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

                                    FORM 10-Q

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

                 For the quarterly period ended January 31, 2002

                                       OR

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

                        For the transition period from to
                                   ----------
                         Commission File Number 1-4146-1
                                   ----------

                         NAVISTAR FINANCIAL CORPORATION
             (Exact name of Registrant as specified in its charter)


           Delaware                                   36-2472404
(State or other jurisdiction of             (I.R.S. Employer Identification No.)
 incorporation or organization)


2850 West Golf Road Rolling Meadows, Illinois             60008
  (Address of principal executive offices)             (Zip Code)

         Registrant's telephone number including area code 847-734-4000

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  and  (2) has  been  subject  to such  filing
requirements for the past 90 days. Yes X No

                       APPLICABLE ONLY TO ISSUERS INVOLVED
                        IN BANKRUPTCY PROCEEDINGS DURING
                            THE PRECEDING 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:

As of February 28, 2002, the number of shares  outstanding  of the  registrant's
common stock was 1,600,000.

THE   REGISTRANT  IS  A  WHOLLY-OWNED   SUBSIDIARY  OF  NAVISTAR   INTERNATIONAL
CORPORATION AND MEETS THE CONDITIONS SET FORTH IN GENERAL  INSTRUCTIONS  H(1)(a)
AND (b) OF FORM  10-Q  AND IS  THEREFORE  FILING  THIS  FORM  WITH  THE  REDUCED
DISCLOSURE FORMAT.
<PAGE>


                         NAVISTAR FINANCIAL CORPORATION
                                AND SUBSIDIARIES



                                      INDEX

                                                                       Page


PART I.   FINANCIAL INFORMATION

   Item 1.   Financial Statements:

      Statements of Consolidated Income and Retained Earnings --
        Three Months Ended January 31, 2002 and 2001. . . . . . . . . .  2

      Statements of Consolidated Financial Condition --
        January 31, 2002; October 31, 2001; and January 31, 2001. . . .  3

      Statements of Consolidated Cash Flow --
        Three Months Ended January 31, 2002 and 2001. . . . . . . . . .  4

      Notes to Consolidated Financial Statements  . . . . . . . . . . .  5

   Item 2.   Management's Discussion and Analysis of Results of
                Operations and Financial Condition. . . . . . . . . . . 13


PART II.   OTHER INFORMATION

   Item 6.   Exhibits and Reports on Form 8-K. . . . . . . . . . . . .  17

Signature . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17


<PAGE>



                         PART I - FINANCIAL INFORMATION

Item 1.   Financial Statements

                 Navistar Financial Corporation and Subsidiaries
       Statements of Consolidated Income and Retained Earnings (Unaudited)
                               Millions of Dollars
                                                        January      January
Three Months Ended                                       2002          2001
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Revenues
              Retail Notes  . . . . . . . . . . . . . .  $ 28.5       $ 21.7
              Lease Financing . . . . . . . . . . . . .    22.2         25.8
              Wholesale Notes . . . . . . . . . . . . .     6.5         13.2
              Accounts  . . . . . . . . . . . . . . . .     5.4          8.7
              Servicing Fee Income  . . . . . . . . . .     6.3          8.2
              Marketable Securities . . . . . . . . . .     3.1          7.7
                          Total . . . . . . . . . . . .    72.0         85.3

Expenses
              Cost of Borrowing
                          Interest Expense. . . . . . .    14.5         30.0
                          Other . . . . . . . . . . . .     1.9          1.7
                          Total . . . . . . . . . . . .    16.4         31.7
              Credit, Collection and Administrative . .    10.0         10.9
              Provision for Losses on Receivables . . .     4.3          6.5
              Depreciation Expense and Other. . . . . .    14.1         15.4
                          Total . . . . . . . . . . . .    44.8         64.5

Income Before Taxes. . . . . . . . . . . . . . . . . .     27.2         20.8

Taxes on Income. . . . . . . . . . . . . . . . . . . .     10.5          8.0

Income from Continuing Operations. . . . . . . . . . .     16.7         12.8
Gain on Disposal of Discontinued Operations,
              (net of tax of $0.5 and $(0.0)) . . . .       0.7            -
Net Income . . . . . . . . . . . . . . . . . . . . . .     17.4         12.8

Retained Earnings
              Beginning of Period . . . . . . . . . .     163.4        134.9
              Dividends Paid. . . . . . . . . . . . .         -            -
              End of Period . . . . . . . . . . . . .    $180.8       $147.7



See Notes to Consolidated Financial Statements.
<PAGE>

               Navistar Financial Corporation and Subsidiaries

           Statements of Consolidated Financial Condition (Unaudited)
                               Millions of Dollars
<TABLE>
<S>                                                                 <C>            <C>              <C>
                                                                  January        October         January
                                                                    2002           2001            2001
---------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------

