10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

___________________________________________________

Form 10-Q

___________________________________________________

(Mark One)

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

For the quarterly period ended April 30, 2015

OR

o 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 1-9618

___________________________________________________

NAVISTAR INTERNATIONAL CORPORATION

(Exact name of registrant as specified in its charter)

_______________________________________________

Delaware	36-3359573
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
2701 Navistar Drive, Lisle, Illinois	60532
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code (331) 332-5000

______________________________________________________

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days.    Yes  þ    No  o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  þ    No  o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See definition of "large accelerated filer," "accelerated filer," and "smaller reporting company" in Rule 12b-2 of the Exchange Act. (Check one)

Large accelerated filer	þ	Accelerated filer	o
Non-accelerated filer	o	Smaller reporting company	o
(Do not check if a smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).    Yes  o    No  þ

As of May 31, 2015, the number of shares outstanding of the registrant’s common stock was 81,500,808, net of treasury shares.

NAVISTAR INTERNATIONAL CORPORATION FORM 10-Q

TABLE OF CONTENTS

		Page
PART I—Financial Information
Item 1.	Financial Statements (Unaudited)	5
	Consolidated Statements of Operations for the three and six months ended April 30, 2015 and 2014	6
	Consolidated Statements of Comprehensive Loss for the three and six months ended April 30, 2015 and 2014	7
	Consolidated Balance Sheets as of April 30, 2015 and October 31, 2014	8
	Condensed Consolidated Statements of Cash Flows for the six months ended April 30, 2015 and 2014	9
	Consolidated Statements of Stockholders' Deficit for the six months ended April 30, 2015 and 2014	10
	Notes to Condensed Consolidated Financial Statements	11
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	44
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	58
Item 4.	Controls and Procedures	59
PART II
Item 1.	Legal Proceedings	60
Item 1A.	Risk Factors	60
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	61
Item 3.	Defaults upon Senior Securities	61
Item 4.	Mine Safety Disclosures	61
Item 5.	Other Information	62
Item 6.	Exhibits	62
	Signatures	63

2

Disclosure Regarding Forward-Looking Statements

Information provided and statements contained in this report that are not purely historical are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended ("Securities Act"), Section 21E of the Securities Exchange Act of 1934, as amended ("Exchange Act"), and the Private Securities Litigation Reform Act of 1995. Such forward-looking statements only speak as of the date of this report and Navistar International Corporation assumes no obligation to update the information included in this report.

Such forward-looking statements include, but are not limited to, statements concerning:

• estimates we have made in preparing our financial statements;

• our development of new products and technologies;

• anticipated sales, volume, demand, and markets for our products;

• anticipated performance and benefits of our products and technologies;

• our business strategies relating to, and our ability to meet, federal and state regulatory heavy-duty diesel emissions standards applicable to certain of our engines, including the timing and costs of compliance and consequences of noncompliance with such standards, as well as our ability to meet other federal, state and foreign regulatory requirements;

• our business strategies and long-term goals, and activities to accomplish such strategies and goals;

• our ability to finish the “Drive-to-Deliver” turnaround and implement our new strategy focused on establishing a leading market position based on uptime advantage and developing effective leaders at every level;

• anticipated results from our Return-on-Invested-Capital ("ROIC") methodology and the benchmarking study to create a pathway to achieve profitability;

• anticipated results from the realignment of our leadership and management structure;

• anticipated benefits from acquisitions, strategic alliances, and joint ventures we complete;

• our expectations relating to the termination of our Blue Diamond Truck ("BDT") joint venture with Ford Motor Company ("Ford") in May 2015;

• our expectations and estimates relating to restructuring activities, including restructuring and integration charges and timing of cash payments related thereto, and operational flexibility, savings, and efficiencies from such restructurings;

• our expectations relating to the possible effects of anticipated divestitures and closures of businesses;

• our expectations relating to our cost-reduction actions, including our enterprise-wide reduction-in-force, and other actions to reduce discretionary spending;

• our expectations relating to our ability to service our long-term debt;

• our expectations relating to our retail finance receivables and retail finance revenues;

• our anticipated costs relating to the implementation of our emissions compliance strategy and other product modifications that may be required to meet other federal, state, and foreign regulatory requirements;

• liabilities resulting from environmental, health and safety laws and regulations;

• our anticipated capital expenditures;

• our expectations relating to payments of taxes;

• our expectations relating to warranty costs;

• our expectations relating to interest expense;

• our expectations relating to impairment of goodwill and other assets;

• costs relating to litigation and similar matters;

• estimates relating to pension plan contributions and unfunded pension and postretirement benefits;

• trends relating to commodity prices; and

• anticipated trends, expectations, and outlook relating to matters affecting our financial condition or results of operations.

These statements often include words such as "believe," "expect," "anticipate," "intend," "plan," "estimate," or similar expressions. These statements are not guarantees of performance or results and they involve risks, uncertainties, and assumptions. Although we believe that these forward-looking statements are based on reasonable assumptions, there are many factors that could affect our actual financial results or results of operations and could cause actual results to differ materially from those in the forward-looking statements. Factors that could cause or contribute to differences in our future financial results include those discussed in Item 1A, Risk Factors, included within our Annual Report on Form 10-K for the year ended October 31, 2014, which was filed on December 16, 2014, as well as those discussed elsewhere in this report. All future written and oral forward-looking statements by us or persons acting on our behalf are expressly qualified in their entirety by the cautionary statements contained herein or referred to above. Except for our ongoing obligations to disclose material information as required by the federal securities laws, we do not have any obligations or intention to release publicly any revisions to any forward-looking statements to reflect events or circumstances in the future or to reflect the occurrence of unanticipated events.

3

Available Information

We are subject to the reporting and information requirements of the Exchange Act and as a result, are obligated to file annual, quarterly, and current reports, proxy statements, and other information with the United States ("U.S.") Securities and Exchange Commission ("SEC"). We make these filings available free of charge on our website (http://www.navistar.com) as soon as reasonably practicable after we electronically file them with, or furnish them to, the SEC. Information on our website does not constitute part of this Quarterly Report on Form 10-Q. In addition, the SEC maintains a website (http://www.sec.gov) that contains our annual, quarterly, and current reports, proxy and information statements, and other information we electronically file with, or furnish to, the SEC. Any materials we file with, or furnish to, the SEC may also be read and/or copied at the SEC’s Public Reference Room at 100 F Street, N.E., Washington, D.C. 20549. Information on the operation of the Public Reference Room may be obtained by calling the SEC at 1-800-SEC-0330.

