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

                               FORM 10-K

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

              For the Fiscal Year Ended December 31, 1998

                   Commission File Number  1-12149

                 CONSOLIDATED FREIGHTWAYS CORPORATION


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

               175 Linfield Drive, Menlo Park, CA  94025
                    Telephone Number (650) 326-1700

      Securities Registered Pursuant to Section 12(b) of the Act:

                                              Name of Each
                                               Exchange on
        Title of Each Class                  Which Registered

        Common Stock ($.01 par value)             NASDAQ


Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Sections 13 or 15(d) of the Securities Exchange
Act  of 1934 during the preceding 12 months (or for such shorter period
that  the  registrant was required to file such reports), and  (2)  has
been subject to such filing requirements for the past 90 days.
Yes___X___     No_______

Indicate  by check mark if disclosure of delinquent filers pursuant  to
Item  405  of Regulation S-K is not contained herein, and will  not  be
contained,  to the best of registrant's knowledge, in definitive  proxy
or information statements incorporated by reference in Part III of this
Form 10-K or any amendment to this Form 10-K. _______

Aggregate  market  value of voting stock held  by  persons  other  than
Directors, Officers and those shareholders holding more than 5% of  the
outstanding voting stock, based upon the closing price per share on the
National  Automated  System of the National Association  of  Securities
Dealers   Inc.  Automated  Quotation  System  on  February  26,   1999:
$249,871,555

             Number of shares of Common Stock outstanding
                     as of February 26, 1999: 22,623,748

                  DOCUMENTS INCORPORATED BY REFERENCE

                          Parts I, II and IV


Consolidated Freightways Corporation 1998 Annual Report to Shareholders
(only  those portions referenced herein are incorporated in  this  Form
10-K).

                              Part III

Part  III is incorporated by reference from the proxy statement  to  be
filed  in  connection  with  the  Company's  1999  Annual  Meeting   of
Shareholders.  (Only those portions referenced herein are  incorporated
in this Form 10-K).


                                Page 1




                 CONSOLIDATED FREIGHTWAYS CORPORATION
                               FORM 10-K
                     Year Ended December 31, 1998

_______________________________________________________________________


                                 INDEX

   Item                                                         Page

                                PART I

     1.     Business                                              3
     2.     Properties                                            9
     3.     Legal Proceedings                                    10
     4.     Submission of Matters to a Vote of Security Holders  10

                                PART II

     5.     Market for the Registrant's Common Stock and
              Related Stockholder Matters                        10
     6.     Selected Financial Data                              10
     7.     Management's Discussion and Analysis of Financial
             Condition and Results of Operations                 10
     7A.    Quantitative and Qualitative Disclosures About
             Market Risk                                         11
     8.     Financial Statements and Supplementary Data          11
     9.     Changes in and Disagreements with Accountants on
             Accounting and Financial Disclosure                 12

                               PART III

     10.    Directors and Executive Officers of the Registrant   13
     11.    Executive Compensation                               13
     12.    Security Ownership of Certain Beneficial
             Owners and Management                               14
     13.    Certain Relationships and Related Transactions       14

                                PART IV

     14.    Exhibits, Financial Statement Schedules and Reports
             on Form 8-K                                         14

     SIGNATURES                                                  15

     INDEX TO FINANCIAL INFORMATION                              17



                                Page 2



                 CONSOLIDATED FREIGHTWAYS CORPORATION
                               FORM 10-K
                     Year Ended December 31, 1998
_______________________________________________________________________


                                PART I

ITEM 1.   BUSINESS

(a) General Development of Business

Consolidated  Freightways  Corporation is a holding  company  that  was
incorporated  in  Delaware in 1996. It is herein  referred  to  as  the
"Registrant"  or "Company". Formerly a subsidiary of CNF Transportation
Inc. (the former parent) through December 1, 1996, the Company was spun-
off  in  a tax-free distribution (the Distribution) to shareholders  of
the  former  parent.  The Company consists of Consolidated  Freightways
Corporation   of   Delaware   (CFCD),  a  nationwide   motor   carrier,
incorporated  in  1958  as successor to the original  trucking  company
organized  in  1929,  and its Canadian operations,  including  Canadian
Freightways, Ltd., Epic Express, Milne & Craighead, Canadian Sufferance
Warehouses,  Blackfoot Logistics and other related businesses;  Redwood
Systems,  a  supply chain management services provider; and the  Leland
James  Service  Corporation, an administrative  service  provider.  The
Company primarily provides less-than-truckload (LTL) transportation and
supply  chain management services throughout the United States,  Canada
and  Mexico,  and  international freight services  between  the  United
States and more than 80 countries.


(b) Financial Information About Industry Segments

Segment  information is summarized in Note 10 on page 27  of  the  1998
Annual Report to Shareholders and is incorporated herein by reference.


(c) Narrative Description of Business

The  Company, headquartered in Menlo Park, California, is  the  holding
company  of  CFCD, a full-service trucking company providing less-than-
truckload freight services nationwide and in Canada and Mexico, and one-
stop  international freight service between the United  States  and  80
countries  worldwide through operating agreements with  ocean  carriers
and  a  network of international partners.   Operations consist  of  an
extensive  transportation  network that typically  moves  shipments  of
manufactured  or  non-perishable processed products  having  relatively
high value and requiring consistent, expedited service, compared to the
bulk   raw   materials  characteristically  transported  by  railroads,
pipelines and water carriers. Less-than-truckload (LTL) is an  industry
designation  for shipments weighing less than 10,000 pounds.   CFCD  is
one  of  the  nation's  largest LTL motor carriers  in  terms  of  1998
revenues.   The Company also provides supply chain management  services
through  its wholly-owned subsidiary, Redwood Systems, Inc.  (Redwood).
Established in January 1997, Redwood is a third party, non-asset  based
logistics company that offers complete supply chain management services
including  dedicated  contract warehousing and  carriage,  just-in-time
delivery  and specialized time-definite distribution, information-based
logistics services and worldwide multi-modal logistics.


