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

                                    FORM 10-Q

(Mark One)

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

                 For the quarterly period ended March 31, 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:  0-24804

                               Featherlite, Inc.
             (Exact name of registrant as specified in its charter)

Minnesota                                                      41-1621676
(State or other jurisdiction of                            (I.R.S. Employer
incorporation or organization)                            Identification No.)

                Highways 63 & 9, P.O. Box 320, Cresco, IA 52136
              (Address of principal executive offices) (Zip Code)

                                  319/547-6000
              (Registrant's telephone number, including area code)

--------------------------------------------------------------------------------
              (Former name, former address and former fiscal year,
                         if changed since last report)

     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. [ X ] Yes [ ] No

                APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
                  PROCEEDINGS DURING THE PRECEEDING FIVE YEARS:

     Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Sections 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court.                  [  ] Yes       [  ] No

                      APPLICABLE ONLY TO CORPORATE ISSUERS:

     Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date.

                       6,500,051 Shares as of May 13, 1999



<PAGE>


                                FEATHERLITE, INC.

                                      INDEX



                                                                       Page No.
Index . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  2

Part I.  Financial Information:

Item 1.  Financial Statements (Unaudited)

    Condensed Balance Sheets
    March 31, 1999 and December 31, 1998  . . . . . . . . . . . . . . . .  3

    Condensed Statements of Income
    Three Months Ended March 31, 1999 and 1998. . . . . . . . . . . . . .  4

    Condensed Statements of Cash Flows
    Three months Ended March 31, 1999 and 1998 . .  . . . . . . . . . . .  5

    Notes to Financial Statements  . . . . . . . . . . . . . . . . . . . . 6

Item 2.   Management's Discussion and Analysis of
          Financial Condition and Results of Operations  . . . . . . . .  11

Item 3.   Quantitative and Qualitative Disclosures about Market Risks . . 15

Part II. Other Information:

Item 6.   Exhibits and Reports on Form 8-K . . . . . . . . . . . . . . .  16

          Signatures   . . . . . . . . . . . . . . . . . . . . . . . . .  17

          Exhibit Index . . . . . . . . . . . . . . . . . . . . . . . .   18



                                       2

<PAGE>


                          Part I: FINANCIAL INFORMATION

Item 1:

              Featherlite, Inc.
              Condensed Balance Sheets
              (Unaudited)
              (In thousands)

<TABLE>
<CAPTION>


                                                                  March 31,            December 31,
                                     ASSETS                         1999                   1998
                                                                  --------             -----------
<S>                                                             <C>                  <C>    
Current Assets
  Cash                                                          $     297            $       188
  Receivables                                                      12,588                 10,332
  Inventories
    Raw Materials                                                  12,738                 12,571
    Work in process                                                18,255                 18,817
    Finished trailers                                              31,362                 29,985
                                                                ---------            -----------
    Total inventories                                              62,355                 61,373
  Prepaid expenses                                                  1,805                  1,522
  Deferred taxes                                                    1,107                  1,107
                                                                ---------            -----------
  Total current assets                                             78,152                 74,522
                                                                ---------            -----------
Property and equipment                                             24,699                 23,692
  Less accumulated depreciation                                    (8,263)                (7,824)
                                                                ---------            -----------
  Property and equipment, net                                      16,436                 15,868

Goodwill and other assets                                          12,793                 16,398
                                                                ---------            -----------
                                                                $ 107,381            $   106,788
                                                                =========            ===========
                      LIABILITIES AND SHAREHOLDERS EQUITY  

Current Liabilities
  Current maturities of long term debt                          $   1,216            $     1,241
  Other notes payable                                              19,075                 17,936
  Accounts payable                                                 20,287                 18,221
  Accrued liabilities                                               7,417                  5,720
  Customer deposits                                                 3,004                  2,241
                                                                ---------            -----------
  Total current liabilities                                        50,999                 45,359
                                                                ---------            -----------
Long Term Debt, net of current maturities                          24,186                 30,914
Deferred Grant Income                                                 153                    164
Deferred taxes                                                        808                    808
Commitments and Contingencies (Note 5)
Shareholders' Equity                                               31,235                 29,543
                                                                ---------            -----------
                                                                $ 107,381            $   106,788
                                                                =========            ===========
See Notes to financial statements

</TABLE>

                                       3
<PAGE>



              Featherlite, Inc.
              Condensed Statements of Income
              (Unaudited)
     (In thousands, except for per share data)