ASSETS

Cash and Cash Equivalents . . . . . . . . . . . . . . . . . . .    $ 44.5         $ 22.3          $ 81.8
Finance Receivables
              Retail Notes. . . . . . . . . . . . . . . . . . .     366.6          634.1           323.8
              Lease Financing . . . . . . . . . . . . . . . . .     213.5          211.5           222.4
              Wholesale Notes . . . . . . . . . . . . . . . . .      36.1           31.7            58.4
              Accounts. . . . . . . . . . . . . . . . . . . . .     132.8          215.5           217.1
                                                                    749.0        1,092.8           821.7
              Allowance for Losses. . . . . . . . . . . . . . .     (13.7)         (13.3)           (8.8)
                          Finance Receivables, Net. . . . . . .     735.3        1,079.5           812.9

Amounts Due from Sales of Receivables . . . . . . . . . . . . .     391.7          323.5           356.8
Net Investment in Operating Leases. . . . . . . . . . . . . . .     273.8          283.8           308.7
Repossessions . . . . . . . . . . . . . . . . . . . . . . . . .      67.9           77.7            55.2
Restricted Marketable Securities. . . . . . . . . . . . . . . .     455.6          213.7           394.9
Other Assets. . . . . . . . . . . . . . . . . . . . . . . . . .      33.9           48.5            26.7
Net Assets of Discontinued Operations . . . . . . . . . . . . .        -            61.9            48.8

Total Assets. . . . . . . . . . . . . . . . . . . . . . . . . .  $2,002.7       $2,110.9        $2,085.8

LIABILITIES AND SHAREOWNER'S EQUITY

Net Accounts Payable to Affiliates. . . . . . . . . . . . . . .    $ 86.1         $ 14.2          $ 15.2
Other Liabilities . . . . . . . . . . . . . . . . . . . . . . .      90.6           90.6            58.1
Senior and Subordinated Debt. . . . . . . . . . . . . . . . . .   1,454.7        1,652.6         1,671.6
Dealers' Reserves . . . . . . . . . . . . . . . . . . . . . . .      21.9           22.2            23.7

Shareowner's Equity
              Capital Stock (Par value $1.00, 1,600,000 shares
                issued and outstanding) and paid-in capital . .     171.0          171.0           171.0
              Retained Earnings . . . . . . . . . . . . . . . .     180.8          163.4           147.7
              Accumulated Other Comprehensive Loss. . . . . . .      (2.4)          (3.1)           (1.5)
                          Total . . . . . . . . . . . . . . . .     349.4          331.3           317.2

Total Liabilities and Shareowner's Equity . . . . . . . . . . .  $2,002.7       $2,110.9        $2,085.8

</TABLE>

See Notes to Consolidated Financial Statements.
<PAGE>

                 Navistar Financial Corporation and Subsidiaries
                Statements of Consolidated Cash Flow (Unaudited)
                               Millions of Dollars
<TABLE>
<S>                                                                             <C>            <C>
                                                                              January       January
Three Months Ended                                                             2002          2001
Cash Flow From Operations
              Net Income. . . . . . . . . . . . . . . . . . . . . . . . . .    $17.4        $ 12.8
              Adjustment to reconcile net income to
              cash provided from operations:
              Gains on sales of receivables . . . . . . . . . . . . . . . .    (17.2)         (9.2)
              Depreciation and amortization . . . . . . . . . . . . . . . .     14.6          16.0
              Provision for losses on receivables . . . . . . . . . . . . .      4.3           6.5
              Increase (decrease) in accounts payable to affiliates . . . .     71.9        (251.2)
              Other . . . . . . . . . . . . . . . . . . . . . . . . . . . .     19.9           7.2
                          Total. . . . . . . . . . . . . . . . . . . . . . .   110.9        (217.9)
Cash Flow From Investing Activities
              Proceeds from sold retail notes . . . . . . . . . . . . . . .    431.8         924.4
              Purchases of retail notes and lease receivables . . . . . . .   (175.5)       (225.5)
              Principal collections on retail notes and lease receivables,
                 net of change in unearned finance income . . . . . . . . .    (35.6)        (25.6)
              (Repurchase of) proceeds from sold wholesale notes, net . . .    (72.0)        (91.5)
              Cash collections, net of acquisitions, for wholesale
                 notes and accounts receivable. . . . . . . . . . . . . . .    150.2         115.8
              Proceeds from sold retail accounts. . . . . . . . . . . . . .        -         105.0
              Net (purchase)/sale or maturities of restricted
                 marketable securities. . . . . . . . . . . . . . . . . . .   (241.9)       (310.6)
              Purchase of equipment leased to others. . . . . . . . . . . .    (34.6)        (51.4)
              Sale of equipment leased to others. . . . . . . . . . . . . .     24.6          19.0
              Proceeds from sale of discontinued operations . . . . . . . .     62.2             -
                          Total. . . . . . . . . . . . . . . . . . . . . . .   109.2         459.6
Cash Flow From Financing Activities
              Net decrease in bank revolving credit facility usage. . . . .   (193.0)       (215.0)
              Proceeds from long-term debt. . . . . . . . . . . . . . . . .     31.2          54.8
              Principal payments on long-term debt. . . . . . . . . . . . .    (36.1)        (42.2)
                          Total. . . . . . . . . . . . . . . . . . . . . . .  (197.9)       (202.4)
Increase in Cash and Cash Equivalents from
   Continuing Operations . . . . . . . . . . . . . . . . . . . . . . . . . .    22.2          39.3
Net Cash from Discontinued Operations. . . . . . . . . . . . . . . . . . . .       -           0.9
Cash and Cash Equivalents at Beginning of Period . . . . . . . . . . . . . .    22.3          41.6
Cash and Cash Equivalents at End of Period . . . . . . . . . . . . . . . . .   $44.5         $81.8
Supplementary disclosure of cash flow information:
  Interest paid. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   $19.3         $34.8
  Income taxes paid (refunded), net. . . . . . . . . . . . . . . . . . . . .   $ 2.3         $(3.5)