                                Page 3


CFCD's  primary  competitors  in the national  LTL  market  are  Yellow
Freight   System,  Inc.,  Roadway  Express,  Inc.  and  Arkansas   Best
Corporation.   CFCD  also competes for LTL freight  with  regional  LTL
motor  carriers, small package carriers, private carriage  and  freight
forwarders.   Competition for freight is based  primarily  upon  price,
service  consistency and transit time. In an effort to  provide  faster
service  and  to  better  compete,  CFCD  implemented  a  comprehensive
reengineering  of  its  line-haul operations  in  October  1995.   This
reengineering,  called the Business Accelerator System (BAS),  replaced
CFCD's  traditional hub-and-spoke network with one that  moves  freight
directionally from point-to-point and streamlines the freight  network.
BAS  has  the  effect of reducing miles and freight  handling,  thereby
reducing  transit  times  and costs as well as more  efficiently  using
system  capacity. This reengineering, in conjunction with  value  added
service  offerings  and  use of lower-cost rail  services  allowed  the
Company to return to profitability.  However, the Company is faced with
a  steady erosion of its market share in its traditional "greater  than
1,500   miles"  length-of-haul  due  to  market  trends  such  as   the
"regionalization"  of freight due to just-in-time inventory  practices,
distributed warehousing and other changes in business processes.   Also
contributing  to  this  decline are new longer  length-of-haul  service
offerings by regional and parcel carriers.  To remain competitive,  the
Company is investing in its infrastructure to facilitate operations  in
the  500 to 1,500 mile length-of-haul market.  The Company successfully
launched  second day service in certain eastern bound markets in  early
1998,  reducing transit times by 1 to 2 days, and plans to expand  this
service offering in 1999.  To grow, the Company must continue to invest
in  its infrastructure to become more competitive in shorter length  of
haul  lanes  and  develop services tailored to customer  needs.   Those
services  include  CF PrimeTime Air, the Company's   premium  expedited
service  offering.  The Company made refinements to its  expedited  air
and  ground  network  in  1998  to establish  guaranteed  time-definite
service  throughout North America, from Canada to Mexico. This  service
offering helps to differentiate the Company in the LTL market and is an
important  source of growth opportunities in 1999.  Also  during  1998,
the Company expanded its international services through a joint venture
in  Mexico  and now provides direct service to more than  50  locations
within  Mexico.   Customer shipments are handled by the  Company,  from
origin  to  destination, with no hand-offs to third parties.   Combined
with  the  Company's PrimeTime  service, the Company is  the  only  LTL
carrier to offer premium expedited freight delivery services in and out
of Mexico. These service offerings make the Company a single-source LTL
provider throughout North America.

As  a  large carrier of LTL general freight, at December 31, 1998, CFCD
operated   approximately  39,440  vehicle  units  including  inter-city
tractors and trailers and pick-up and delivery units.  It had a network
of  360 U.S. and Canadian freight terminals, metro centers and regional
consolidation centers.

There  is a broad diversity in the customers served, size of shipments,
commodities  transported  and  length of  haul.   No  single  commodity
accounted for more than a small fraction of total revenues.

CFCD  operates  daily  schedules  utilizing  relay  drivers  who  drive
approximately  eight to ten hours each day and sleeper teams  which  in
1998  approximated  20% of all linehaul miles in  North  America.  Road
equipment  consists of one tractor pulling two 28-foot double  trailers
or,  to  a  limited extent, one semi-trailer or three 28-foot trailers.
CFCD  generally utilizes trailer equipment that is 102 inches in width.
CFCD continued to maximize use of lower-cost rail services in 1998,  as
rail  miles as a percentage of total linehaul miles were 28%. In  1998,
CFCD operated in excess of 617 million linehaul miles.

                                Page 4



CFCD  and  several Canadian subsidiaries serve Canada through terminals
in the provinces of Alberta, British Columbia, Manitoba, New Brunswick,
Nova  Scotia, Ontario, Quebec, Saskatchewan and in the Yukon Territory.
The  Canadian operations utilize a fleet of over 1,380 trucks, tractors
and trailers.


Cyclicality and Seasonality

The  LTL  trucking industry is affected directly by the  state  of  the
overall  economy and seasonal fluctuations, which affect the amount  of
freight  to  be  transported. Freight shipments,  operating  costs  and
earnings  are also affected adversely by inclement weather  conditions.
The months of September, October and November of each year usually have
the highest business levels while the first quarter has the lowest.


Employees

At  December  31,  1998,  approximately 82% of the  Company's  domestic
employees  were  represented  by various labor  unions,  primarily  the
International  Brotherhood of Teamsters. On April 13,  1998,  the
International  Brotherhood  of  Teamsters  ratified  a  new   five-year
National  Master Freight Agreement with CFCD and three  other  national
motor freight carriers.

Labor  costs, including fringe benefits, averaged approximately 65%  of
the  Company's  1998  revenues. The Company had  approximately  21,000,
21,600  and  20,300  employees at December 31,  1998,  1997  and  1996,
respectively.