<TABLE>
<CAPTION>

                                                                Three months Ended
                                                                     March 31
                                                     ------------------------------------------
                                                            1999                   1998
                                                     -------------------    -------------------
<S>                                                      <C>                    <C>    
Net Sales                                                $ 59,422               $ 41,742
Cost of Sales                                              49,725                 34,825
                                                         --------               --------
  Gross profit                                              9,697                  6,917
Selling and administrative expenses                         6,635                  4,661
                                                         --------               --------
  Income from operations                                    3,062                  2,256
Other income (expense)
  Interest                                                   (897)                  (576)
  Gain on aircraft and property sales                         211                     --
  Other, net                                                  217                    221
                                                         --------               --------
  Total other expense                                        (469)                  (355)
                                                         --------               --------
Income before taxes                                         2,593                  1,901
Provision for income taxes                                  1,050                    760
                                                         --------               --------
  Net income                                                1,543                  1,141
                                                         ========               ========

Net income per share - basic and diluted                 $   0.24               $   0.18
                                                         --------               --------
Weighted average shares outstanding - basic                 6,501                  6,255
                                                         --------               --------
Weighted average shares outstanding - diluted               6,506                  6,340
                                                         --------               --------

See Notes to financial statements

</TABLE>

                                       4
<PAGE>




              Featherlite, Inc.
              Condensed Statements of Cash Flows
              (Unaudited)
              (In thousands)
<TABLE>
<CAPTION>


                                                                                      Three months Ended
                                                                                           March 31
                                                                             -------------------------------------
                                                                                  1999                 1998
                                                                             ----------------    -----------------

<S>                                                                                <C>                  <C>   
Cash provided (used) by operating activities
  Net income                                                                       $ 1,543              $ 1,141
  Depreciation & amortization                                                          571                  406
  Other non cash adjustments, net                                                     (380)                   9
  Decrease (increase) in working capital, net                                        1,005                 (938)
                                                                                   -------              -------
   Net cash provided by operating activities                                         2,739                  618
                                                                                   -------              -------
Cash provided by (used for) investing activities
  Additions to property and equipment, net                                            (994)                (487)
  Investment in joint venture, net and other                                            11                   --
  Purchase of aircraft, net                                                          3,968                   --
                                                                                   -------              -------
   Net cash provided by (used for) investing activities                              2,985                 (487)
                                                                                   -------              -------
Cash provided by (used for) Financing Activities
  Change in short term debt                                                          1,759                 (557)
  Change in long term debt and grants                                               (7,374)                (775)
                                                                                   -------              -------
   Net cash used for financing activities                                           (5,615)              (1,332)
                                                                                   -------              -------
Net cash increase (decrease)                                                           109               (1,201)
Cash, begin of period                                                                  188                1,632
                                                                                   -------              -------
Cash, end of period                                                                $   297              $   431
                                                                                   =======              =======


See Notes to financial statements

</TABLE>

                                       5
<PAGE>


                              FEATHERLITE MFG., INC
                    NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

Note 1: Basis of Presentation

         The accompanying condensed financial statements have been prepared,
without audit, in accordance with the instructions of Form 10-Q and therefore do
not include all information and footnotes necessary for a fair presentation of
financial position, results of operations and cash flows in conformity with
generally accepted accounting principles. Financial information as of December
31, 1998 has been derived from the audited financial statements of the Company,
but does not include all disclosures required by generally accepted accounting
principles.

         It is the opinion of management that the unaudited condensed financial
statements include all adjustments, consisting of normal recurring accruals,
necessary to fairly state the results of operations for the three month periods
ended March 31, 1999 and 1998. The results of interim periods are not
necessarily indicative of results to be expected for the year. For further
information refer to the financial statements and notes to financial statements
included in the Company's Form 10-K Annual Report for the year ended December
31, 1998.