4

PART I—Financial Information

Item 1. Financial Statements

See Notes to Condensed Consolidated Financial Statements

5

Navistar International Corporation and Subsidiaries

Consolidated Statements of Operations

(Unaudited)

	Three Months Ended April 30,						Six Months Ended April 30,
(in millions, except per share data)	2015			2014			2015			2014
Sales and revenues
Sales of manufactured products, net	$	2,658		$	2,708		$	5,043		$	4,877
Finance revenues	35			38			71			77
Sales and revenues, net	2,693			2,746			5,114			4,954
Costs and expenses
Costs of products sold	2,360			2,468			4,405			4,482
Restructuring charges	6			8			9			11
Asset impairment charges	1			151			8			169
Selling, general and administrative expenses	243			237			484			476
Engineering and product development costs	76			83			155			173
Interest expense	75			74			152			156
Other (income) expense, net	(28		)	(8		)	(31		)	6
Total costs and expenses	2,733			3,013			5,182			5,473
Equity in income of non-consolidated affiliates	1			3			3			3
Loss from continuing operations before income taxes	(39		)	(264		)	(65		)	(516		)
Income tax expense	(18		)	(23		)	(25		)	(11		)
Loss from continuing operations	(57		)	(287		)	(90		)	(527		)
Income from discontinued operations, net of tax	—			1			—			2
Net loss	(57		)	(286		)	(90		)	(525		)
Less: Net income attributable to non-controlling interests	7			11			16			20
Net loss attributable to Navistar International Corporation	$	(64	)	$	(297	)	$	(106	)	$	(545	)
Amounts attributable to Navistar International Corporation common shareholders:
Loss from continuing operations, net of tax	$	(64	)	$	(298	)	$	(106	)	$	(547	)
Income from discontinued operations, net of tax	—			1			—			2
Net loss	$	(64	)	$	(297	)	$	(106	)	$	(545	)
Earnings (loss) per share:
Basic:
Continuing operations	$	(0.78	)	$	(3.66	)	$	(1.30	)	$	(6.73	)
Discontinued operations	—			0.01			—			0.03
	$	(0.78	)	$	(3.65	)	$	(1.30	)	$	(6.70	)
Diluted:
Continuing operations	$	(0.78	)	$	(3.66	)	$	(1.30	)	$	(6.73	)
Discontinued operations	—			0.01			—			0.03
	$	(0.78	)	$	(3.65	)	$	(1.30	)	$	(6.70	)
Weighted average shares outstanding:
Basic	81.6			81.4			81.5			81.3
Diluted	81.6			81.4			81.5			81.3

See Notes to Condensed Consolidated Financial Statements

6

Navistar International Corporation and Subsidiaries

Consolidated Statements of Comprehensive Loss

(Unaudited)

(in millions)	Three Months Ended April 30,						Six Months Ended April 30,
	2015			2014			2015			2014
Net loss attributable to Navistar International Corporation	$	(64	)	$	(297	)	$	(106	)	$	(545	)
Other comprehensive income (loss):
Foreign currency translation adjustment	(27		)	48			(86		)	(14		)
Defined benefit plans (net of tax of $0, $0, $(1), $(1), respectively)	33			25			65			50
Total other comprehensive income (loss)	6			73			(21		)	36
Total comprehensive loss attributable to Navistar International Corporation	$	(58	)	$	(224	)	$	(127	)	$	(509	)

See Notes to Condensed Consolidated Financial Statements

7

Navistar International Corporation and Subsidiaries

Consolidated Balance Sheets

	April 30, 2015			October 31, 2014
(in millions, except per share data)
ASSETS	(Unaudited)
Current assets
Cash and cash equivalents	$	583		$	497
Restricted cash and cash equivalents	—			40
Marketable securities	273			605
Trade and other receivables, net	502			553
Finance receivables, net	1,929			1,758
Inventories	1,245			1,319
Deferred taxes, net	38			55
Other current assets	206			186
Total current assets	4,776			5,013
Restricted cash	113			131
Trade and other receivables, net	18			25
Finance receivables, net	225			280
Investments in non-consolidated affiliates	68			73
Property and equipment (net of accumulated depreciation and amortization of $2,590 and $2,535, respectively)	1,407			1,562
Goodwill	38			38
Intangible assets (net of accumulated amortization of $113 and $109, respectively)	74			90
Deferred taxes, net	134			145
Other noncurrent assets	72			86
Total assets	$	6,925		$	7,443
LIABILITIES and STOCKHOLDERS’ DEFICIT
Liabilities
Current liabilities
Notes payable and current maturities of long-term debt	$	1,211		$	1,295
Accounts payable	1,450			1,564
Other current liabilities	1,345			1,372
Total current liabilities	4,006			4,231
Long-term debt	3,992			3,929
Postretirement benefits liabilities	2,770			2,862
Deferred taxes, net	14			14
Other noncurrent liabilities	887			1,025
Total liabilities	11,669			12,061
Redeemable equity securities	1			2
Stockholders’ deficit
Series D convertible junior preference stock	3			3
Common stock (86.8 shares issued, and $0.10 par value per share and 220 shares authorized, all at both dates)	9			9
Additional paid-in capital	2,498			2,500
Accumulated deficit	(4,788		)	(4,682		)
Accumulated other comprehensive loss	(2,284		)	(2,263		)
Common stock held in treasury, at cost (5.3 and 5.4 shares, respectively)	(213		)	(221		)
Total stockholders’ deficit attributable to Navistar International Corporation	(4,775		)	(4,654		)
Stockholders’ equity attributable to non-controlling interests	30			34
Total stockholders’ deficit	(4,745		)	(4,620		)
Total liabilities and stockholders’ deficit	$	6,925		$	7,443

See Notes to Condensed Consolidated Financial Statements

8

Navistar International Corporation and Subsidiaries

Condensed Consolidated Statements of Cash Flows

(Unaudited)

	Six Months Ended April 30,
(in millions)	2015			2014
Cash flows from operating activities
Net loss	$	(90	)	$	(525	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	118			122
Depreciation of equipment leased to others	35			63
Deferred taxes, including change in valuation allowance	(7		)	(2		)
Asset impairment charges	8			169
Amortization of debt issuance costs and discount	19			27
Stock-based compensation	8			12
Provision for doubtful accounts, net of recoveries	(3		)	9
Equity in income of non-consolidated affiliates, net of dividends	5			7
Write-off of debt issuance cost and discount	—			1
Other non-cash operating activities	(20		)	(15		)
Changes in other assets and liabilities, exclusive of the effects of businesses disposed	(310		)	(194		)
Net cash used in operating activities	(237		)	(326		)
Cash flows from investing activities
Purchases of marketable securities	(162		)	(788		)
Sales of marketable securities	431			902
Maturities of marketable securities	63			182
Net change in restricted cash and cash equivalents	53			(21		)
Capital expenditures	(45		)	(50		)
Purchases of equipment leased to others	(20		)	(108		)
Proceeds from sales of property and equipment	5			20
Proceeds from sales of affiliates	7			5
Net cash provided by investing activities	332			142
Cash flows from financing activities
Proceeds from issuance of securitized debt	250			152
Principal payments on securitized debt	(169		)	(81		)
Proceeds from issuance of non-securitized debt	84			473
Principal payments on non-securitized debt	(146		)	(509		)
Net increase in notes and debt outstanding under revolving credit facilities	5			3
Principal payments under financing arrangements and capital lease obligations	(1		)	(14		)
Debt issuance costs	(7		)	(13		)
Proceeds from financed lease obligations	20			34
Proceeds from exercise of stock options	1			18
Dividends paid by subsidiaries to non-controlling interest	(20		)	(30		)
Net cash provided by financing activities	17			33
Effect of exchange rate changes on cash and cash equivalents	(26		)	(10		)
Increase (decrease) in cash and cash equivalents	86			(161		)
Cash and cash equivalents at beginning of the period	497			755
Cash and cash equivalents at end of the period	$	583		$	594

See Notes to Condensed Consolidated Financial Statements

9

Navistar International Corporation and Subsidiaries

Consolidated Statements of Stockholders’ Deficit

(Unaudited)