Fuel

During  1996,  the Company experienced a significant increase  in  fuel
prices,  with  the  average annual fuel cost per gallon  (without  tax)
increasing  to  $0.697. To partially offset this increase,  the Company
instituted  a fuel surcharge program in the second half of  1996.  This
program continued throughout 1997, as the average annual fuel cost  per
gallon was $0.659.  As fuel prices moderated towards the latter half of
1997 and into 1998, the Company eliminated its fuel surcharge effective
February 3, 1998.  The average annual fuel cost per gallon continued to
decline in 1998 to $0.462.

Significant  increases  in fuel prices, to the  extent  not  offset  by
increases in transportation rates, would have a material adverse effect
on  the  profitability of the Company.  Historically, the  Company  has
responded to periods of sharply higher fuel prices by implementing fuel
surcharge  programs  or  base  rate  increases,  or  both,  to  recover
additional costs.  However, there can be no assurance that the  Company
will be able to successfully implement such surcharges or increases  in
response to increased fuel costs in the future.


                                Page 5


Year 2000

CFCD's  operations  are  supported by a sophisticated  data  processing
system for the control and management of the business.  Management  has
a  formal plan in place through which it has identified its operational
and financial systems and applications requiring either modification or
replacement  for Year 2000 compliance. Of these systems, the  Company's
on-line  equipment and freight tracking system is deemed most critical.
Based upon an assessment at December 31, 1998, testing and modification
of  IT  systems is approximately 55% complete while testing  of  non-IT
embedded  systems is approximately 35% complete. 1998 expenses  related
to  Year 2000 modifications total $4.2 million and include payroll  and
payroll related costs as well as the costs of external consultants.  In
certain  cases,  management  has opted to replace  rather  than  modify
certain  of  its systems and applications.  Costs associated  with  the
replacement  of  systems  and  applications  are  capitalized.   As  of
December  31,  1998,  $15.0 million has been capitalized  and  includes
hardware,  software  and payroll costs as well  as  costs  of  external
consultants.  Management expects to spend an additional $22 million  to
convert its internal systems for Year 2000 compliance.  Of this amount,
it  is  expected  that approximately $5 million will  be  expensed  and
approximately $17 million will be capitalized.  These estimates may  be
revised  based  upon  the  results of  continued  testing.   Management
expects  that all Year 2000 system modifications and replacements  will
be funded with cash from operations.

Management  has engaged outside consultants as part of the  process  of
assessing its Year 2000 risks.  Part of that assessment includes  third
party  compliance readiness. Management has identified and  prioritized
its  critical customers and key suppliers of products and services  and
is  currently  soliciting  written responses  to  Year  2000  readiness
questionnaires.   Management  will  formulate  contingency   plans   as
necessary based upon the results of those questionnaires.

Management  anticipates having all of its internal  systems  Year  2000
compliant  by mid-1999.  However, failure to convert the Company's  on-
line  equipment  and  freight tracking system by the  Year  2000  could
result  in  the inability to manage the flow of equipment  and  freight
through the system efficiently, but would not preclude the delivery  of
freight. Additionally, failure to convert financial systems on a timely
basis could result in a return to manual processes resulting in delayed
customer billings and vendor payments.  To the extent that the  Company
or  its critical customers and key suppliers fail to achieve Year  2000
compliance,  there could be a material adverse effect on the  Company's
business, results of operations and financial position.


Federal and State Regulation

Regulation of motor carriers has changed substantially in the  last  20
years.   The process started with the Motor Carrier Act of 1980,  which
allowed  easier  access  to  the industry by  new  trucking  companies,
removed   many  restrictions  on  expansion  of  services  by  existing
carriers,  and  increased price competition by narrowing the  antitrust
immunities   available   to   the  industry's   collective   ratemaking
organizations.  This  deregulatory trend was  continued  by  subsequent
legislation in 1982, 1986, 1993 and 1994.  The process culminated  with
federal  pre-emption of most economic regulation of intrastate trucking
regulatory bodies effective January 1, 1995, and with legislation which
terminated  the Interstate Commerce Commission (ICC) effective  January
1, 1996.

                                Page 6


Currently,  the motor carrier industry is subject to federal regulation
by   the   Federal  Highway  Administration  (FHWA)  and  the   Surface
Transportation  Board  (STB), both of which are  units  of  the  United
States  Department of Transportation (DOT). The FHWA  performs  certain
functions  inherited  from the ICC relating chiefly  to  motor  carrier
registration,  cargo and liability insurance, extension  of  credit  to
motor  carrier  customers, and leasing of equipment by  motor  carriers
from  owner-operators.  In  addition, the FHWA  enforces  comprehensive
trucking safety regulations relating to driver qualifications, drivers'
hours   of  service,  safety-related  equipment  requirements,  vehicle
inspection   and   maintenance,   recordkeeping   on   accidents,   and
transportation  of hazardous materials.  Because CFCD makes  large  and
increasing  use  of  rail "piggyback" (trailer-on-flatcar)  service  as
permitted under its current collective bargaining agreements, CFCD must
also comply with the hazardous materials transportation regulations  of
DOT's   Federal  Railroad  Administration.   Compliance  with   similar
regulations  of DOT's Federal Aviation Administration is required  when
CFCD tenders shipments to air carriers in the PrimeTime Air program. As
pertinent  to  the  general  freight trucking  industry,  the  STB  has
authority  to  resolve certain types of pricing disputes and  authorize
certain  types of intercarrier agreements under jurisdiction  inherited
from the ICC.