Note 2: Property and Equipment

         Property and equipment consists of the following at March 31, 1999 and
December 31, 1998 (in thousands):
 
                                                  1999               1998
                                                  ----               ----
    Land and improvements                       $ 3,718           $  3,042
    Building and improvements                     8,942              8,887
    Machinery and equipment                      12,038             11,763
    Accumulated depreciation                     (8,262)            (7,824)
                                                -------            -------
                  Net Property and equipment    $16,436           $ 15,868 
                                                 ------            -------

Note 3: Goodwill and Other Assets

         Goodwill and other consists of the following at March 31, 1999 and
December 31, 1998 (in thousands):

                                        March 31,                 December 31,
                                          1999                       1998      

    Goodwill, net                      $  9,145                   $   9,126
    Aircraft held for resale              2,901                       6,726
    Idle facilities                         230                         231
    Advertising and other                   523                         363
    Investment in joint venture              (6)                          2  
                                       --------                   ---------
    Total                              $ 12,793                   $  16,398
                                       --------                   ---------

         In March 1999, the Company sold an aircraft and realized a gain of
$200,000 on the sale of an aircraft.

Note 4: Financing Arrangements

         Other notes payable primarily include borrowings under a wholesale
finance agreement with a financial services company for a $23.7 million line of
credit to finance completed new and used motorcoaches held in inventory. The
agreement includes covenants requiring maintenance of defined levels of tangible
net worth, leverage and working capital. It is subject to renewal on October 31,
1999. At March 31, 1999, $18.8 million was borrowed against this line.

                                       6
<PAGE>

         Long-term debt consists of the following at March 31, 1999 and December
31, 1998 (In thousands):
                                                    March 31,      December 31,
                                                     1999             1998
Working Capital line of credit; interest at 
prime less .75*                                     $ 14,823           $ 17,939

Bank notes; interest at prime less .75%,
payable in varying monthly installments
through 2008; same collateral and covenant 
provisions as working capital line of credit *         7,542              7,817

Bank notes; interest at prime plus .75%; 
payable in vary monthly installments
through Januanry,2001; collateralized by aircraft      1,278              5,215

Notes and capitalized leases, interest to 
11.5%, payable in varying monthly
installments to 2003; collateralized by real estate      373              1,184

Bank note, interest at 7.34%; payable in 
monthly installments to 2004;
collateralized by Sanford, Florida real estate.**      1,386                  -
                                                    --------            -------
Total long-term debt                                  25,402             32,155
Less current maturities                               (1,216)            (1,241)
                                                    --------           --------
Long-term debt, net of current maturities             24,186           $ 30,914
                                                    --------           --------
         * Long-term debt includes borrowing under a credit agreement with a
bank that provides a working capital line of credit equal to the lesser of $23
million or a defined percentage of eligible trade receivables and inventory. The
agreement includes covenants requiring maintenance of defined levels of tangible
net worth, earnings before interest, taxes, depreciation and amortization
(EBITDA) and fixed charge coverage ratio.

         ** Long-term debt also includes borrowings to refinance the land
acquisition and construction cost of a sales and service center as discussed in
Note 5 below. The aggregate borrowings on this project will total approximately
$4.0 million and will be repayable in equal monthly installments based on a 15
year amortization with the remaining balance due in November, 2003. The Company
also entered into an interest rate swap for the notional amount of the financing
on this project to fix the effective interest rate on this borrowing at 7.34%
over a five-year term.

Note 5: Commitments and Contingencies.

         Pursuant to dealer inventory floor plan financing arrangements, the
Company may be required, in the event of default by a financed dealer, to
repurchase products from financial institutions or to reimburse the institutions
for unpaid balances including finance charges plus costs and expenses. The
Company was contingently liable under the arrangement for a maximum of $15.7
million at March 31, 1999 and $17.2 million at December 31, 1998.

         Also, the Company is self-insured for a portion of certain health
benefit and workers' compensation insurance claims. The Company's maximum annual
claim exposure under these programs is approximately $4.0 million, including
$1.2 million accrued for estimated unpaid claims at March 31, 1999 and $1.1
million at December 31, 1998. The Company has obtained an irrevocable standby
letter of credit in the amount of $1.2 million in favor of the workers
compensation claim administrator to guaranty settlement of claims.

                                       7

<PAGE>
         There is a risk to future operating results if the Company were to lose
its sole supplier of motorcoach conversion shells, Prevost Car Company, although
the Company could purchase certain shells from other manufacturers. The Company
does have business interruption insurance to cover all or a portion of the
losses it may sustain if Prevost's plant is destroyed by fire or certain other
catastrophes.

         The Company, in the course of its business, has been named as a
defendant in various legal actions. Most, but not all, of such actions are
product liability or workers' compensation claims in which the Company is
covered by insurance subject to applicable deductibles. Although the ultimate
outcome of such claims cannot be ascertained at this time, it is the opinion of
management, after consulting with counsel, that the resolution of such suits
will not have a material adverse effect on the financial position of the
Company, but may be material to the Company's operating results for any
particular period.