(in millions)	Series D Convertible Junior Preference Stock		Common Stock		Additional Paid-in Capital			Accumulated Deficit			Accumulated Other Comprehensive Income (Loss)			Common Stock Held in Treasury, at cost			Stockholders' Equity Attributable to Non-controlling Interests			Total
Balance as of October 31, 2014	$	3	$	9	$	2,500		$	(4,682	)	$	(2,263	)	$	(221	)	$	34		$	(4,620	)
Net income (loss)	—		—		—			(106		)	—			—			16			(90		)
Total other comprehensive loss	—		—		—			—			(21		)	—			—			(21		)
Transfer from redeemable equity securities upon exercise or expiration of stock options	—		—		1			—			—			—			—			1
Stock-based compensation	—		—		6			—			—			—			—			6
Stock ownership programs	—		—		(9		)	—			—			8			—			(1		)
Cash dividends paid to non-controlling interest	—		—		—			—			—			—			(20		)	(20		)
Balance as of April 30, 2015	$	3	$	9	$	2,498		$	(4,788	)	$	(2,284	)	$	(213	)	$	30		$	(4,745	)
Balance as of October 31, 2013	3		9		2,477			(4,063		)	(1,824		)	(251		)	44			(3,605		)
Net income (loss)	—		—		—			(545		)	—			—			20			(525		)
Total other comprehensive income	—		—		—			—			36			—			—			36
Transfer from redeemable equity securities upon exercise or expiration of stock options	—		—		2			—			—			—			—			2
Stock-based compensation	—		—		9			—			—			—			—			9
Stock ownership programs	—		—		(8		)	—			—			25			—			17
Equity component of convertible debt instruments, net of tax expense of $16	—		—		27			—			—			—			—			27
Equity component of repurchased convertible debt instruments, net of tax benefit of $3	—		—		(5		)	—			—			—			—			(5		)
Cash dividends paid to non-controlling interest	—		—		—			—			—			—			(30		)	(30		)
Balance as of April 30, 2014	$	3	$	9	$	2,502		$	(4,608	)	$	(1,788	)	$	(226	)	$	34		$	(4,074	)

See Notes to Condensed Consolidated Financial Statements

10

Navistar International Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements

(Unaudited)

1. Summary of Significant Accounting Policies

Organization and Description of the Business

Navistar International Corporation ("NIC"), incorporated under the laws of the State of Delaware in 1993, is a holding company whose principal operating entities are Navistar, Inc. and Navistar Financial Corporation ("NFC"). References herein to the "Company," "we," "our," or "us" refer collectively to NIC and its consolidated subsidiaries, including certain variable interest entities ("VIEs") of which we are the primary beneficiary. We operate in four principal industry segments: Truck, Parts, Global Operations (collectively called "Manufacturing operations"), and Financial Services, which consists of NFC and our foreign finance operations (collectively called "Financial Services operations"). These segments are discussed in Note 12, Segment Reporting.

Our fiscal year ends on October 31. As such, all references to 2015 and 2014 contained within this Quarterly Report on Form 10-Q relate to the fiscal year, unless otherwise indicated.

Basis of Presentation and Consolidation

The accompanying unaudited consolidated financial statements include the assets, liabilities, and results of operations of our Manufacturing operations, which include majority-owned dealers ("Dealcors"), and our Financial Services operations, including VIEs of which we are the primary beneficiary. The effects of transactions among consolidated entities have been eliminated to arrive at the consolidated amounts.

Certain reclassifications were made to prior period amounts to conform to the 2015 presentation, which relate to the realignment of our reporting segments that became effective during the first quarter of 2015. For more information, see Note 12, Segment Reporting.

We prepared the accompanying unaudited consolidated financial statements in accordance with United States ("U.S.") generally accepted accounting principles ("U.S. GAAP") for interim financial information and the instructions to the Quarterly Report on Form 10-Q and Article 10 of Regulation S-X issued by the U.S. Securities and Exchange Commission ("SEC"). Accordingly, they do not include all of the information and notes required by U.S. GAAP for comprehensive annual financial statements.

The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting policies described in our Annual Report on Form 10-K for the year ended October 31, 2014, which should be read in conjunction with the disclosures therein. In our opinion, these interim consolidated financial statements reflect all adjustments, consisting of normal recurring adjustments, necessary to present fairly the financial condition, results of operations, and cash flows for the periods presented. Operating results for interim periods are not necessarily indicative of annual operating results.

Variable Interest Entities

We have an interest in several VIEs, primarily joint ventures, established to manufacture or distribute products and enhance our operational capabilities. We have determined for certain of our VIEs that we are the primary beneficiary because we have the power to direct the activities of the VIE that most significantly impact its economic performance and we have the obligation to absorb losses of, or the right to receive benefits from, the VIE that could potentially be significant to the VIE. Accordingly, we include in our consolidated financial statements the assets and liabilities and results of operations of those entities, even though we may not own a majority voting interest. The liabilities recognized as a result of consolidating these VIEs do not represent additional claims on our general assets; rather they represent claims against the specific assets of these VIEs. Assets of these entities are not readily available to satisfy claims against our general assets.

We are the primary beneficiary of our Blue Diamond Parts ("BDP") and Blue Diamond Truck ("BDT") joint ventures with Ford. As a result, our Consolidated Balance Sheets include assets of $263 million and $297 million and liabilities of $238 million and $250 million as of April 30, 2015 and October 31, 2014, respectively, from BDP and BDT, including $87 million and $77 million of cash and cash equivalents, at the respective dates, which are not readily available to satisfy claims against our general assets. The creditors of BDP and BDT do not have recourse to our general credit. On May 29, 2015, we acquired Ford's remaining 25% ownership in BDT. The termination of the BDT joint venture did not have a material impact on our consolidated financial statements.

Our Financial Services segment consolidates several VIEs. As a result, our Consolidated Balance Sheets include secured assets of $1.2 billion and $1.1 billion as of April 30, 2015 and October 31, 2014, respectively, and liabilities of $923 million and $896 million as of April 30, 2015 and October 31, 2014, respectively, all of which are involved in securitizations that are treated as asset-backed debt. In addition, our Consolidated Balance Sheets include secured assets of $213 million and $156 million and

11

Navistar International Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements—(Continued)

(Unaudited)

corresponding liabilities of $92 million and $54 million as of April 30, 2015 and October 31, 2014, respectively, which are related to other secured transactions that do not qualify for sale accounting treatment, and therefore, are treated as borrowings secured by operating and finance leases. Investors that hold securitization debt have a priority claim on the cash flows generated by their respective securitized assets to the extent that the related VIEs are required to make principal and interest payments. Investors in securitizations of these entities have no recourse to our general credit.

We also have an interest in other VIEs, which we do not consolidate because we are not the primary beneficiary. Our financial support and maximum loss exposure relating to these non-consolidated VIEs are not material to our financial condition, results of operations, or cash flows.

We use the equity method to account for our investments in entities that we do not control under the voting interest or variable interest models, but where we have the ability to exercise significant influence over operating and financial policies. Equity in income of non-consolidated affiliates includes our share of the net income of these entities.

Product Warranty Liability

The following table presents accrued product warranty and deferred warranty revenue activity:

	Six Months Ended April 30,
(in millions)	2015			2014
Balance at beginning of period	$	1,197		$	1,349
Costs accrued and revenues deferred	116			153
Currency translation adjustment	(5		)	(1		)
Adjustments to pre-existing warranties(A)	(39		)	94
Payments and revenues recognized	(210		)	(272		)
Balance at end of period	1,059			1,323
Less: Current portion	496			626
Noncurrent accrued product warranty and deferred warranty revenue	$	563		$	697

_________________________

(A) Adjustments to pre-existing warranties reflect changes in our estimate of warranty costs for products sold in prior periods. Such adjustments typically occur when claims experience deviates from historic and expected trends. Our warranty liability is generally affected by component failure rates, repair costs, and the timing of failures. Future events and circumstances related to these factors could materially change our estimates and require adjustments to our liability. In addition, new product launches require a greater use of judgment in developing estimates until historical experience becomes available.