At  the state level, federal pre-emption of economic regulation does not
prevent  the  states  from  regulating motor vehicle  safety  on  their
highways.   In  addition,  federal law  allows  all  states  to  impose
insurance  requirements  on motor carriers conducting  business  within
their  borders,  and  empowers most states to  require  motor  carriers
conducting interstate operations through their territory to make annual
filings  verifying that they hold appropriate registrations from  FHWA.
Motor  carriers also must pay state fuel taxes and vehicle registration
fees,  which normally are apportioned on the basis of mileage  operated
in each state.


Canadian Regulation

Although the provinces in Canada have regulatory authority over  intra-
provincial   operations  of  motor  carriers,  they  have  elected   to
substantially  eliminate  intra-provincial regulation  of  the  general
freight trucking industry. Federal legislation to phase in deregulation
of  the extra-provincial motor carrier industry took effect January  1,
1988  and  the  phase  in was completed in 1997.  The  new  legislation
relaxed  economic  regulation of extra-provincial  trucking  by  easing
market  entry  restrictions.  The Canadian provinces  have  implemented
safety  regulations  of  trucking services applicable  to  both  extra-
provincial and intra-provincial operations of motor carriers.  CFCD and
its  Canadian affiliates wrote off substantially all of the unamortized
cost of their Canadian operating authorities in 1992.


General

The  research  and  development  activities  of  the  Company  are  not
significant.

During  1998, 1997 and 1996 there was no single customer of the Company
that accounted for 10% or more of consolidated revenues.

The  Company is subject to Federal, state and local environmental  laws
and  regulations relating to, among other things, contingency  planning
for  spills  of  petroleum products, and its  disposal  of  waste  oil.
Additionally, the Company is subject to significant regulations dealing
with  underground fuel storage tanks. The Company stores  some  of  its
fuel for its trucks and tractors in approximately 265 underground tanks
located  in  48 states.  The Company believes that it is in substantial
compliance with all such environmental laws and regulations and is  not
aware of any leaks from such tanks that could reasonably be expected to
have  a  material adverse effect on the Company's competitive position,
operations  or financial position.  However, there can be no assurances
that  environmental matters existing with respect to  the  Company,  or
compliance by the Company with laws relating to environmental  matters,
will  not  have  a  material adverse effect on the Company's  business,
financial position or results of operations.

                                Page 7



The  Company has in place policies and methods designed to conform with
these regulations. The Company estimates that capital expenditures  for
upgrading  underground tank systems and costs associated with  cleaning
activities for 1999 will not be material.

The  Company  has  received  notices from the Environmental  Protection
Agency  and  others  that  it  has been  identified  as  a  potentially
responsible party (PRP) under the Comprehensive Environmental  Response
Compensation  and  Liability Act (CERCLA) or other  Federal  and  state
environmental statutes at various Superfund sites. Under CERCLA,  PRP's
are jointly and severally liable for all site remediation and expenses.
Based  upon  cost studies performed by independent third  parties,  the
Company  believes its obligations with respect to such sites would  not
have a material adverse effect on its financial condition or results of
operations.


(d)  Financial  Information About Foreign and Domestic  Operations  and
       Export Sales.

Geographic information is summarized in Note 10 on page 27 of the  1998
Annual Report to Shareholders and is incorporated herein by reference.


                                Page 8



ITEM 2.   PROPERTIES

The  following  summarizes the terminals and  freight  service  centers
operated by the Company at December 31, 1998.  In general, the  Company
believes  such  facilities are suitable and adequate to  handle  CFCD's
current business needs.  These facilities generally consist of a  large
dock  with  loading  doors, a small office and a  large  yard  for  the
movement of tractors and trailers in the normal business operations.


                         Owned     Leased    Total

                          225       135       360


The  following  table  sets forth the location and  square  footage  of
CFCD's principal freight handling facilities:


                    Location      Square Footage

                    Mira Loma, CA    280,672
                    Chicago, IL      231,159
                    Carlisle, PA     151,100
                    Kansas City, MO  131,916
                 ** Columbus, OH     118,774
                    Memphis, TN      118,745
                    Nashville, TN    118,622
                  * Indianapolis, IN 109,460
                    Orlando, FL      101,557
                  * Minneapolis, MN   94,890
                    Charlotte, NC     89,204
                    St. Louis, MO     88,640
                    Akron, OH         82,494
                    Sacramento, CA    81,286
                    Atlanta, GA       77,920
                    Houston, TX       77,346
                    Dallas, TX        75,358
                  * Freemont, IN      73,760
                  * Peru, IL          73,760
                    Buffalo, NY       73,380
                    Milwaukee, WI     70,661
                    Salt Lake City,UT 68,480
                    Seattle, WA       59,720
                *** Springfield, MA   51,760
                    Portland, OR      47,824
                    Phoenix, AZ       20,237

*    Facility  partially  or wholly financed through  the  issuance  of
industrial revenue  bonds. Principal amount of debt is secured  by  the
property.

**    Property  pledged  as  collateral  for  the   benefit   of   CNF
Transportation  Inc.  for  workers' compensation claims  prior  to  the
Distribution,  as required  under  the Reimbursement   and
Indemnification Agreement dated October 1, 1996.

***  Property  is  leased from a subsidiary of CNF Transportation  Inc.
through December  1, 2005.

                                Page 9



ITEM 3.  LEGAL PROCEEDINGS

The  legal  proceedings  of  the Company  are  summarized  in  Item  8.
Discussions of certain environmental matters are presented in  Items  1
and 7.


ITEM 4.   SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

Not applicable.