         In November 1998 the Company entered into a contract in the aggregate
amount of $2.9 million for the development and construction of a sales facility
on land near the Company's Sanford location. In 1999, this project was expanded
to include a service center at an additional approximate cost of $800,000. This
project will be substantially completed by the end of the second quarter of
1999. It is being financed with borrowed funds from First Union Bank.

Note 6: Shareholders' Equity

         Shareholders' equity may be further detailed as follows (in thousands):

                                                      March 31,       Dec 31,
                                                         1999          1998
                                                       --------      --------
Common stock - without par value;
   Authorized- 40,000,000 shares;
   issued-      6,500,051 shares                     $ 16,385        $ 16,236
Additional paid-in capital                              4,062           4,062
Retained earnings                                      10,788           9,245
                                                     --------        --------
         Total Shareholders' equity                  $ 31,235        $ 29,543
                                                     ========        ========
         In 1994, the Company completed an initial public offering of 1,955,000
shares of Company common stock and granted an option to the Underwriter to
purchase 120,000 shares at a price of 120% of the initial public offering price
of $6.00 per share. This option, which expires in September 1999, has not yet
been exercised.

         In 1999, the Company issued 25,000 additional shares of common stock to
the former owner of Vantare International, Inc. These additional shares were
earned under the terms of the purchase agreement for this 1996 asset acquisition
for the achievement of defined earnings levels through December 31, 1998. An
additional 75,000 shares may still be earned under this agreement for the
performance of the Vantare Division through December 31, 2000. Goodwill related
to this acquisition was increased by $150,000 for this stock issue.

Note 7: Stock Option Plan

         In accordance with the stock option plan established by the Company in
July 1994, as amended in May, 1998, the Board of Directors has granted options
to purchase Company common stock to certain employees and directors in the total
amount of 544,380 shares at March 31, 1999 and 529,380 at December 31,1998.
These options were granted at a prices ranging from $5.50-$10.00 per share, and
are exercisable at varying dates not to exceed 10 years from the date of grant.
Options totaling 15,000 shares have been granted in 1999. No options have been
exercised in 1999.

Note 8: Earnings per Share

         The weighted-average number of shares of common stock used to compute
the basic earnings per share was increased by 5,518 at March 31,1999 and 85,322
at March 31,1998 for the assumed exercise of options and warrants in computing

                                       8
<PAGE>

the diluted earnings per share data. Basic and diluted earnings per share, as
calculated under FAS statement No. 128, are not materially different than the
primary and fully diluted earnings per share as previously reported in prior
periods.

Note 9: Segment Reporting

         The Company has two principal business segments, trailers and
motorcoaches. The accounting policies applied to determine segment information
are the same as described in the summary of significant accounting policies in
the Company's annual report for the year ended December 31, 1998, except that in
1999, the Company allocated $321,000 of selling, general and administrative
expenses from general corporate to the motorcoach division. Management evaluates
the performance of each segment based on profit or loss from operations before
income taxes, excluding non-recurring gains or losses.

         The Company's sales are not materially dependent on a single customer
or small group of customers.

         Information on business segments and geographic information is as
follows as of March 31, 1999 and 1998 and for the three month periods then ended
(in 000's):

                                             1999                     1998
                                             -----                   -----
Net Sales to unaffiliated customers
  Trailers                                $ 30,510                 $ 28,581
  Motorcoaches                              28,912                   13,161
                                          --------                 --------
  Total net sales                           59,422                   41,742
                                          --------                 --------
Income (loss) from operations
  Trailers                                   3,259                    2,420
  Motorcoach                                 1,017                    1,315
  General corporate                         (1,214)                  (1,479)
  Other income (expense)                      (469)                    (355)
                                          --------                 --------
  Income before income taxes              $  2,593                 $  1,901
                                          --------                 --------
Interest expense
  Trailers                                $    169                 $    241
  Motorcoaches                                 612                      237
  General corporate                            116                       98
                                          --------                 --------
  Total interest expense                  $    897                 $    576
                                          --------                 --------
Provision for income taxes
  Trailers                                $  1,251                 $    872
  Motorcoaches                                 205                      452
  General corporate                           (406)                    (564)
                                          --------                 --------
  Total provision for income taxes        $  1,050                 $    760
                                          --------                 --------
Identifiable assets
  Trailers                                $ 41,873                 $ 39,199
  Motorcoaches                              58,964                   23,904
  General corporate                          6,544                   12,360
                                          --------                 --------
  Total assets as reported                $107,381                 $ 75,463
                                          --------                 --------
Capital expenditures
  Trailers                                $     51                 $    166
  Motorcoaches                                 817                       73
  General corporate                            126                      248
                                          --------                 --------
  Total capital expenditures              $    994                 $    487
                                          --------                 --------