See Notes to Consolidated Financial Statements.
</TABLE>

<PAGE>

                         NAVISTAR FINANCIAL CORPORATION
                                AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)


1.   The  consolidated  financial  statements  include the  accounts of Navistar
     Financial   Corporation   ("NFC")   and   its   wholly-owned   subsidiaries
     ("Corporation").     International    Truck    and    Engine    Corporation
     ("International"),   which  is  wholly-owned   by  Navistar   International
     Corporation ("Navistar"), is the parent company of the Corporation.

     The  accompanying  unaudited  consolidated  financial  statements have been
     prepared  in  accordance   with  accounting   policies   described  in  the
     Corporation's  2001  Annual  Report  on Form  10-K  and  should  be read in
     conjunction with the disclosures therein.

     In  the  opinion  of  management,   these  interim  consolidated  financial
     statements   reflect  all  adjustments,   consisting  of  normal  recurring
     accruals, necessary to present fairly the results of operations,  financial
     condition and cash flow for the interim periods presented.  Interim results
     are not necessarily indicative of results to be expected for the full year.
     Certain  2001  amounts   have  been   reclassified   to  conform  with  the
     presentation used in the 2002 financial statements.

2.   The  Corporation  uses  derivative  financial  instruments  as  part of its
     overall interest rate risk management  strategy as further  described under
     Footnote 12 of the 2001 Annual Report on Form 10-K.

     The  Corporation  is exposed to interest  rate risk  relating to changes in
     market interest rates. As part of its overall  strategy to manage the level
     of exposure to the risk of interest rates adversely  affecting net interest
     income or expense,  the  Corporation  uses interest  rate swap  agreements,
     interest  rate  caps,  and  forward  contracts.  The  Corporation  is  also
     occasionally  required by third parties to use  derivative  instruments  to
     make financing possible under sold note arrangements. These derivatives are
     used in asset-backed transactions in order to absorb some portfolio-related
     risks. The Corporation's  policy prohibits the use of derivative  financial
     instruments for speculative purposes.

     On the date the Corporation enters into a derivative  contract,  management
     designates the derivative as either a hedging or a non-hedging  instrument.
     Additionally,   management   distinguishes   between  fair  value   hedging
     instruments,   cash  flow  hedging   instruments,   and  other   derivative
     instruments.

<PAGE>

                         NAVISTAR FINANCIAL CORPORATION
                                AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)


     The   Corporation   documents  and  accounts  for  derivative  and  hedging
     activities in accordance with the provisions of SFAS 133. In general,  SFAS
     133  requires  that an  entity  recognize  all  derivatives  as  assets  or
     liabilities  in the  statement of financial  condition  and measure them at
     fair value.  When certain  criteria are met, it also  provides for matching
     the timing of gain or loss recognition on the derivative hedging instrument
     with the  recognition of (a) changes in the fair value or cash flows of the
     hedged  asset  or  liability  attributable  to the  hedged  risk or (b) the
     earnings effect of the hedged forecasted  transaction.  Changes in the fair
     value of  derivatives  which are not designated as, or which do not qualify
     as, hedges for accounting purposes are reported in earnings.