                                PART II


ITEM  5.  MARKET  FOR  THE  REGISTRANT'S  COMMON  STOCK  AND  RELATED
           STOCKHOLDER MATTERS

The  Company's common stock is listed for trading on the  NASDAQ  Stock
Market's National Market.  The Company's common stock began trading  on
December  3, 1996. The market price range of the common stock  for  the
period  January  1,  1998 to December 31, 1998  was  $7.50  to  $19.75.
Currently  there  are  no cash dividends paid on the  Company's  common
stock. The Company presently expects that it will not pay a dividend in
1999. The Company's dividend policy thereafter will be dependent on the
circumstances  then in existence.  There can be no assurance,  however,
that the Company will pay any cash dividends on its common stock in the
future.

During  the  third  quarter of 1998, the Company repurchased  1,448,174
shares  of  its  common  stock  for $12.6 million.   Approximately  one
million  of  the  repurchased shares were issued  under  the  Company's
restricted stock program.

As  of  December 31, 1998, there were 34,350 holders of record  of  the
common stock ($.01 par value) of the Company.


ITEM 6.   SELECTED FINANCIAL DATA

The  Selected  Financial Data is presented in the "Five Year  Financial
Summary"  on page 30 of the 1998 Annual Report to Shareholders  and  is
incorporated herein by reference.


ITEM  7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
            AND RESULTS OF OPERATIONS

Management's Discussion and Analysis of Financial Condition and Results
of  Operations is presented on pages 16 through 18 of the  1998  Annual
Report to Shareholders and is incorporated herein by reference.

                                Page 10



Certain  statements  included  or  incorporated  by  reference  herein,
including   certain  statements  under  "Management's  Discussion   and
Analysis of Financial Condition and Results of Operations" referred  to
above,  constitute "forward-looking statements" within the  meaning  of
Section 27A of the Securities Act of 1933, as amended, and Section  21E
of  the Securities Exchange Act of 1934, as amended, and are subject to
a   number  of  risks  and  uncertainties.   Any  such  forward-looking
statements included or incorporated by reference herein should  not  be
relied  upon  as predictions of future events.  Certain  such  forward-
looking  statements  can  be identified by the use  of  forward-looking
terminology  such  as "believes," "expects," "may,"  "will,"  "should,"
"seeks," "approximately," "intends," "plans," "pro forma," "estimates,"
or "anticipates" or the negative thereof or other variations thereof or
comparable  terminology,  or  by  discussions  of  strategy,  plans  or
intentions.  Such forward-looking statements are necessarily  dependent
on  assumptions, data or methods that may be incorrect or imprecise and
they may be incapable of being realized.  In that regard, the following
factors,  among others, and in addition to matters discussed  elsewhere
herein  and in documents incorporated by reference herein, could  cause
actual  results and other matters to differ materially  from  those  in
such  forward-looking  statements:  changes  in  general  business  and
economic   conditions;   increases  in   domestic   and   international
competition and pricing pressure; increases in fuel prices; uncertainty
regarding the Company's ability to improve results of operations; labor
matters,  including shortages of drivers and increases in labor  costs;
changes  in  governmental regulation, environmental  and  tax  matters,
increases  in  costs associated with the conversion  of  financial  and
operational  systems  and  applications for Year  2000  compliance  and
failure  to convert all systems by the year 2000.  As a result  of  the
foregoing, no assurance can be given as to future results of operations
or financial condition.


ITEM 7A. QUANTITITIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Quantitative  and  qualitative  disclosures  about  market   risk   are
presented on page 17 of the 1998 Annual Report to Shareholders  and  is
incorporated herein by reference.


ITEM 8.   FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

The   Consolidated  Financial  Statements  and  Auditors'  Report   are
presented on pages 19 through 28, inclusive, of the 1998 Annual  Report
to Shareholders subject to the following paragraph and are incorporated
herein  by  reference.   The  unaudited  quarterly  financial  data  is
included  on page 29 of the 1998 Annual Report to Shareholders  and  is
incorporated herein by reference.

Footnote 9 "Contingencies" from the Company's 1998 Annual Report, filed
as Exhibit 13 to this Form 10-K, has been intentionally omitted, and is
replaced with the following:


"9. Contingencies

The  Company  and  its  subsidiaries are involved in  various  lawsuits
incidental  to  their businesses. It is the opinion of management  that
the  ultimate outcome of these actions will not have a material adverse
effect on the Company's financial position or results of operations.

The  Company's  former parent, CNF Transportation Inc., is  engaged  in
disputes  with the Internal Revenue Service over the amount and  timing
of  certain tax deductions reported by the former parent in  tax  years
prior  to  the spin-off of the Company. These disputes arise  from  tax
positions  first  taken  by the former parent in  the  mid-1980's.  The
former  parent,  which  is  contesting the IRS's  positions,  has  made
certain advance payments to the IRS which would be applied against  any
ultimate liability.

                                Page 11



Under a tax sharing agreement entered into by the former parent and the
Company at the time of the spin-off, the Company could be obligated  to
reimburse  the former parent for a portion of any additional taxes  and
interest  which relate to the Company's business prior to the spin-off.
The  amount  and timing of such payments, if any, is dependent  on  the
ultimate  resolution of the former parent's disputes with the  IRS  and
the determination of the nature and extent of the Company's obligations
under the tax sharing arrangement.  The Company has established certain
reserves  both  at  the  time of and subsequent to  the  spin-off  with
respect to the foregoing.

In  March  1999,  the 10th Circuit Court of Appeals  ruled  against  an
appealing  taxpayer  in  a  multi-employer  pension  plan  tax   matter
involving  facts  similar  to those underlying  one  of  the  principal
disputes  between  the former parent and the IRS and  relating  to  the
Company's  business prior to the spin-off.  Given this recent decision,
and  the  uncertainties  surrounding  the  amount  and  timing  of  any
obligations of the Company under the tax sharing agreement,  there  can
be  no  assurance  that the amount or timing of any  liability  of  the
Company to the former parent will not have a material adverse effect on
the Company's results of operations or financial position.