                                       9
<PAGE>



                                               1999                     1998
                                              -----                    -----
Depreciation and amortization
  Trailers                                   $   241              $       209
  Motorcoaches                                   200                       80

  General corporate                              130                      117
                                             -------              -----------
  Total depreciation and amortization        $   571              $       406
                                             -------              -----------

Geographic Information
Revenues                                    
  United States                              $58,313              $    40,312
  Canada and other regions                     1,109                    1,430
                                             -------              -----------
  Consolidated revenues                      $59,422              $    41,472
                                             -------              -----------

Long-lived assets
  United States                              $29,229              $    25,282
  Canada and other regions                         -                     ---
                                             -------              -----------
  Consolidated long-lived assets             $29,229              $    25,282
                                             --------             -----------



                                       10

<PAGE>
Item 2:

Management's Discussion and Analysis of Financial Condition 
and Results of Operations

         The following discussion pertains to the Company's results of
operations and financial condition for the three-month periods ended March 31,
1999 and 1998.

Results of Operations

         Three months ended March 31, 1999 and 1998

         Net sales of $59.4 million for the quarter ended March 31, 1999
increased by 42.4% from net sales of $41.7 in last year's first quarter. This
increase of $17.7 million over 1998 included $11.4 million from the Featherlite
Vogue line of motorcoaches acquired in May 1998. The balance of the sales
increase over the first quarter of 1998, $6.3 million, resulted from growth in
established product categories, including a $4.1 million or 30% increase in
sales of Featherlite Vantare luxury motorcoaches. Sales of Featherlite aluminum
and steel brand trailers and other products increased by $2.2 million or 6.8%.

         Gross profit increased to $9.7 million in the first quarter of 1999
from $6.9 million in 1998 as a result of the increased levels of sales. As a
percentage of sales, gross margin for the quarter decreased to 16.3% in 1999
from 16.7% in 1998. The gross profit percentage decrease primarily reflects the
change in sales mix between trailers and motorcoaches as well as changes in the
gross margin percentage of each business segment. Trailer segment gross profit
percentage improved by 2.9 percentage points during the quarter compared to 1998
due to reduced aluminum costs and a higher percentage of transporter sales in
1999. Motorcoach segment gross profit percentage declined 3.8 percentage points
compared to last year as a result of a greater percentage of used coach sales in
1999 than 1998.

         Selling and administrative expenses increased in 1999 by $2.0 million
over 1998 but remained unchanged at 11.2% as a percentage of sales. The increase
in the total cost of this category primarily reflects additional advertising,
personnel and other costs related to Company growth, including $1.3 million
related to the Vogue division that was acquired in May 1998.

         Interest expense increased in 1999 compared to 1998 due to higher
levels of debt. The provision for income taxes reflects an effective federal and
state income tax rate of about 40% in 1999 and 1998. Other income increased by
$207,000 primarily as the result of an aircraft sale in 1999, which realized a
gain of $200,000.

Segment Information

         The following discussion pertains to information on the Company's two
principal business segments as set forth in Note 9 to the financial statements
for the quarters ended March 31, 1999 and 1998.

         Trailer segment
                                                  1999            1998
                                               -------         -------
         Net sales (000's)                     $30,510         $28,581
         Segment income (000's)                  3,259           2,420
         Segment income percent                   10.7%            8.5%

         Trailer segment sales increased by 6.8% in the first quarter of 1999
over 1998. On a product line basis, horse trailer sales remained unchanged,
livestock trailer sales decreased by 30%, car/racecar and specialty transporter
sales were up 40%, utility trailer sales decreased by 22% and commercial
                                       11
<PAGE>

trailers sales were up by 15%. Sales of specialized car haulers and race car
tranporters set a sales record for the quarter. Motorsports continues to be a
booming entertainment category with a record number of competitors, many of whom
use Featherlite products. The decrease in livestock trailer sales is a result of
the economic difficulties in the farm and agricultural economy that began in
1998, particularly in the Midwest.