In the first quarter of 2015, we recognized a benefit for adjustments to pre-existing warranties of $57 million or a benefit of $0.70 per diluted share. Inthe first quarter of 2014, we recorded adjustments for changes in estimates of $52 million or charges of $0.64 per diluted share. In the second quarter of 2014, we recorded adjustments for changes in estimates of $42 million, or charges of $0.52 per diluted share. The impact of income taxes on the 2015 and 2014 adjustments are not material due to our deferred tax valuation allowances on our U.S. deferred tax assets.

Extended Warranty Programs

The amount of deferred revenue related to extended warranty programs was $425 million and $437 million at April 30, 2015 and October 31, 2014, respectively. Revenue recognized under our extended warranty programs was $38 million and $75 million, in the three and six months ended April 30, 2015, respectively, and $33 million and $60 million for the three and six months ended April 30, 2014, respectively.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses for the periods presented. Significant estimates and assumptions are used for, but are not limited to, pension and other postretirement benefits, allowance for doubtful accounts, income tax contingency accruals and valuation allowances, product warranty accruals, asbestos and other product liability accruals, asset impairment charges, and litigation-related accruals. Actual results could differ from our estimates.

Concentration Risks

Our financial condition, results of operations, and cash flows are subject to concentration risks related to concentrations of our union employees. As of April 30, 2015, approximately 6,200, or 73%, of our hourly workers and approximately 300, or 5%, of our salaried workers are represented by labor unions and are covered by collective bargaining agreements. On February 9, 2015, our United Automobile, Aerospace, and Agricultural Implement Workers of America ("UAW") represented employees ratified a new four-year labor agreement that replaced the prior contract that expired October 1, 2014. Our future operations

12

Navistar International Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements—(Continued)

(Unaudited)

may be affected by changes in governmental procurement policies, budget considerations, changing national defense requirements, and global, political, regulatory and economic developments in the U.S. and certain foreign countries (primarily Canada, Mexico, and Brazil).

Goodwill and Indefinite-Lived Intangible Assets

Goodwill represents the excess of the cost of an acquired business over the amounts assigned to the net assets. Goodwill is not amortized but is tested for impairment at a reporting unit level on an annual basis or more frequently, if circumstances change or an event occurs that would more likely than not reduce the fair value of a reporting unit below its carrying amount. Qualitative factors may be assessed to determine whether it is more likely than not that the fair value of the reporting unit is less than its carrying amount. If the qualitative assessment indicates that the carrying amount is more likely than not higher than the fair value, goodwill is tested for impairment based on a two-step test. The first step compares the fair value of a reporting unit with its carrying amount, including goodwill. If the fair value of a reporting unit exceeds its carrying amount, goodwill of the reporting unit is considered not impaired, thus the second step of the impairment test is unnecessary. If the carrying amount of a reporting unit exceeds its fair value, the second step of the goodwill impairment test shall be performed to measure the amount of impairment loss, if any. The second step compares the implied fair value of reporting unit goodwill with the carrying amount of that goodwill. If the carrying amount of reporting unit goodwill exceeds the implied fair value of that goodwill, an impairment loss shall be recognized in an amount equal to that excess.

Significant judgment is applied when goodwill is assessed for impairment. This judgment includes developing cash flow projections, selecting appropriate discount rates, identifying relevant market comparables, incorporating general economic and market conditions, and selecting an appropriate control premium. The income approach is based on discounted cash flows which are derived from internal forecasts and economic expectations for each respective reporting unit.

An intangible asset determined to have an indefinite useful life is not amortized until its useful life is determined to no longer be indefinite. Indefinite-lived intangible assets are evaluated each reporting period to determine whether events and circumstances continue to support an indefinite useful life. Indefinite-lived intangible assets are tested for impairment annually or more frequently if events or changes in circumstances indicate that the asset might be impaired. The impairment test consists of a comparison of the fair value of the indefinite-lived intangible asset with its carrying amount. If the carrying amount of an indefinite-lived intangible asset exceeds its fair value, an impairment loss is recognized in an amount equal to that excess.

Significant judgment is applied when evaluating if an intangible asset has a finite useful life. In addition, for indefinite-lived intangible assets, significant judgment is applied in testing for impairment. This judgment includes developing cash flow projections, selecting appropriate discount rates, identifying relevant market comparables, and incorporating general economic and market conditions. 

During the second quarter of 2014, the economic downturn in Brazil resulted in the continued decline in actual and forecasted results for the Brazilian engine reporting unit with goodwill of $142 million and an indefinite-lived intangible asset, trademark, of $43 million. As a result, we performed an impairment analysis in the second quarter of 2014 utilizing the income approach, based on discounted cash flows, which are derived from internal forecasts and economic expectations. It was determined that the carrying value of the Brazilian engine reporting unit, including goodwill, exceeded its fair value. As a result we compared the implied fair value of the reporting unit's goodwill with the carrying amount of that goodwill. A decrease in the enterprise value of the reporting unit coupled with appreciation in the value of certain tangible assets, which are not recognized for accounting purposes, resulted in the determination that the entire $142 million of goodwill was impaired. In addition, we determined that the related trademark was impaired and recognized an impairment charge of $7 million. The non-cash impairment charges were included in Asset impairment charges in the Company's Consolidated Statements of Operations. The Brazilian engine reporting unit is included in the Global Operations segment.

Recently Adopted Accounting Standards

In the six months ended April 30, 2015, the Company has not adopted any new accounting guidance that has had a material impact on our consolidated financial statements.

Recently Issued Accounting Standards

In May 2014, the Financial Accounting Standards Board ("FASB") issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606), which supersedes the revenue recognition requirements in ASC 605, Revenue Recognition. This ASU is based on the principle that revenue is recognized to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The ASU also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or

13

Navistar International Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements—(Continued)

(Unaudited)

fulfill a contract. This new guidance is effective for annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period. Early adoption is not permitted. Our effective date is November 1, 2017. On April 29, 2015 the FASB issued an exposure draft of a proposed ASU that would delay by one year the effective date of ASU 2014-09 and allow early adoption as of the original effective date. The changes to the effective date and early adoption are still subject to final approval. We are currently evaluating the impact and method of adoption of this ASU on our consolidated financial statements.

2. Restructurings and Impairments

Restructuring charges are recorded based on restructuring plans that have been committed to by management and are, in part, based upon management's best estimates of future events. Changes to the estimates may require future adjustments to the restructuring liabilities.