The  Company  has  received  notices from the Environmental  Protection
Agency  (EPA)  and others that it has been identified as a  potentially
responsible party (PRP) under the Comprehensive Environmental  Response
Compensation  and  Liability Act (CERCLA) or other  Federal  and  state
environmental statutes at various Superfund sites.  Under CERCLA, PRP's
are jointly and severally liable for all site remediation and expenses.
Based  upon  cost studies performed by independent third  parties,  the
Company  believes its obligations with respect to such sites would  not
have a material adverse effect on its financial position or results  of
operations."


ITEM  9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
           AND FINANCIAL  DISCLOSURE

None.

                                Page 12



                               PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

The  identification of the Company's Directors is presented on pages  2
and  3  of  the  Company's 1999 Proxy Statement  and  those  pages  are
incorporated herein by reference.

The  Executive Officers of the Company, their ages at December 31, 1998
and their applicable business experience are as follows:

W.  Roger  Curry,  60,  President and Chief Executive  Officer  of  the
Company since December 2, 1996.  Mr. Curry has served as President  and
Chief Executive Officer of CFCD since July 1994. Mr. Curry served as  a
Senior  Vice  President of the former parent from 1986 to  December  2,
1996.   In  1991,  he  was  elected  President  of  Emery  Air  Freight
Corporation, relinquishing the position in 1994 to become President  of
CFCD.

Patrick  H.  Blake,  49, Executive Vice President - Operations  of  the
Company since December 2, 1996.  Mr. Blake has served as Executive Vice
President  - Operations of CFCD since July 1994. He was Vice  President
Eastern Region of CFCD from 1992-1994 and a Division Manager from 1985-
1992.

David  F.  Morrison, 45, Executive Vice President and  Chief  Financial
Officer of the Company since December 2, 1996.  Mr. Morrison served  as
Vice President and Treasurer of the former parent from October 1991  to
October  1996  when  he  became  Executive  Vice  President  and  Chief
Financial Officer of CFCD.

Stephen  D. Richards, 55, Senior Vice President and General Counsel  of
the  Company  since  December  2, 1996.  Mr.  Richards  has  been  Vice
President  and General Counsel of CFCD since September  1995.   He  was
Deputy  General  Counsel of the former parent for  the  preceding  four
years.

Thomas A. Paulsen, 55, Senior Vice President - Operations of CFCD since
August 1, 1998.  Mr. Paulsen was a Vice President of CFCD from March 1,
1985 to July 31, 1998.

Joseph R. Schillaci, 56, Executive Vice President - Sales and Marketing
of  the  Company since April 1997.  Prior to joining the  Company,  Mr.
Schillaci  was  president and chief operating officer of  Petro  Travel
Plazas, LP, a national fueling, maintenance and retail provider to  the
trucking industry, since 1993.

Robert  E. Wrightson, 59, Senior Vice President and Controller  of  the
Company  since  December 2, 1996.  Mr. Wrightson has served  as  Senior
Vice  President  and  Controller of CFCD since  July  1994.   Prior  to
joining  CFCD,  he  was  Vice President and Controller  of  the  former
parent, assuming that position in 1989.


ITEM 11. EXECUTIVE COMPENSATION

The  required information for Item 11 is presented on pages  6  through
11,  inclusive, of the Company's 1999 Proxy Statement, and those  pages
are incorporated herein by reference.

                                Page 13



ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The  required information for Item 12 is included on pages 4 and 13  of
the  Company's  1999  Proxy  Statement and is  incorporated  herein  by
reference.


ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Not applicable.


                                PART IV


ITEM  14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON
           FORM 8-K

(a) Financial Statements and Exhibits Filed

    1. Financial Statements
         See Index to Financial Information.

    2. Financial Statement Schedules
         See Index to Financial Information.

    3. Exhibits
         See Index to Exhibits.

(b)  Reports on Form 8-K

       No reports on Form 8-K were filed in the quarter ended
        December 31, 1998.

                                Page 14





                              SIGNATURES

Pursuant  to the requirements of Section 13 or 15(d) of the  Securities
Exchange  Act  of 1934, the Registrant has duly caused this  Form  10-K
Annual  Report to be signed on its behalf by the undersigned, thereunto
duly authorized.



                                   CONSOLIDATED FREIGHTWAYS CORPORATION

                                              (Registrant)




March 26, 1999                     /s/W. Roger Curry
                                   W. Roger Curry
                                   President and Chief Executive Officer




March 26, 1999                     /s/David F. Morrison
                                   David F. Morrison
                                   Executive Vice President and
                                    Chief Financial Officer




March 26, 1999                     /s/Robert E. Wrightson
                                   Robert E. Wrightson
                                   Senior Vice President and Controller


                                Page 15



                              SIGNATURES

Pursuant  to the requirements of the Securities Exchange Act  of  1934,
this report has been signed below by the following persons on behalf of
the Registrant and in the capacities and on the dates indicated.