     In connection  with the $179.0 million  floating rate portion of the $500.0
     million  sale of retail note  receivables  that closed on November 1, 2001,
     the Corporation  entered into two interest rate swaps.  The notional amount
     of each interest rate swap was $179.0  million.  As of January 31, 2002 the
     fair value of the swaps were offsetting  immaterial amounts. The purpose of
     these swaps was to convert  the  floating  rate  interest of the bonds into
     fixed rate  interest to match the interest  basis of the  receivables  pool
     sold to the owner trust,  and to protect the Corporation from interest rate
     volatility.  The net  outcome,  after  applying  the effect of these swaps,
     results in the Corporation paying a fixed rate of interest on the projected
     balance of the pool.  To the extent that actual pool  balances  differ from
     the projected balances, the Corporation has retained interest rate exposure
     on this difference.  These two derivatives are accounted for as non-hedging
     derivative instruments.

     As of January 31, 2002, the Corporation has several outstanding  derivative
     instruments  that were entered into prior to the first quarter of 2002. One
     interest rate swap is classified as a cash flow hedge derivative instrument
     with a notional  amount of $34.0 million and a fair value as of January 31,
     2002 of ($0.9) million. The fair value of this derivative  instrument as of
     January  31,  2002 is recorded in Other  Liabilities  in the  Statement  of
     Consolidated  Financial  Condition  and the  change  in fair  value for the
     quarter is recorded in Other  Comprehensive  Income as a gain in the amount
     of $0.7 million. The Corporation has two interest rate swap agreements with
     notional  amounts of $7.0  million and $29.0  million and as of January 31,
     2002 the fair values were ($0.4) and $0.7,  respectively.  The  Corporation
     has three interest rate caps that are classified as non-hedging  derivative
     instruments  with notional  amounts of $48.0  million,  $500.0  million and
     $500.0  million and as of January 31, 2002 the fair value was $0.1 million,
     $6.0  million and ($6.0)  million,  respectively.  The fair values of these
     derivative  instruments  as of  January  31,  2002  are  recorded  in Other
     Liabilities  in the  Statement of  Consolidated  Financial  Condition.  The
     changes in fair value for the quarter were  recorded in Retail Note Revenue
     and were not material.

<PAGE>


                         NAVISTAR FINANCIAL CORPORATION
                                AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)


3.   On  November  30,  2000,  the  Corporation's  Board of  Directors  approved
     management's  plan  for  the  sale  of  Harco  National  Insurance  Company
     ("Harco"), the wholly-owned insurance subsidiary. On November 30, 2001, the
     Corporation  completed  the  sale  of all  of the  stock  of  Harco  to IAT
     Reinsurance Syndicate Ltd., a Bermuda reinsurance company. Cash proceeds of
     $63.3 million were received  through  February  2002.  The Harco  insurance
     segment is accounted  for as a  discontinued  operation,  and  accordingly,
     amounts in the consolidated  financial statements and notes thereto for all
     periods  shown  have  been  restated  to  reflect  discontinued  operations
     accounting.


4.   The  Corporation's  primary  business is to provide  wholesale,  retail and
     lease  financing  for  new  and  used  trucks  sold  by  International  and
     International's dealers, and as a result, the Corporation's receivables and
     leases  have  significant  concentration  in the  trucking  industry.  On a
     geographic basis, there is not a  disproportionate  concentration of credit
     risk  in  any  area  of the  United  States.  The  Corporation  retains  as
     collateral a security  interest in the equipment  associated with wholesale
     notes, retail notes and leases.

     The Corporation  securitizes and sells finance receivables through Navistar
     Financial Retail  Receivables  Corporation  ("NFRRC"),  Navistar  Financial
     Securities Corporation ("NFSC"), Truck Retail Accounts Corporation ("TRAC")
     and Truck Engine Receivables Financing Corporation ("TERFCO"),  all special
     purpose, wholly-owned subsidiaries of the Corporation. The sales of finance
     receivables in each of the securitizations constitute sales under generally
     accepted accounting  principles,  with the result that the sold receivables
     are  removed  from  the  Corporation's  balance  sheet  and the  investor's
     interests in the related trust or conduit are not reflected as liabilities.
     However,  the special  purpose  entity's  residual  interest in the related
     trusts or assets  held by the conduit are  reflected  on the  Corporation's
     Statement of Consolidated  Financial Condition as assets. NFRRC, NFSC, TRAC
     and TERFCO have limited  recourse on the sold  receivables and their assets
     are available to satisfy the claims of their creditors prior to such assets
     becoming  available for their own uses or to the  Corporation or affiliated
     companies.  The terms of receivable sales generally require the Corporation
     to  maintain   cash  reserves  with  the  trusts  and  conduits  as  credit
     enhancement.  The use of cash  reserves  held by the trusts and conduits is
     restricted under the terms of the securitized sales agreements. The maximum
     exposure under all receivable sale recourse  provisions at January 31, 2002
     was $408.0 million; however,  management believes the recorded reserves for
     losses are adequate.