Restructuring Liability

The following tables summarize the activity in the restructuring liability, which includes amounts related to discontinued operations and excludes pension and other postretirement contractual termination benefits:

(in millions)	Balance at October 31, 2014		Additions		Payments			Adjustments			Balance at April 30, 2015
Employee termination charges	$	8	$	7	$	(4	)	$	(1	)	$	10
Lease vacancy	11		—		(4		)	—			7
Other	1		—		—			—			1
Restructuring liability	$	20	$	7	$	(8	)	$	(1	)	$	18

(in millions)	Balance at October 31, 2013		Additions		Payments			Adjustments		Balance at April 30, 2014
Employee termination charges	$	15	$	9	$	(8	)	$	—	$	16
Employee relocation costs	—		1		(1		)	—		—
Lease vacancy	18		1		(4		)	—		15
Other	1		—		(2		)	—		(1		)
Restructuring liability	$	34	$	11	$	(15	)	$	—	$	30

North American Manufacturing Restructuring Activities

We continue to focus on improving our core North American Truck and Parts businesses. We continue to evaluate our portfolio of assets, with the purpose of closing or divesting non-core/non-strategic businesses, and identifying opportunities to restructure our business and rationalize our Manufacturing operations in an effort to optimize our cost structure. The Company is currently evaluating its portfolio of assets to validate their strategic and financial fit. To allow us to increase our focus on our North America core businesses, we are evaluating product lines, businesses, and engineering programs that fall outside of our core businesses. We are using a Return-On-Invested-Capital ("ROIC") methodology, combined with an assessment of the strategic fit to our core businesses, to identify areas that are not performing to our expectations. For those areas, we are evaluating whether to fix, divest, or close. These actions could result in additional restructuring and other related charges in the future, including but not limited to: (i) impairments, (ii) costs for employee and contractor termination and other related benefits, and (iii) charges for pension and other postretirement contractual benefits and curtailments. These charges could be significant.

Chatham restructuring activities

In the third quarter of 2011, the Company committed to close its Chatham, Ontario heavy truck plant, which had been idled since June 2009. Potential additional charges in future periods could range from $0 million to $60 million, primarily related to pension, postretirement costs and termination benefits, which are subject to employee negotiation, acceptance rates and the resolution of disputes related thereto.

Foundry Facilities

In December 2014, we announced the closure of our Indianapolis, Indiana foundry facility, and on April 30, 2015, we sold our Waukesha, Wisconsin foundry operations. As a result of these actions, the Truck segment recognized charges of $13 million and $12 million in the first and second quarter of 2015, respectively, for the acceleration of depreciation of certain assets related to the foundry facilities. These charges are reported within Costs of products sold in the Company's Consolidated Statements of Operations. We expect to incur the remaining accelerated depreciation charges in the third quarter of 2015.

14

Navistar International Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements—(Continued)

(Unaudited)

Cost-Reductions and Other Strategic Initiatives

From time to time, we have announced, and we may continue to announce, actions to control spending across the Company with targeted reductions of certain costs. We are focused on continued reductions in discretionary spending, including reductions resulting from efficiencies, and prioritizing or eliminating certain programs or projects.

In the second quarter of 2014, the Company initiated new cost-reduction actions, including an enterprise-wide reduction-in-force. As a result of these actions, the Company recognized restructuring charges of $8 million in personnel costs for employee termination and related benefits, the majority of which was paid during 2014. The Company expects the remaining restructuring charges will be paid throughout 2015.

Asset Impairments

The following table reconciles our impairment charges in our Consolidated Statements of Operations

	Three Months Ended April 30,				Six Months Ended April 30,
(in millions)	2015		2014		2015		2014
Goodwill impairment charge	$	—	$	142	$	—	$	142
Intangible asset impairment charge	—		7		—		7
Other asset impairment charges related to continuing operations	1		2		8		20
Total asset impairment charges	$	1	$	151	$	8	$	169

In the first quarter of 2015, the Company concluded it had a triggering event related to certain operating leases. As a result, the Truck segment recorded $7 million of asset impairment charges, which are recognized in Asset impairment charges in the Company's Consolidated Statements of Operations. 

In the second quarter of 2014, we recognized a total non-cash charge of $149 million for the impairment of certain intangible assets of our Brazilian engine reporting unit. As a result of the economic downturn in Brazil causing declines in actual and forecasted results, we tested the goodwill and indefinite-lived intangible asset of our Brazilian engine reporting unit for potential impairment. As a result, we determined that the entire $142 million balance of goodwill and $7 million of trademarks were impaired. For more information, see Note 1, Summary of Significant Accounting Policies.

In the first quarter of 2014, the Company concluded it had a triggering event related to potential sales of assets requiring assessment of impairment for certain intangible and long-lived assets in the Truck segment. As a result, certain amortizing intangible assets and long-lived assets were determined to be fully impaired, resulting in an impairment charge of $19 million that was recognized in the six months ended April 30, 2014 in Asset impairment charges in the Company's Consolidated Statements of Operations. 

3. Finance Receivables

Finance receivables are receivables of our Financial Services operations. Finance receivables generally consist of wholesale notes and accounts, as well as retail notes, finance leases and accounts. Total finance receivables reported on the Consolidated Balance Sheets are net of an allowance for doubtful accounts. Total assets of our Financial Services operations net of intercompany balances were $2.6 billion as of both April 30, 2015 and October 31, 2014. Included in total assets of our Financial Services operations are finance receivables of $2.2 billion and $2.0 billion as of April 30, 2015 and October 31, 2014, respectively. We have two portfolio segments of finance receivables based on the type of financing inherent to each portfolio. The retail portfolio segment represents loans or leases to end-users for the purchase or lease of vehicles. The wholesale portfolio segment represents loans to dealers to finance their inventory.

15

Navistar International Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements—(Continued)

(Unaudited)

Our Finance receivables, net consist of the following:

(in millions)	April 30, 2015		October 31, 2014
Retail portfolio	$	667	$	726
Wholesale portfolio	1,515		1,339
Total finance receivables	2,182		2,065
Less: Allowance for doubtful accounts	28		27
Total finance receivables, net	2,154		2,038
Less: Current portion, net(A)	1,929		1,758
Noncurrent portion, net	$	225	$	280

_________________________

(A) The current portion of finance receivables is computed based on contractual maturities. Actual cash collections typically vary from the contractual cash flows because of prepayments, extensions, delinquencies, credit losses, and renewals.

Securitizations

Our Financial Services operations transfers wholesale notes, retail accounts receivable, retail notes, finance leases, and operating leases through special purpose entities ("SPEs"), which generally are only permitted to purchase these assets, issue asset-backed securities, and make payments on the securities. In addition to servicing receivables, our continued involvement in the SPEs may include an economic interest in the transferred receivables and, in some cases, managing exposure to interest rates using interest rate swaps and interest rate caps. There were no transfers of finance receivables that qualified for sale accounting treatment as of April 30, 2015 and October 31, 2014, and as a result, the transferred finance receivables are included in our Consolidated Balance Sheets and the related interest earned is included in Finance revenues.

We transfer eligible finance receivables into retail note owner trusts or wholesale note owner trusts in order to issue asset-backed securities. These trusts are VIEs of which we are determined to be the primary beneficiary and, therefore, the assets and liabilities of the trusts are included in our Consolidated Balance Sheets. The outstanding balance of finance receivables transferred into these VIEs was $1.1 billion and $996 million as of April 30, 2015 and October 31, 2014, respectively. Other finance receivables related to secured transactions that do not qualify for sale accounting treatment were $149 million and $93 million as of April 30, 2015 and October 31, 2014, respectively. For more information on assets and liabilities of consolidated VIEs and other securitizations accounted for as secured borrowings by our Financial Services segment, see Note 1, Summary of Significant Accounting Policies.

Finance Revenues

The following table presents the components of our Finance revenues:

	Three Months Ended April 30,						Six Months Ended April 30,
(in millions)	2015			2014			2015			2014
Retail notes and finance leases revenue	$	12		$	16		$	25		$	33
Wholesale notes interest	24			19			48			37
Operating lease revenue	15			15			30			29
Retail and wholesale accounts interest	9			7			17			13
Gross finance revenues	60			57			120			112
Less: Intercompany revenues	(25		)	(19		)	(49		)	(35		)
Finance revenues	$	35		$	38		$	71		$	77

16

Navistar International Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements—(Continued)

(Unaudited)

4. Allowance for Doubtful Accounts

Our two finance receivables portfolio segments, retail and wholesale, each consist of one class of receivable based on: (i) initial measurement attributes of the receivables, and (ii) the assessment and monitoring of risk and performance of the receivables. For more information, see Note 3, Finance Receivables.