         Trailer segment income increased in 1999 as the result of a greater
sales volume as well as an increased gross margin percentage. The gross margin
percentage increased by 2.9% as the result of lower material costs due to a
lower average cost per pound of aluminum used as well as a higher percentage of
transporter sales which have a lower material cost as a percentage of the
selling price. This improvement was partially offset by increased marketing and
delivery costs, which increased as a percentage of sales to 8.7% in 1999 from
8.0% in 1998.

         Motorcoach Segment
                                                1999                 1998
                                              --------            ---------
         Net Sales (000's)                     $28,912              $13,161
         Segment income (000's)                  1,017                1,315
         Segment income percent                    3.5%                10.0%

         Motorcoach segment sales increased by $15.7 million, or 120%, in the
first quarter compared the same quarter last year, including $11.4 million,
which was contributed by the addition of the Featherlite Vogue line of
motorcoaches acquired in May 1998. Excluding Featherlite Vogue, the sales of
Featherlite Vantare increased by about 30%.

         Motorcoach segment income percentage decreased in 1999 by 6.5
percentage points compared to 1998 due to a decrease of 3.9 percentage points in
the segment gross margin percentage and an increase of 2.6 percentage points in
segment operating expenses. The decline in gross margin percentage is primarily
due to an increased level of used motorcoach sales in 1999 compared to 1998.
Segment operating expenses increased by approximately $1.3 million in 1999 due
to the Featherlite Vogue acquisition in May 1998 and an allocation of $321,000
of corporate marketing and administrative expenses in 1999, which decreased
segment income as a percent of sales by 1.1 percentage points in 1999.

Looking Forward

         The statements made in this Form 10Q quarterly report which are forward
looking in time involve risks and uncertainties discussed here and in the
Company's Form 10K and other filings with the SEC, including but not limited to:
product demand and acceptance of new products in each segment of the Company's
markets, fluctuations in the price of aluminum, competition, facilities
utilization and aircraft purchases and sales.

         We expect consolidated sales to be strong in 1999 due primarily to
continued growth in the motorcoach segment. Trailer segment growth may be
reduced compared to recent years due to continued economic difficulties in
agribusiness. The Company believes its name recognition and close affiliation
with the motorsports industry will continue to have a positive impact on its
sales of specialty trailers and luxury motorcoaches as well as other trailers
used for leisure and entertainment purposes. With more than 75% of its revenue
from end users in motorsports and leisure and entertainment categories, which
also includes horse trailers, and with its strong position in the livestock
trailer market, the Company believes it is strategically well-situated to
respond to competitive pressures and to benefit from growth in these markets.
The total sales backlog at March 31, 1999 was $34 million compared with $31
million at December 31, 1998 and $27 million at March 31, 1998. The backlog
includes motorcoach order backlog of $23 million, $19 million and $15 million at
March 31, 1999, December 31, 1998 and March 31, 1998, respectively.

         The Company has obtained commitments from suppliers to provide, at an
agreed upon fixed price, substantially all of its anticipated aluminum
requirements for 1999 at an average cost which is about 5% lower than 1998
levels. It has also obtained commitments for a substantial portion of its

                                       12
<PAGE>

anticipated requirements for 2000 at an average cost which is about 8% lower
than 1999. This should have a positive impact on trailer segment income.
Motorcoach segment margins should continue to improve but can be adversely
affected by the impact of used motorcoach sales which normally have a margin
percentage which is substantially below the margin percentage on new coach
sales. On an overall basis, gross margins should remain at about the same level
as last year's year-end margin percentage but could trend slightly lower as the
motorcoach segment becomes a larger percentage of the consolidated totals.

         Sales and administrative expenses for 1999 are expected to increase but
at a lower rate than sales growth as much of the organizational growth occurred
in prior years. Interest expense will likely remain higher in 1999 than 1998 as
the average level of debt is expected to be greater due to working capital
growth as well as facilities expansion as discussed further below.

         There is a risk to future operating results related to losing a major
supplier of aluminum. This risk is relatively nominal, as there are alternate
sources of supply. There is also a risk to future operating results if the
Company were to lose its sole supplier of motorcoach shells, Prevost Car
Company, although the Company could purchase certain shells from other
manufacturers. The Company does have business interruption insurance to cover
all or a portion of the losses it may sustain if Prevost's plant is destroyed by
fire or certain other catastrophes. There is also a risk related to the timely
delivery of certain custom trailers and specialty transporters in the event the
Company's sole supplier is interrupted from providing these services due to
unforeseen circumstances or customer delays in providing specifications to the
subcontractor.