<PAGE>




                         NAVISTAR FINANCIAL CORPORATION
                                AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)


     At January 31, 2002, the Corporation had a $500.0 million  revolving retail
     warehouse  facility due in October 2005. On October 16, 2000,  Truck Retail
     Instalment  Paper  Corporation  ("TRIP"),  a special  purpose  wholly-owned
     subsidiary of the  Corporation,  issued $475.0  million of senior class AAA
     rated  and  $25.0  million  of  subordinated  class A rated  floating  rate
     asset-backed notes. The proceeds were used to purchase eligible receivables
     from the Corporation and establish a revolving  retail  warehouse  facility
     for the Corporation's retail notes and leases, other than fair market value
     leases.

     The Corporation continues to service the receivables, for which a servicing
     fee is received.  Servicing fees are earned on a level yield basis over the
     terms of the related sold  receivables  and are  included in servicing  fee
     income. Servicing fees are typically set at 1.0% of average outstanding net
     receivable  balances,  representing  the  Corporation's  estimated costs to
     service the receivables.

     Gains or  losses  on sales of  receivables  are  estimated  based  upon the
     present  value  of  future  expected  cash  flows  using   assumptions  for
     prepayment speeds and current market interest rates.  These assumptions use
     management's  best  estimates  commensurate  with the  risks  involved.  An
     allowance for credit losses is provided prior to the  receivables  sale and
     is reclassified to Amounts Due from Sales of Receivables upon sale.

     Finance  receivables  balances  do  not  include  receivables  sold  by the
     Corporation  to  public  and  private   investors  with  limited   recourse
     provisions. Outstanding sold net receivables balances are as follows:

<TABLE>
<S>                                          <C>                   <C>                   <C>
                                     January 31            October 31            January 31
                                       2002                  2001                  2001
                                 -----------------     -----------------     ------------------
                                                       ($ Millions)

      Retail notes.............       $2,041.9               $1,862.6              $2,401.4
      Wholesale notes..........          713.4                  797.3                 791.5
      Retail accounts..........          200.0                  191.3                 185.0
          Total................       $2,955.3               $2,851.2              $3,377.9


</TABLE>
<PAGE>



                         NAVISTAR FINANCIAL CORPORATION
                                AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)


     Additional  financial  data for gross  serviced  finance  receivables as of
     January 31, 2002 is as follows:
<TABLE>

<S>                                                 <C>                <C>                <C>                  <C>
                                                  Retail                               Wholesale
                                                   Notes             Leases              Notes              Accounts
                                              ----------------    --------------    ----------------    -----------------
                                                                            ($ Millions)
      Gross serviced   finance   receivables     $2,612.1            $522.3              $749.5               $332.8

      Gross serviced finance    receivables
      with installments past due
          over 30 days.......................         N/A               N/A                 7.3                 17.2
          over 60 days.......................        37.3              11.9                 N/A                  N/A

      Credit losses net of
        recoveries...........................         3.9               0.3                 0.1                    -
</TABLE>


     During the three months ended January 31, 2002, the Corporation sold $500.0
     million of retail notes, net of unearned finance income, through NFRRC. The
     Corporation sold the retail notes to an owner trust,  which, in turn issued
     $500.0  million of  asset-backed  securities  that were sold to  investors.
     Aggregate gains of $17.2 million were recognized on these sales.

     At January 31,  2002,  NFSC has in place a revolving  wholesale  note trust
     that  provides  for the  funding of $837.0  million of  eligible  wholesale
     notes.  As of  January  31,  2002 the trust is  comprised  of three  $200.0
     million tranches of investor  certificates maturing in 2003, 2004 and 2008,
     a $212.0 million  tranche of investor  certificates  maturing in 2005 and a
     variable funding certificate with a maximum capacity of $25.0 million. This
     facility expires in January 2003, with an option for renewal. TERFCO has in
     place a revolving  trust that provides for the funding of $100.0 million of
     eligible Ford accounts  receivables.  TRAC has in place a revolving  retail
     account conduit that provides for the funding of $100.0 million of eligible
     retail accounts.