The following tables present the activity related to our allowance for doubtful accounts for our retail portfolio segment, wholesale portfolio segment, and trade and other receivables:

	Three Months Ended April 30, 2015											Three Months Ended April 30, 2014
(in millions)	Retail Portfolio			Wholesale Portfolio		Trade and Other Receivables			Total			Retail Portfolio			Wholesale Portfolio		Trade and Other Receivables			Total
Allowance for doubtful accounts, at beginning of period	$	23		$	3	$	32		$	58		$	22		$	2	$	36		$	60
Provision for doubtful accounts, net of recoveries	3			—		—			3			3			—		1			4
Charge-off of accounts(A)	—			—		—			—			(3		)	—		(2		)	(5		)
Other(B)	(1		)	—		(2		)	(3		)	—			—		3			3
Allowance for doubtful accounts, at end of period	$	25		$	3	$	30		$	58		$	22		$	2	$	38		$	62

	Six Months Ended April 30, 2015											Six Months Ended April 30, 2014
(in millions)	Retail Portfolio			Wholesale Portfolio		Trade and Other Receivables			Total			Retail Portfolio			Wholesale Portfolio		Trade and Other Receivables			Total
Allowance for doubtful accounts, at beginning of period	$	24		$	3	$	38		$	65		$	21		$	2	$	37		$	60
Provision for doubtful accounts, net of recoveries	5			—		—			5			7			—		3			10
Charge-off of accounts(A)	(1		)	—		(3		)	(4		)	(5		)	—		(2		)	(7		)
Other(B)	(3		)	—		(5		)	(8		)	(1		)	—		—			(1		)
Allowance for doubtful accounts, at end of period	$	25		$	3	$	30		$	58		$	22		$	2	$	38		$	62

________________________

(A) We repossess sold and leased vehicles on defaulted finance receivables and leases, and place them into Inventories. Losses recognized at the time of repossession and charged against the allowance for doubtful accounts were both less than $1 million, for the three and six months ended April 30, 2015, as well as for the three and six months ended April 30, 2014.

(B) Amounts include currency translation.

The accrual of interest income is discontinued on certain impaired finance receivables. Impaired finance receivables include accounts with specific loss reserves and certain accounts that are on non-accrual status. In certain cases, we continue to collect payments on our impaired finance receivables.

The following table presents information regarding impaired finance receivables:

	April 30, 2015						October 31, 2014
(in millions)	Retail Portfolio		Wholesale Portfolio		Total		Retail Portfolio		Wholesale Portfolio		Total
Impaired finance receivables with specific loss reserves	$	20	$	—	$	20	$	20	$	—	$	20
Impaired finance receivables without specific loss reserves	7		—		7		1		—		1
Specific loss reserves on impaired finance receivables	9		—		9		6		—		6
Finance receivables on non-accrual status	27		—		27		21		—		21

For the impaired finance receivables in the retail portfolio as of April 30, 2015 and 2014, the average balances of those receivables were $25 million and $16 million during the six months ended April 30, 2015 and 2014, respectively.

17

Navistar International Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements—(Continued)

(Unaudited)

The Company uses the aging of its receivables as well as other inputs when assessing credit quality. The following table presents the aging analysis for finance receivables:

	April 30, 2015						October 31, 2014
(in millions)	Retail Portfolio		Wholesale Portfolio		Total		Retail Portfolio		Wholesale Portfolio		Total
Current, and up to 30 days past due	$	586	$	1,515	$	2,101	$	643	$	1,333	$	1,976
30-90 days past due	57		—		57		64		2		66
Over 90 days past due	24		—		24		19		4		23
Total finance receivables	$	667	$	1,515	$	2,182	$	726	$	1,339	$	2,065

5. Inventories

The following table presents the components of Inventories:

(in millions)	April 30, 2015		October 31, 2014
Finished products	$	797	$	880
Work in process	85		50
Raw materials	363		389
Total inventories	$	1,245	$	1,319

6. Debt

(in millions)	April 30, 2015		October 31, 2014
Manufacturing operations
Senior Secured Term Loan Credit Facility, as amended, due 2017, net of unamortized discount of $3, at both dates	$	694	$	694
8.25% Senior Notes, due 2021, net of unamortized discount of $19 and $20, respectively	1,181		1,180
4.50% Senior Subordinated Convertible Notes, due 2018, net of unamortized discount of $17 and $19, respectively	183		181
4.75% Senior Subordinated Convertible Notes, due 2019, net of unamortized discount of $36 and $40, respectively	375		371
Debt of majority-owned dealerships	28		30
Financing arrangements and capital lease obligations	50		54
Loan Agreement related to 6.5% Tax Exempt Bonds, due 2040	225		225
Promissory Note	5		10
Financed lease obligations	141		184
Other	24		29
Total Manufacturing operations debt	2,906		2,958
Less: Current portion	115		100
Net long-term Manufacturing operations debt	$	2,791	$	2,858

(in millions)	April 30, 2015		October 31, 2014
Financial Services operations
Asset-backed debt issued by consolidated SPEs, at fixed and variable rates, due serially through 2018	$	986	$	914
Bank revolvers, at fixed and variable rates, due dates from 2015 through 2020	1,205		1,242
Commercial paper, at variable rates, program matures in 2017	77		74
Borrowings secured by operating and finance leases, at various rates, due serially through 2018	29		36
Total Financial Services operations debt	2,297		2,266
Less: Current portion	1,096		1,195
Net long-term Financial Services operations debt	$	1,201	$	1,071

18

Navistar International Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements—(Continued)

(Unaudited)

Manufacturing Operations

3.00% Senior Subordinated Convertible Notes

In October 2009, we completed the sale of $570 million aggregate principal amount of 3.00% senior subordinated convertible notes ("2014 Convertible Notes"), including over-allotment options. The 2014 Convertible Notes were senior subordinated unsecured obligations of the Company.

In connection with the sale of the 2014 Convertible Notes, the Company purchased call options for $125 million. The call options covered 11,337,870 shares of common stock, subject to adjustments, at an exercise price of $50.27. The call options were intended to minimize share dilution associated with the 2014 Convertible Notes. In addition, in connection with the sale of the 2014 Convertible Notes, the Company also entered into separate warrant transactions whereby, the Company sold warrants for $87 million to sell in the aggregate 11,337,870 shares of common stock, subject to adjustments, at an exercise price of $60.14 per share of common stock.

During the second quarter of 2014, the Company used proceeds from the private issuance of $411 million of 4.75% senior subordinated convertible notes due April 2019 ("2019 Convertible Notes"), as well as cash on-hand, to repurchase $404 million of notional amount of the 2014 Convertible Notes. The Company recorded a charge of $11 million related to the repurchase which was recognized in Other expense (income), net. In conjunction with the repurchases of the 2014 Convertible Notes, call options representing 8,026,456 shares expired or were unwound by the Company and warrants representing 6,523,319 shares were unwound by the Company. On October 15, 2014, upon maturity, the 2014 Convertible Notes were paid in full and the purchased call options expired worthless.

During the first quarter of 2015, warrants representing 1,939,376 shares were unwound by the Company, and the remaining 2,875,175 warrants expired worthless on April 10, 2015.