March 26, 1999                     /s/William D. Walsh
                                    William D. Walsh, Chairman  of
                                     the Board


March 26, 1999                     /s/W. Roger Curry
                                   W. Roger Curry
                                   President, Chief Executive Officer
                                     and Director


March 26, 1999                     /s/G. Robert Evans
                                   G. Robert Evans, Director



March 26, 1999                     /s/Paul B. Guenther
                                   Paul B. Guenther, Director



March 26, 1999                     /s/John M. Lillie
                                   John M. Lillie, Director


                                Page 16



                    CONSOLIDATED FREIGHTWAYS CORPORATION
                               FORM 10-K
                     Year Ended December 31, 1998

_______________________________________________________________________



                    INDEX TO FINANCIAL INFORMATION

Consolidated Freightways Corporation and Subsidiaries

The   following  Consolidated  Financial  Statements  of   Consolidated
Freightways Corporation and Subsidiaries appearing on pages 19  through
28,  inclusive, of the Company's 1998 Annual Report to Shareholders are
incorporated herein by reference:

     Report of Independent Public Accountants

     Consolidated Balance Sheets - December 31, 1998 and 1997

     Statements of Consolidated Operations - Years Ended December  31,
         1998, 1997 and 1996

     Statements of Consolidated Cash Flows - Years Ended December  31,
         1998, 1997 and 1996

     Statements  of Consolidated Shareholders' Equity  -  Years  Ended
         December 31, 1998, 1997 and 1996

     Notes to Consolidated Financial Statements

In   addition  to  the  above,  the  following  consolidated  financial
information is filed as part of this Form 10-K:

                                                             Page

     Consent of Independent Public Accountants                18

     Report of Independent Public Accountants                 18

     Schedule II - Valuation and Qualifying Accounts          19


The  other  schedules  have been omitted because either  (1)  they  are
neither  required  nor applicable or (2) the required  information  has
been  included  in  the  consolidated  financial  statements  or  notes
thereto.

                                Page 17



                               SIGNATURE

               CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS



As independent public accountants, we hereby consent to the
incorporation of our reports included and incorporated by reference in
this Form 10-K, into Consolidated Freightways Corporation's (the
Company) previously filed Registration Statement File Nos. 333-16851,
333-16835 and 333-25167.  As independent public accountants, we also
hereby consent to the application of our report dated January 25, 1999
in the Company's annual report to shareholders incorporated by
reference in this Form 10-K to the supplemental note to the financial
statements included in Item 8, Financial Statements and Supplementary
Data and labeled "9.  Contingencies."  It should be noted that we have
performed no audit procedures subsequent to January 25, 1999, the date
of our report, except with respect to the supplemental note as to which
the date is March 9, 1999.  Furthermore, we have not audited any
financial statements of the Company as of any date or for any period
subsequent to December 31, 1998.

                                   /s/Arthur Andersen LLP
                                   ARTHUR ANDERSEN LLP


Portland, Oregon,
  March 26, 1999




               REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS


To the Shareholders and Board of Directors of
Consolidated Freightways Corporation:

We have audited in accordance with generally accepted auditing
standards, the consolidated financial statements included in
Consolidated Freightways Corporation's 1998 Annual Report to
Shareholders incorporated by reference in this Form 10-K, and have
issued our report thereon dated January 25, 1999 (except with respect
to the matter discussed in Item 8, Financial Statements and
Supplemental Data and labeled "9. Contingencies," as to which the date
is March 9, 1999).  Our audit was made for the purpose of forming an
opinion on those statements taken as a whole.  The Schedule on page 19
is the responsibility of the Company's management and is presented for
the purpose of complying with the Securities and Exchange Commission's
rules and is not part of the basic financial statements.  This schedule
has been subjected to the auditing procedures applied in the audit of
the basic financial statements and, in our opinion, fairly states in
all material respects the financial data required to be set forth
therein in relation to the basic financial statements taken as a whole.

                                          /s/Arthur Andersen LLP
                                          ARTHUR ANDERSEN LLP

Portland, Oregon,
  January 25, 1999


                                Page 18


                                SCHEDULE II

                    CONSOLIDATED FREIGHTWAYS CORPORATION
                     VALUATION AND QUALIFYING ACCOUNTS
                    THREE YEARS ENDED DECEMBER 31, 1998
                               (In thousands)

DESCRIPTION

ALLOWANCE FOR DOUBTFUL ACCOUNTS



          BALANCE AT  CHARGED TO  CHARGED TO                  BALANCE AT
          BEGINNING   COSTS AND     OTHER                       END OF
          OF PERIOD    EXPENSES    ACCOUNTS   DEDUCTIONS        PERIOD

1998      $ 7,467     $15,127     $  -        $(11,181)(a)     $11,413


1997      $ 9,692     $ 8,374     $  -        $(10,599)(a)     $ 7,467


1996      $ 9,349     $ 6,534     $  -        $ (6,191)(a)     $ 9,692



a)   Accounts written off net of recoveries.


                                Page 19



                           INDEX TO EXHIBITS
                             ITEM 14(a)(3)

Exhibit No.

(2) Plan of acquisition, reorganization, arrangement, liquidation or
      succession:
      2.1 Distribution Agreement between Consolidated Freightways
          Corporation and Consolidated Freightways, Inc., dated
          November 25, 1996.  (Exhibit 2.1 to the Company's
          Form 8-K dated March 12, 1997.) (*)

(3)  Articles of incorporation and bylaws:
     3.1  Amended and Restated Certificate of Incorporation of
          Consolidated Freightways Corporation. (Exhibit 3.1 to
          the Company's Form 10 filed October 2, 1996) (*)
     3.2  Amended and Restated Bylaws of Consolidated Freightways
          Corporation.