<PAGE>

                         NAVISTAR FINANCIAL CORPORATION
                                AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)


     When finance receivables are sold, the Corporation retains interest in  the
     securitized  receivables  in the form of  interest-only  strips,  servicing
     rights, cash reserve accounts and subordinated certificates.  The following
     is a summary of  retained  interests  included in Amounts Due from Sales of
     Receivables as follows:
<TABLE>
<S>                                                                                <C>              <C>                 <C>
                                                                           January 31       October 31          January 31
                                                                              2002             2001                2001
                                                                        ---------------  ------------------  ---------------

                                                                                          ($ Millions)

      Cash held and invested by trusts.................................      $166.7          $146.6               $174.3
      Subordinated retained interests in wholesale receivables.........       127.2           127.1                137.3
      Subordinated retained interests in retail   receivables..........        91.9            56.4                 54.4

      Interest only receivables........................................        22.2            10.1                  9.4
      Allowance for credit losses......................................       (16.3)          (16.7)               (18.6)
         Total.........................................................      $391.7          $323.5               $356.8
</TABLE>

     The fair  value of cash  deposits  included  in  Amounts  Due from Sales of
     Receivables approximate their carrying value due to their short-term nature
     and variable  interest rate terms. The subordinated  retained  interests in
     wholesale receivables  principally consist of wholesale notes or marketable
     securities.  The  subordinated  retained  interests  in retail  receivables
     principally  consist of certain cash collections on finance receivables and
     retail  accounts.  Due to the  short-term  nature of these  assets the fair
     value approximates carrying value.

     Key economic  assumptions  used in measuring the interest only strip at the
     date of the securitization for  securitizations  completed during the first
     quarter and at January 31, 2002 for all outstanding  securitizations,  were
     as follows:
<TABLE>
<S>                                                                 <C>                          <C>
                                                             At date of                  At January 31,
                                                            securitization                    2002
                                                        ------------------------    -----------------------

      Prepayment speed..................................       1.1 - 1.3                    1.3 - 1.5
      Weighted average remaining life...................       41 months                    22 months
      Residual cash flows discount rate.................     6.41% - 9.61%                    6.86%

</TABLE>

     The impact of hypothetical 10% and 20% adverse changes in these assumptions
     would  have no  material  effect  on the fair  value of the  interest  only
     receivables at January 31, 2002. These  sensitivities  are hypothetical and
     should be used with  caution.  The effect of a  variation  of a  particular
     assumption on the fair value of the interest only receivables is calculated
     without changing any other  assumption;  in reality,  changes in one factor
     may result in changes in another.
<PAGE>

                         NAVISTAR FINANCIAL CORPORATION
                                AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)


     The following table  summarizes  certain cash flows received from and (paid
     to)  securitization  trusts/conduits  during the three months ended January
     31, 2002:
                                                                  ($ Millions)
                                                                  ------------
      Proceeds from initial sales of retail receivables.........  $  499.9
      Proceeds from subsequent sales of receivables into
        revolving facilities....................................   1,128.8
      Servicing fees received...................................       6.3
      All other cash received from trusts.......................      45.2
      Purchase of delinquent or foreclosed receivables..........     (13.5)
      Cash used for pool buybacks...............................         -


5.   The allowance for losses on receivables is summarized as follows:

<TABLE>
<S>                                                                   <C>              <C>             <C>
                                                              January 31       October 31      January 31
                                                                  2002             2001            2001
--------------------------------------------------------------------------------------------------------------
                                                                               ($ Millions)
Total allowance for losses at beginning of period...........
                                                                 $30.0            $26.2           $26.2
Provision for losses........................................       4.3             27.8             6.5
Net losses charged to allowance.............................      (4.3)           (24.0)           (5.3)
     Total allowance for losses at end of period............     $30.0            $30.0           $27.4

Allowance pertaining to:
     Owned notes............................................     $13.7            $13.3            $8.8
     Sold notes.............................................      16.3             16.7            18.6
         Total..............................................     $30.0            $30.0           $27.4
</TABLE>


6.   On November 18, 2001 the Corporation entered into an agreement to guarantee
     the  peso-denominated   debt  of  Navistar's  Mexican  finance  subsidiary,
     Servicios  Financieros  Navistar,  S.A.  DE C.V.,  up to the  amount of 500
     million pesos (equivalent to $54.7 million U.S. dollars). As of January 31,
     2002, the outstanding  balance of  peso-denominated  debt was equivalent to
     $54.7 million U.S. dollars.


     At January 31, 2002, the Corporation had a $820.0  contractually  committed
     bank revolving credit facility that will mature in November 2005. Under the
     revolving credit agreement,  Navistar's three Mexican finance  subsidiaries
     are permitted to borrow up to $100.0 in the aggregate,  which is guaranteed
     by the Corporation.  As of January 31, 2002, the outstanding balance on the
     Mexican finance subsidiaries' portion of the revolver was $51 million.