Financial Services Operations

Asset-backed Debt

In January 2015, the maturity date of the $500 million variable funding notes ("VFN") facility was extended from March 2015 to January 2016.

In November 2014, NFC completed the sale of $250 million of two-year investor notes secured by assets of the wholesale note owner trust. Proceeds were used, in part, to replace the $200 million of investor notes that matured in January 2015. Also in November 2014, the wholesale note owner trust was amended to reduce customer concentration restrictions.

Bank Revolvers and Commercial Paper

In January 2015, NFC paid $125 million in cash dividends to Navistar, Inc. Dividends and certain affiliate loans are subject to the restricted payment covenants set forth in the NFC bank credit facility.

Effective December 2014, our Mexican financial services operation entered into a new two-year commercial paper program for up to P$1.8 billion (the equivalent of approximately US $118 million at April 30, 2015). This program replaces the existing program that was to mature in August 2015.

7. Postretirement Benefits

Defined Benefit Plans

We provide postretirement benefits to a substantial portion of our employees and retirees. Costs associated with postretirement benefits include pension and postretirement health care expenses for employees, retirees, surviving spouses and dependents.

Generally, the pension plans are non-contributory. Our policy is to fund the pension plans in accordance with applicable U.S. and Canadian government regulations and to make additional contributions from time to time. For the three and six months ended April 30, 2015, we contributed $32 million and $62 million, respectively, and for the three and six months ended April 30, 2014, we contributed $36 million and $65 million, respectively, to our pension plans to meet regulatory funding requirements. In August 2014, the Highway and Transportation Funding Act of 2014 ("HATFA"), including extension of pension funding interest rate relief, was signed into law. As a result, we lowered our funding expectations. We currently anticipate additional contributions of $51 million to our pension plans during the remainder of 2015.

We primarily fund other post-employment benefit ("OPEB") obligations, such as retiree medical, in accordance with a 1993 Settlement Agreement (the "1993 Settlement Agreement"), which requires us to fund a portion of the plans' annual service cost to a retiree benefit trust (the "Base Trust"). The 1993 Settlement Agreement resolved a class action lawsuit originally filed in

19

Navistar International Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements—(Continued)

(Unaudited)

1992 regarding the restructuring of the Company's then applicable retiree health care and life insurance benefits. Contributions for the six months ended April 30, 2015 and 2014, as well as anticipated contributions for the remainder of 2015, are not material.

Components of Net Periodic Benefit Expense

Net postretirement benefits expense included in our Consolidated Statements of Operations is comprised of the following:

	Three Months Ended April 30,												Six Months Ended April 30,
	Pension Benefits						Health and Life Insurance Benefits						Pension Benefits						Health and Life Insurance Benefits
(in millions)	2015			2014			2015			2014			2015			2014			2015			2014
Service cost for benefits earned during the period	$	3		$	2		$	2		$	1		$	6		$	6		$	3		$	2
Interest on obligation	35			40			18			17			71			79			36			34
Amortization of cumulative loss	24			23			9			4			49			47			19			8
Amortization of prior service benefit	—			—			(1		)	(1		)	—			—			(2		)	(2		)
Contractual termination benefits	(1		)	—			(1		)	—			(1		)	—			(1		)	—
Premiums on pension insurance	4			—			—			—			5			—			—			—
Expected return on assets	(48		)	(48		)	(8		)	(8		)	(97		)	(96		)	(15		)	(16		)
Net postretirement benefits expense	$	17		$	17		$	19		$	13		$	33		$	36		$	40		$	26

Defined Contribution Plans and Other Contractual Arrangements

Our defined contribution plans cover a substantial portion of domestic salaried employees and certain domestic represented employees. The defined contribution plans contain a 401(k) feature and provide most participants with a matching contribution from the Company. The Company deposits the matching contribution annually. Many participants covered by the plans receive annual Company contributions to their retirement accounts based on an age-weighted percentage of the participant's eligible compensation for the calendar year. Defined contribution expense pursuant to these plans was $8 million and $17 million in the three and six months ended April 30, 2015, respectively, and $7 million and $15 million for the three and six months ended April 30, 2014, respectively.

In accordance with the 1993 Settlement Agreement, an independent Retiree Supplemental Benefit Trust (the "Supplemental Trust") was established. The Supplemental Trust, and the benefits it provides to certain retirees pursuant to a certain Retiree Supplemental Benefit Program under the 1993 Settlement Agreement ("Supplemental Benefit Program"), is not part of the Company's consolidated financial statements.

The Company's contingent profit sharing obligations under a certain Supplemental Benefits Trust Profit Sharing Plan ("Supplemental Benefit Profit Sharing Plan") will continue until certain funding targets defined by the 1993 Settlement Agreement are met. We have recorded no profit sharing accruals based on the operating performance of the entities that are included in the determination of qualifying profits. For more information, see Note 11, Commitments and Contingencies, for a discussion of pending arbitration regarding the Supplemental Benefit Profit Sharing Plan.

8. Income Taxes

We compute on a quarterly basis an estimated annual effective tax rate considering ordinary income and related income tax expense. For all periods presented, U.S. and certain foreign results are excluded from ordinary income due to ordinary losses for which no benefit can be recognized. Ordinary income refers to income (loss) before income tax expense excluding significant unusual or infrequently occurring items. The tax effect of a significant unusual or infrequently occurring item is recorded in the interim period in which it occurs. Items included in income tax expense in the periods in which they occur include the tax effects of material restructurings, impairments, cumulative effect of changes in tax laws or rates, foreign exchange gains and losses, adjustments to uncertain tax positions, and adjustments to our valuation allowance due to changes in judgment regarding the ability to realize deferred tax assets in future years.

We have evaluated the need to maintain a valuation allowance for deferred tax assets based on our assessment of whether it is more likely than not that deferred tax benefits will be realized through the generation of future taxable income. Appropriate consideration is given to all available evidence, both positive and negative, in assessing the need for a valuation allowance. We continue to maintain a valuation allowance on our U.S. deferred tax assets, as well as certain foreign deferred tax assets, that we believe, on a more-likely-than-not basis, will not be realized. For all remaining deferred tax assets, while we believe that it is more likely than not that they will be realized, we believe that it is reasonably possible that additional deferred tax asset valuation allowances could be required in the next twelve months.

20

Navistar International Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements—(Continued)

(Unaudited)

We recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the consolidated financial statements from such a position are measured based on the largest benefit that has a greater than fifty percent likelihood of being realized upon ultimate settlement. As of April 30, 2015, the amount of liability for uncertain tax positions was $42 million. The liability at April 30, 2015 of $42 million has a recorded offsetting tax benefit associated with various issues that total to $14 million. If the unrecognized tax benefits are recognized, all would impact our effective tax rate. However, to the extent we continue to maintain a full valuation allowance against certain deferred tax assets, the effect may be in the form of an increase in the deferred tax asset related to our net operating loss carryforward, which would be offset by a full valuation allowance.

We recognize interest and penalties related to uncertain tax positions as part of Income tax expense. For the three and six months ended April 30, 2015, total interest and penalties related to our uncertain tax positions resulted in an income tax expense of less than $1 million in each period.