(10) Material Contracts:
     10.1 Transition Services Agreement between Consolidated
          Freightways Corporation and CNF Service Company, Inc., dated as of
          December 2, 1996. (Exhibit 10.1 to the Company's Form 8-K dated
          March 12, 1997.) (*)
     10.2 Alternative Dispute Resolution Agreement Between
          Consolidated Freightways Corporation and Consolidated Freightways,
          Inc., dated as of December 2, 1996. (Exhibit 10.2 to the Company's
          Form 8-K dated March 12,   1997.) (*)
     10.3 Employee Benefit Matters Agreement between Consolidated
          Freightways Corporation and Consolidated Freightways, Inc., dated as
          of December 2,   1996. (Exhibit 10.3 to the Company's Form 8-K dated
          March 12, 1997.) (*)
     10.4 Tax Sharing Agreement between Consolidated Freightways
          Corporation and  Consolidated Freightways, Inc., dated as of
          December 2, 1996.(Exhibit 10.4 to the Company's Form 8-K
          dated March 12, 1997.) (*)
     10.5 Reimbursement and Indemnification Agreement between
          Consolidated Freightways Corporation of Delaware and Consolidated
          Freightways, Inc., dated as of October 1, 1996. (Exhibit 10.5 to
          the Company's Form 8-K dated March 12, 1997.) (*)
     10.6 Consolidated Freightways Corporation 1996 Stock Option and
          Incentive Plan. (Exhibit 10.6 to the Company's Form 10 filed
          October 2, 1996)(*)(#)
     10.7 Loan and Security Agreement among Consolidated Freightways
          Corporation of Delaware, BankAmerica Business Credit Inc. and various
          other financial  institutions dated as of November 27, 1996. (Exhibit
          10.7 to the Company's Form 10-K for the year ended
          December 31, 1996.)(*)
     10.8 Consolidated Freightways Corporation 1996 Restricted Stock Award
          Agreements. (Exhibit 10.8 to the Company's Form 10-K for the year
          ended December 31, 1996.) (*)(#)
     10.9 Consolidated Freightways Corporation Senior Executive Incentive
          Plan for 1999. (#)


(*) Previously filed with the Securities and Exchange Commission and
     incorporated by reference.
(#) Designates a contract or compensation plan for Management or
     Directors.

                                Page 20


                           INDEX TO EXHIBITS
                             ITEM 14(a)(3)

Exhibit No.

    10.10 Consolidated Freightways Corporation Deferred Compensation
          Plan for Executives. (Exhibit 10.10 to the Company's
          Form 10-K for the year ended December 31, 1996.)(*)(#)
    10.11 Consolidated Freightways Corporation Supplemental
          Executive Retirement Plan. (Exhibit 10.11 to the
          Company's Form 10-K for the year ended
          December 31, 1996.) (*)(#)
    10.12 Consolidated Freightways Inc. Executive Split-Dollar
          Life Insurance Plan. (Exhibit 10.12 to the Company's
          Form 10-K for the year ended December 31, 1996.) (*)(#)
    10.13 Participation Agreement dated as of December 22, 1995
          between Consolidated Freightways Corporation of
          Delaware, as lessee, and ABN AMRO Bank N.V., as lessor,
          as amended. (Exhibit 10.1 to the Company's Form 10-Q
          for the quarter ended March 31, 1997.)(*)
    10.14 Participation Agreement dated as of September 30, 1994
          between Consolidated Freightways Corporation of
          Delaware, as lessee, and BA Leasing & Capital
          Corporation and various other financial
          institutions, as lessors, as amended. (Exhibit 10.2 to
          the Company's Form 10-Q for the quarter ended
          March 31, 1997.)(*)
    10.15 Reimbursement and Security Agreement dated July 3, 1997
          between Consolidated Freightways Corporation and
          CNF Transportation Inc. (Exhibit 10.1 to the Company's
          Form 10-Q for the quarter ended June 30, 1997.)(*)
    10.16 Third Amendment to Participation Agreement and Master Lease
          intended as Security dated December 12, 1997 between Consolidated
          Freightways Corporation of Delaware and ABN AMRO Bank
          N.V.  (Exhibit 10.16 to the Company's Form 10-K for the year
          ended December 31, 1997)(*)
    10.17 Amendment No. 3 to Loan and Security Agreement dated November
          1, 1997 between Consolidated Freightways Corporation of
          Delaware and BankAmerica Business Credit, Inc.
         (Exhibit 10.17 to the Company's Form 10-K  for the year ended
          December 31, 1997)(*)
    10.18 Amendment No. 4 to Loan and Security Agreement dated July 2,
          1998 between Consolidated Freightways Corporation of Delaware
          and BankAmerica Business Credit, Inc. (Exhibit 10.1 to the
          Company's Form 10-Q for the quarter ended June 30, 1998)(*)
    10.19 Consolidated Freightways Corporation 1999 Equity Incentive Plan. (#)
    10.20 Consolidated Freightways Corporation Non-Employee Directors'
          Equity Plan. (#)
    10.21 Employment Agreements with Senior Management. (#)
    10.22 Consolidated Freightways Corporation Management Change-of-Control
          Plan. (#)


(*) Previously filed with the Securities and Exchange Commission and
     incorporated by reference.
(#) Designates a contract or compensation plan for Management or
     Directors.

                                Page 21







                           INDEX TO EXHIBITS
                             ITEM 14(a)(3)

Exhibit No.

(13)      Annual Report to Security Holders:

       Consolidated  Freightways  Corporation  1998  Annual  Report  to
Shareholders.  (Only those portions referenced herein are  incorporated
in  this Form 10-K. Other portions such as the "Letter to Shareholders"
are not required and therefore not "filed" as part of this Form 10-K.)

(21)      Significant Subsidiaries of the Company

(27)      Financial Data Schedule


                                Page 22