<PAGE>

                         NAVISTAR FINANCIAL CORPORATION
                                AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)


7.   The Corporation's total comprehensive income was as follows:

                                                  Three Months Ended January 31
                                                      2002             2001
                                                           ($ Millions)

      Net Income. . . . . . . . . . . . . . .        $17.4            $12.8
      Change in net unrealized gain on
       derivative . . . . . . . . . . . . .            0.7              -
         Total Comprehensive Income . . . . .        $18.1            $12.8
<PAGE>

                         NAVISTAR FINANCIAL CORPORATION
                                AND SUBSIDIARIES

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


Certain  statements under this caption,  which involve risks and  uncertainties,
constitute  "forward-looking   statements"  under  the  Securities  Reform  Act.
Navistar Financial  Corporation's  actual results may differ  significantly from
the results  discussed in such  forward-looking  statements.  Factors that might
cause such a difference  include,  but are not limited to, those discussed under
the heading "Business Outlook."

Financing Volume

In the first quarter of fiscal 2002  industry  retail sales of Class 5 through 8
trucks were approximately 18.9% lower than fiscal 2001. The Corporation's retail
financing  acquisitions in fiscal 2002,  including  retail notes and finance and
operating  leases,  were  $210.1  million,  24.1% lower than  fiscal  2001.  The
decrease  was  primarily  due to a  reduction  in  industry  retail  sales.  The
Corporation's  finance market share of new International trucks sold in the U.S.
increased  to 22.8% in the first  quarter of fiscal 2002 from 16.9% in the first
quarter of fiscal 2001. Net serviced retail notes and lease  financing  balances
were  $2,895.8  million  and  $3,256.0  million  at January  31,  2002 and 2001,
respectively.

The Corporation  provided 96.0% of the wholesale financing of new trucks sold to
International's  dealers in the first quarter of fiscal 2002 and 2001.  Serviced
wholesale  note  balances  were  $749.5  million at January  31,  2002,  a 24.4%
decrease  compared to the same period of fiscal 2001.  The decrease is primarily
due to a decrease  in dealer  inventory  levels in  response  to lower  industry
retail sales.

Results of Continuing Operations

Pretax income was $27.2 million and $20.8 million in the first quarter of fiscal
2002 and 2001,  respectively.  The increase was primarily the result of a higher
retail gain on sale of retail note receivables offset, in part, by lower finance
receivables balances.

Retail note  financing  revenue was $28.5 million in the first quarter of fiscal
2002 compared to $21.7 million in the first quarter of fiscal 2001. The increase
is  primarily  the result of a higher gain on sale of retail  note  receivables.
Gains on the  sales of retail  note  receivables  were  $17.2  million  and $9.2
million in the first quarter of fiscal 2002 and 2001, respectively.

<PAGE>

                         NAVISTAR FINANCIAL CORPORATION
                                AND SUBSIDIARIES

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


Results of Continuing Operations (continued)

Lease  financing  revenue was $22.2  million in the first quarter of fiscal 2002
compared to $25.8 million in the first  quarter of fiscal 2001.  The decrease is
primarily the result of lower average lease financing balances.

Wholesale  note  revenue  was $6.5  million in the first  quarter of fiscal 2002
compared to $13.2 million in the first  quarter of fiscal 2001.  The decrease is
primarily a result of lower average serviced wholesale note balances.

Retail and  wholesale  account  revenue was $5.4 million in the first quarter of
fiscal 2002  compared to $8.7 million in the first  quarter of fiscal 2001.  The
decrease is primarily the result of lower average serviced account balances.

Servicing  fee income  was $6.3  million  in the first  quarter  of fiscal  2002
compared to $8.2 million in the first  quarter of fiscal 2001.  The decrease was
primarily the result of lower average sold finance receivables balances.

Marketable  securities  revenue was $3.1 million in the first  quarter of fiscal
2002 compared to $7.7 million in the first quarter of fiscal 2001.  The decrease
was primarily the result of lower average interest rates.

Borrowing  costs  totaled  $16.4  million  for the first  quarter of fiscal 2002
compared with $31.7  million for the first quarter of fiscal 2001  primarily due
to a decrease in the Corporation's weighted average interest rate on all debt to
3.8% in first  quarter of fiscal  2002 from 6.9% in the first  quarter of fiscal
2001.  The  decrease in the  Corporation's  weighted  average  interest  rate is
primarily a result of lower LIBOR rates.

Provision for losses on  receivables  totaled $4.3 million for the first quarter
of fiscal 2002 compared to $6.5 million in the first quarter of fiscal 2001. The
decrease  was  primarily  due  to a  decrease  in  repossession  frequency.  The
Corporation's   allowance  for  losses  as  a  percentage  of  serviced  finance
receivables  was .75%,  .71% and .59% at January 31, 2002,  October 31, 2001 and
January 31, 2001, respectively.

