 and $800, respectively.

6.   The Company's foreign subsidiaries periodically enter into foreign currency
     forward contracts to hedge against U.S. dollar exposures. Foreign currency
     forward contracts, all with initial maturities of less than one year,
     amounted to $3,400 at June 30, 1999 and $3,365 at December 31, 1998.

                                      -6-
<PAGE>


7.   Segment Information

<TABLE>
<CAPTION>
                                                                               Consolidated
                                         Railcar           All Other              Totals
                                       ----------      ----------------      ----------------
                                                     (Dollars in Millions)
<S>                                      <C>         <C>                     <C>
     Three months ended June 30, 1999
     --------------------------------
     Revenues from external customers   $ 205.7                $ 51.6              $ 257.3
     Income before income taxes            46.8                  (0.7)                46.1

     Three months ended June 30, 1998
     --------------------------------
     Revenues from external customers   $ 178.1                $ 36.9              $ 215.0
     Income before income taxes            47.5                  (1.9)                45.6

     Six months ended June 30, 1999
     ------------------------------
     Revenues from external customers   $ 383.4               $ 100.4              $ 483.8
     Income before income taxes            95.1                  (2.0)                93.1

     Six months ended June 30, 1998
     ------------------------------
     Revenues from external customers   $ 340.9               $  69.7              $ 410.6
     Income before income taxes            92.8                   2.5                 95.3
</TABLE>

8.   Summarized Financial Information of Procor Limited

     Summarized consolidated financial information for the Company's wholly-
     owned subsidiary, Procor Limited, in thousands of U.S. dollars, is as
     follows:

<TABLE>
<CAPTION>
                                                  June 30,         December 31,
                                                    1999              1998
                                               ------------      ---------------
     <S>                                        <C>               <C>
     Balance Sheet:
        Railcar lease fleet, net                $ 164,696           $ 165,270
        All other assets                          173,674             170,214
        Borrowed debt                              91,610              94,409
        All other liabilities                     102,837             109,431
</TABLE>

<TABLE>
<CAPTION>
                                     Three Months Ended               Six Months Ended
                                          June 30,                        June 30,
                                 --------------------------      --------------------------
                                    1999            1998            1999            1998
                                 ----------      ----------      ----------      ----------
     <S>                          <C>            <C>             <C>             <C>
     Statement of Income:
        Services and net sales    $ 29,542        $ 27,902       $ 59,455         $ 54,556
        Gross profit                 8,867           8,265         17,267           17,466
        Net income                   3,824           5,037          7,127            8,591
</TABLE>

9.   In May 1999, the Company issued $ 100,000 principal amount of Senior
     Secured Notes. The notes bear interest at 6.79% per annum and mature on
     May 1, 2010. Interest on the notes is payable semiannually on May 1 and
     November 1, commencing November 1, 1999.

                                      -7-
<PAGE>

ITEM 2.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
          RESULTS OF OPERATIONS

Results of Operations
---------------------
2nd Quarter 1999 versus 1998
----------------------------
Service revenues increased $12.9 million primarily due to the effects of
railcars added to the lease fleet and the acquisition in the fourth quarter of
1998 of a company which provides contract switching services.

Sales revenues increased $29.4 million primarily due to increased sales of
railcars and sales of mobile railcar moving vehicles by a company which was
acquired in the fourth quarter of 1998.

General and administrative expenses increased primarily due to acquisition of
businesses in 1998.

Six Months 1999 versus 1998
---------------------------
Service revenues increased $24.0 million primarily due to the effects of
railcars added to the lease fleet and the acquisition in the fourth quarter of
1998 of a company which provides contract switching services.

Sales revenues increased $49.2 million primarily due to increased sales of
railcars and sales of mobile railcar moving vehicles by a company which was
acquired in the fourth quarter of 1998.

Other income decreased $4.5 million primarily due to the 1998 sale of certain
rights retained as a condition of the May 1996 sale of a storage facility used
in the liquefied petroleum gas storage operations.

General and administrative expenses increased primarily due to acquisition of
businesses in 1998.

Financial Condition
-------------------
1999 versus 1998
----------------
Operating activities provided $103.5 million of cash. These funds, along with
the proceeds from the issuance of debt and sale-leaseback transactions were used
to provide for railcar additions, acquisition of businesses, service borrowed
debt obligations, and pay dividends to the Company's stockholder.

Management expects future cash to be provided from operating activities, long-
term financings and collection of funds previously advanced to parent will be
adequate to provide for continued expansion of the Company's business and enable
it to meet its debt service obligations.

Year 2000
---------
Because of the potential importance to the Company of Year 2000 questions, the
Company has established a Year 2000 program to determine the Company's state of
readiness and the costs it anticipates it will have to incur in light of any
possible problems and to remediate any problems discovered. The Company's Year
2000 assessment indicated that the Company's accounting, invoicing, general
business and fleet management systems would be affected by Year 2000 problems.
As of June 30, 1999, the Company has completed the necessary corrective work on
its coding, invoicing, general business and fleet management systems that would
be affected by Year 2000 problems. The Company's timetable calls for testing of
the systems to be done by September 1, 1999.

                                      -8-
<PAGE>

The Company does not believe its main products (i.e., tank cars and other rail
cars) have any material Year 2000 exposures. Similarly, no material problems
have been identified in connection with the Company's production machinery and
equipment.

The Company is using both in-house resources and outside consultants to
implement the necessary changes required by its Year 2000 program. The total
cost of the program is estimated to be $5.4 million, which will be funded from
operating cash flow. Through June 30, 1999, the Company has spent approximately
$4.1 million related to its Year 2000 program, of which $3.8 million has been
expensed and $0.3 million has been capitalized. Of the remaining amount,
approximately $0.5 million is expected to be capitalized with the balance being
expensed.

For further discussion of the Company's Year 2000 program and risks related
thereto, see "Management's Discussion and Analysis of Financial Condition and
Results of Operations" in the Company's Annual Report on Form 10-K for the year
ended December 31, 1998.

                                      -9-
<PAGE>

ITEM 3.   QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

At June 30, 1999, there has been no significant change to the Company's exposure
to market risk since December 31, 1998.

                          PART II. OTHER INFORMATION

Item 1.   Legal Proceedings

          Reference is made to "Business - Environmental Matters" in the
          Company's Annual Report on Form 10-K for the year ended December 31,
          1998 for a description of certain environmental matters.

Item 6.   Exhibits and Reports on Form 8-K

     b.   Report on Form 8-K

          On May 5, 1999, the Company filed a Current Report on Form 8-K
          disclosing that on April 28, 1999, the Company entered into a Selling
          Agency Agreement with Salomon Smith Barney Inc. relating to the
          issuance and sale of $25,000,000 principal amount of Medium-Term
          Notes, Series D.

                                      -10-
<PAGE>

                                  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.

                                       UNION TANK CAR COMPANY

                                       REGISTRANT



Dated: August 4, 1999                  /s/ R.C. Gluth
                                       --------------
                                           R.C. Gluth
                                       Executive Vice President,
                                        Director and Treasurer
                                        (principal financial officer
                                        and principal accounting
                                        officer)

                                      -11-