         The Company has made increased use of leverage and incurred interest
and related expenses in the three years ended December 31, 1998 and quarter
ended March 31, 1999. Increased debt has been incurred in connection with
financing the operations of the Vantare and Vogue Divisions and in financing
additional working capital requirements. In 1999, additional debt will be
incurred to finance construction of a sales and service center at the Company's
Sanford, Florida location. Increased leverage and related expenses create risk
to future operating results of the Company.

         The Company continues to make progress in readying its hardware and
software systems information technology (IT) and non-IT systems for the year
2000. It is estimated that these activities will be completed by June 30, 1999
at a cost ranging from $75,000-100,000 which will not have a material impact on
the Company's business, financial condition or results of operation. The Company
is continuing to contact vendors who provide it production materials and
supplies to determine the status of their Year 2000 assessment and readiness
programs. We are substantially completed with this survey and are not aware of
any significant problems that would adversely impact the Company. We are unaware
of any material risk to the Company associated with Year 2000 issues at this
time. We are developing contingency plans to address potential hardware and
software systems failures that may arise. We believe the most reasonably likely
worst case year 2000 scenario would be a decrease in the efficiency with which
the Company is able to procure materials and supplies from vendors and produce
its products. This could have an adverse effect on the Company's results of
operations and financial condition if prolonged.

Liquidity and Capital Resources

         During the first quarter of 1999, the Company's operations provided net
cash of $109,000, including $2.7 million provided from operating activities and
$3.0 million from investing activities, net of $5.6 million used for debt
reductions.

         Operating activities in the first quarter of 1999 provided net cash of
$2.7 million. Net income from operations provided cash of $1.5 million. This
amount was increased by adjustments for depreciation and amortization of
$571,000 and decreased by other non-cash items in an aggregate amount of
$380,000. Net changes in receivables, inventories and other working capital

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<PAGE>

items provided cash of $1.0 million. Inventories increased by $1.0 million
primarily to support the increased level of sales in the motorcoach segment.
Increased expenditures for working capital items may be required to support
increased sales levels throughout 1999. Additional increases in working capital
may be required in future quarters to support higher levels of sales. Cash
generated from operations as well as the Company's available lines of credit
will fund these increases.

         Investing activities for the current quarter provided net cash of $3.0
million, including $4.0 million provided from the sale of aircraft and $1.0 used
for plant and other improvements, including $620,000 related to the sales and
service expansion at the Company's location in Sanford, Florida as discussed
further below. The Company anticipates replacing the aircraft at a comparable
amount before the end of 1999.

         Financing activities used net cash of $5.6 million including a
reduction of aircraft debt of $3.9 million and other net reductions of $1.7
million primarily related to changes in the wholesale floor plan and revolving
line of credit. The Company borrowed $620,000 related to the Sanford expansion
during the quarter.

         The Company has a working capital line of credit with its primary
lender, Firstar Bank. This line has a borrowing limit of $23.0 million based on
levels of eligible receivables and inventory and an interest rate of prime less
 .75% (7.00% at March 31, 1999). The maturity date of borrowings under this line
is September 24, 2002, subject to renewal and extension. The agreement contains
covenants that limit annual capital expenditures, total liabilities in relation
to defined tangible net worth and total fixed charges in relation to defined
EBITDA. Borrowings under the line are secured by substantially all assets of the
Company. There was $14.8 million borrowed against this line as of March 31,
1999. The Company also has available through Firstar various term notes totaling
$3 million as future borrowings for real estate projects and equipment. There
were no borrowings on these notes at March 31, 1999.

         The Company also has a wholesale floor plan agreement with Deutsche
Financial Services to borrow up to $23 million for financing new and used
motorcoaches held in inventory, with interest at prime (7.75% at March 31, 1999)
on borrowed funds. This agreement includes covenants requiring maintenance of
defined levels of tangible net worth, leverage and working capital. At March 31,
1999, $18.8 million was borrowed on this line.