<PAGE>

                         NAVISTAR FINANCIAL CORPORATION
                                AND SUBSIDIARIES

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


Liquidity and Funds Management

The Corporation  has  traditionally  obtained the funds to provide  financing to
International's  dealers and retail customers from sales of finance receivables,
commercial paper, short and long-term bank borrowings, medium and long-term debt
and equity capital.  The  Corporation's  current debt ratings have made sales of
finance receivables the most economical source of funding.

Operations  provided  $110.9  million  in  cash  in the  first  quarter  of 2002
primarily  as a result of the increase of $71.9  million in accounts  payable to
affiliates.  Investing  activities  provided  $109.2 million in cash during this
period  primarily  as a result of the sale of retail notes and the sale of Harco
National Insurance Company, offset by purchases of marketable securities for the
revolving  retail  warehouse  facility  and  purchases of retail notes and lease
receivables.  Financing activities used $197.9 million primarily to decrease the
bank revolving credit facility.

The  Corporation  securitizes  and sells finance  receivables  through  Navistar
Financial  Retail   Receivables   Corporation   ("NFRRC"),   Navistar  Financial
Securities Corporation ("NFSC"),  Truck Retail Accounts Corporation ("TRAC") and
Truck Engine Receivables Financing Corporation ("TERFCO"),  all special purpose,
wholly-owned  subsidiaries of the Corporation.  The sales of finance receivables
in  each  of the  securitizations  constitute  sales  under  generally  accepted
accounting  principles,  with the result that the sold  receivables  are removed
from the Corporation's balance sheet and the investor's interests in the related
trust or conduit are not reflected as liabilities.  However, the special purpose
entity's  residual  interest in the related trusts or assets held by the conduit
are reflected on the Corporation's Statement of Consolidated Financial Condition
as assets.

During the three months  ended  January 31, 2002,  the  Corporation  sold $500.0
million of retail notes,  net of unearned  finance  income,  through NFRRC.  The
Corporation  sold the retail  notes to an owner  trust,  which,  in turn  issued
$500.0 million of asset-backed securities that were sold to investors. Aggregate
gains of $17.2 million were recognized on these sales.

TERFCO provides for funding of $100.0 million eligible Ford accounts receivables
and expires in 2005. As of January 31, 2002 the  Corporation has utilized $100.0
million of this facility.

TRAC has in place an  arrangement  with a bank  conduit  that  provides  for the
funding of $100.0 million of eligible  retail  accounts.  As of January 31, 2002
the  Corporation  has utilized  $100.0  million of this  facility.  The facility
expires in August 2002 with an option for renewal.
<PAGE>




                         NAVISTAR FINANCIAL CORPORATION
                                AND SUBSIDIARIES

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


Liquidity and Funds Management (continued)


At January 31,  2002,  NFSC has in place a revolving  wholesale  note trust that
provides for the funding of $837.0 million of eligible  wholesale  notes.  It is
comprised of three $200.0 million tranches of investor  certificates maturing in
2003, 2004 and 2008, a $212.0 million tranche of investor  certificates maturing
in 2005 and  variable  funding  certificates  with a maximum  capacity  of $25.0
million  maturing in January  2003.  As of January 31,  2001,  NFSC has utilized
$713.4 million of the revolving wholesale note trust.

At January 31, 2002, available funding under the bank revolving credit facility,
the revolving retail warehouse  facility,  the retail account facilities and the
revolving   wholesale  note  trust  was  $959.0  million.   When  combined  with
unrestricted cash and cash equivalents,  $1,003.6 million remained  available to
fund the general business purposes of the Corporation.

Business Outlook

Retail  deliveries of Class 5 through 8 trucks,  including  school buses, in the
U.S. in fiscal 2002 is forecasted to decrease approximately 9% from fiscal 2001.
Increased volatility in the capital markets is likely to put additional pressure
on the funding rates  available to the  Corporation in the  asset-backed  public
market and other debt financing markets.

Management  believes that  collections on the  outstanding  finance  receivables
portfolio plus cash available from the  Corporation's  various  funding  sources
will permit Navistar Financial Corporation to meet the financing requirements of
International's dealers and retail customers through 2002 and beyond.

<PAGE>


                           PART II - OTHER INFORMATION


Item 6.   Exhibits and Reports on Form 8-K


No reports on Form 8-K were filed  during the three  months  ended  January  31,
2002.



                                    SIGNATURE


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.



                                                  Navistar Financial Corporation
                                                          (Registrant)






/s/Ronald D. Markle                                               March 11, 2002
     Ronald D. Markle
     Vice President and Controller                                      Date
     (Principal Accounting Officer)