         In November 1998, the Company entered into a construction contract in
the amount of $2.9 million for the development and construction of a sales
facility near the Company's Sanford, Florida location. This project was
subsequently expanded by about $800,000 to include a service center. It is
expected these facilities will be completed in about mid-1999. The construction
and long-term mortgage financing for this project are being provided by First
Union Bank. At March 31, 1999, $620,000 was borrowed on this note. The interest
rate on this facility is based on one-month LIBOR rate plus 1.8% (6.76% at March
31, 1999). The Company has reduced the long-term risk related to unfavorable
fluctuations in this floating interest rate by entering into an interest rate
swap with First Union in notional amount of the financing provided, which fixed
the effective rate on this loan at 7.34% over a five year term. Interest only is
payable on this facility during the construction period; thereafter it will be
repayable in equal monthly installments of principal and interest based on a 15
year amortization, with the remaining balance due November, 2003.

         The Company believes that its current cash balances, cash flow
generated from operations and available borrowing capacity will be sufficient to
fund operations and capital requirements for the next year and the foreseeable
future.

         As discussed in Note 2 to financial statements, the Company is
contingently liable under certain dealer floor plan and retail financing
arrangements. These contingent liabilities total approximately $15.7 million at
March 31, 1999. Also, the Company is self-insured for a portion of certain
health benefit and workers' compensation insurance claims. At March 31, 1999,

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<PAGE>

the Company's maximum annual claim exposure under these programs is
approximately $4 million, including $1.2 million accrued for unpaid claims. The
Company has obtained an irrevocable standby letter of credit in the amount of
$1.2 million in favor of the workers compensation claim administrator to
guarantee payment of claims.

         The Company has also made a commitment to the City of Cresco to
construct a hangar facility at a cost of $300,000 as part of an airport
expansion project to be completed in 1999 or 2000. These programs would be
financed with new borrowings from banks or other financial institutions.

         In October 1997, the Company signed a joint venture agreement with GMR
Marketing to form Featherlite/GMR Sports Group, LLC. The joint venture is
focusing on developing promotional events and implementing marketing strategies
in the rapidly growing motorsports industry. It is not expected that this
venture will require significant capital from the Company to maintain its
operations.

         The Company leases certain office and production facilities under
various leases that expire at varying dates through fiscal year 2011. Minimum
lease payments for 1999 are expected to total $828,000.

Item 3:

Quantitative and Qualitative Disclosures about Market Risk

         Featherlite is exposed to market risks related to changes in U.S. and
International interest rates. Substantially all of the Company's debt bears
interest at a variable rate. To a limited extent, the Company manages its
interest rate risk through the use of interest rate swaps. As of December 31,
1998 and March 31, 1999, the fair value of interest rate swaps was not material.
A 10% increase in interest rates would reduce the Company's future annual
earnings by approximately $385,000 at current levels.

         The Company uses substantial quantities of aluminum in its
manufacturing of trailers. The Company generally seeks to limit its exposure to
the risk of fluctuations in the price of aluminum by entering into fixed-price
contracts with suppliers for quantities sufficient to satisfy its requirements
for up to one year in advance. The Company does not engage in hedging
transactions or other use of derivatives in connection with its operations.




                                       15

<PAGE>


                           PART II. OTHER INFORMATION


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

         (a) Exhibits
             See Exhibit Index on page following signatures.

         (b) Form 8-K. The Registrant did not file any reports on Form 8-K
during the three months ended March 31, 1999.





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<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.


                                           FEATHERLITE, INC.
                                           (Registrant)



Date:  May 12, 1998                        /S/ CONRAD D. CLEMENT
                                           ---------------------
                                           Conrad D. Clement
                                           President & CEO




Date:  May 12, 1998                        /S/ JEFFERY A. MASON
                                           --------------------
                                           Jeffery A. Mason
                                           Chief Financial Officer








                                       17
<PAGE>



                                  EXHIBIT INDEX


Exhibit
Number                   Description
------                   -----------
10.1*     Agreement with Western Extrusions for aluminum purchases
          for the year 2000.

10.2*     Agreement with Edgcomb Metals for aluminum purchases for
          the year 2000.

10.3*     Agreement with Reynolds Aluminum Supply Company for aluminum
          purchases for the year 2000.

10.4*     Agreement with Vincent Metal Goods for aluminum purchases
          for the year 2000.

10.5*     Agreement with Aluminum Shapes for aluminum purchases for the
          year 2000.

10.6*     Agreement with Reyonlds Aluminum Supply Company for
          aluminum purchases from November 1, 1999 through December
          31, 2000.

27        Financial Data Schedule (filed in electronic format only)



*    Portions of these documents have been omitted pursuant to a request for 
     confidential treatment




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