We have open tax years back to 2001 with various significant taxing jurisdictions including the U.S., Canada, Mexico, and Brazil. In connection with the examination of tax returns, contingencies may arise that generally result from differing interpretations of applicable tax laws and regulations as they relate to the amount, timing, or inclusion of revenues or expenses in taxable income, or the sustainability of tax credits to reduce income taxes payable. We believe we have sufficient accruals for our contingent tax liabilities. Annual tax provisions include amounts considered sufficient to pay assessments that may result from examinations of prior year tax returns, although actual results may differ. While it is probable that the liability for unrecognized tax benefits may increase or decrease during the next twelve months, we do not expect any such change would have a material effect on our financial condition, results of operations, or cash flows.

9. Fair Value Measurements

For assets and liabilities measured at fair value on a recurring and nonrecurring basis, a three-level hierarchy of measurements based upon observable and unobservable inputs is used to arrive at fair value. Observable inputs are developed based on market data obtained from independent sources, while unobservable inputs reflect our assumptions about valuation based on the best information available in the circumstances. Depending on the inputs, we classify each fair value measurement as follows:

• Level 1—based upon quoted prices for identical instruments in active markets,

• Level 2—based upon quoted prices for similar instruments, prices for identical or similar instruments in markets that are not active, or model-derived valuations, all of whose significant inputs are observable, and

• Level 3—based upon one or more significant unobservable inputs.

The following section describes key inputs and assumptions in our valuation methodologies:

Cash Equivalents and Restricted Cash Equivalents—We classify highly liquid investments, with an original maturity of 90 days or less, including U.S. Treasury bills, federal agency securities, and commercial paper, as cash equivalents. The carrying amounts of cash and cash equivalents and restricted cash approximate fair value because of the short-term maturity and highly liquid nature of these instruments.

Marketable Securities—Our marketable securities portfolios are classified as available-for-sale and primarily include investments in U.S. government securities and commercial paper with an original maturity greater than 90 days. We use quoted prices from active markets to determine fair value.

Derivative Assets and Liabilities—We measure the fair value of derivatives assuming that the unit of account is an individual derivative transaction and that each derivative could be sold or transferred on a stand-alone basis. We classify within Level 2 our derivatives that are traded over-the-counter and valued using internal models based on observable market inputs. In certain cases, market data is not available and we estimate inputs such as in situations where trading in a particular commodity is not active. Measurements based upon these unobservable inputs are classified within Level 3. For more information regarding derivatives, see Note 10, Financial Instruments and Commodity Contracts.

Guarantees—We provide certain guarantees of payments and residual values to specific counterparties. Fair value of these guarantees is based upon internally developed models that utilize current market-based assumptions and historical data. We classify these liabilities within Level 3. For more information regarding guarantees, see Note 11, Commitments and Contingencies.

21

Navistar International Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements—(Continued)

(Unaudited)

The following table presents the financial instruments measured at fair value on a recurring basis:

	April 30, 2015								October 31, 2014
(in millions)	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
Assets
Marketable securities:
U.S. Treasury bills	$	170	$	—	$	—	$	170	$	256	$	—	$	—	$	256
Other	103		—		—		103		349		—		—		349
Derivative financial instruments:
Interest rate caps(A)	—		1		—		1		—		1		—		1
Total assets	$	273	$	1	$	—	$	274	$	605	$	1	$	—	$	606
Liabilities
Derivative financial instruments:
Commodity forward contracts(B)	$	—	$	5	$	—	$	5	$	—	$	2	$	—	$	2
Foreign currency contracts(C)	—		1		—		1		—		—		—		—
Guarantees	—		—		7		7		—		—		8		8
Total liabilities	$	—	$	6	$	7	$	13	$	—	$	2	$	8	$	10

_________________________

(A) The asset value of interest rate caps are included in other noncurrent assets as of April 30, 2015 and October 31, 2014 in the accompanying Consolidated Balance Sheets.

(B) The liability value of commodity forward contracts are included in other noncurrent liabilities as of April 30, 2015 and October 31, 2014 in the accompanying Consolidated Balance Sheets.

(C) The liability value of foreign currency contracts are included in other noncurrent liabilities as of April 30, 2015 in the accompanying Consolidated Balance Sheets.

The following table presents the changes for those financial instruments classified within Level 3 of the valuation hierarchy:

	Three Months Ended April 30,
(in millions)	2015			2014
Guarantees, at February 1	$	(8	)	$	(6	)
Transfers out of Level 3	—			—
Issuances	—			—
Settlements	1			—
Guarantees, at April 30	$	(7	)	$	(6	)
Change in unrealized gains on assets and liabilities still held	$	—		$	—

	Six Months Ended April 30,
(in millions)	2015			2014
Guarantees, at November 1	$	(8	)	$	(6	)
Transfers out of Level 3	—			—
Issuances	—			—
Settlements	1			—
Guarantees, at April 30	$	(7	)	$	(6	)
Change in unrealized gains on assets and liabilities still held	$	—		$	—

22

Navistar International Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements—(Continued)

(Unaudited)

The following table presents the financial instruments measured at fair value on a nonrecurring basis:

(in millions)	April 30, 2015			October 31, 2014
Level 2 financial instruments
Carrying value of impaired finance receivables (A)	$	20		$	20
Specific loss reserve	(9		)	(6		)
Fair value	$	11		$	14

_________________________

(A) Certain impaired finance receivables are measured at fair value on a nonrecurring basis. An impairment charge is recorded for the amount by which the carrying value of the receivables exceeds the fair value of the underlying collateral, net of remarketing costs. Fair values of the underlying collateral are determined by reference to dealer vehicle value publications adjusted for certain market factors.

In the second quarter of 2014, for the purpose of impairment evaluation the Company measured the implied fair value of the Company's Brazilian engine reporting unit's goodwill and the fair value of an indefinite-lived intangible asset, trademark. The Company's Brazilian engine reporting unit's goodwill was determined to be fully impaired and resulted in a non-cash charge of $142 million. In addition, the related trademark, with a carrying value of $43 million was determined to be impaired and a non-cash charge of $7 million was recognized. The impairment charges were included in Asset impairment charges in the Company's Consolidated Statements of Operations. We utilized the income approach to determine the fair value of these Level 3 assets. For more information, see Note 1, Summary of Significant Accounting Policies.

In the first quarter of 2014, the Company concluded it had a triggering event related to potential sales of assets requiring assessment of impairment for certain intangible and long-lived assets in the Truck segment. As a result, certain amortizing intangible assets and long-lived assets with a carrying value of $18 million were determined to be fully impaired, resulting in an impairment charge of $18 million, which was included in Asset impairment charges in the Company's Consolidated Statements of Operations. We utilized the market approach to determine the fair values of these Level 2 assets.

In addition to the methods and assumptions we use for the financial instruments recorded at fair value as discussed above, we use the following methods and assumptions to estimate the fair value for our other financial instruments that are not marked to market on a recurring basis. The carrying amounts of Cash and cash equivalents, Restricted cash, and Accounts payable approximate fair values because of the short-term maturity and highly liquid nature of these instruments. Finance receivables generally consist of retail and wholesale accounts and retail and wholesale notes. The carrying amounts of Trade and other receivables and retail and wholesale accounts approximate fair values as a result of the short-term nature of the receivables. The carrying amounts of wholesale notes approximate fair values as a result of the short-term nature of the wholesale notes and their variable interest rate terms. The fair values of these financial instruments are classified as Level 1. Due to the nature of the aforementioned financial instruments, they have been excluded from the fair value amounts presented in the table below.

The fair values of our retail notes are estimated by discounting expected cash flows at estimated current market rates. The fair values of our retail notes are classified as Level 3 financial instruments.

The fair values of our debt instruments classified as Level 1 were determined using quoted market prices. The 6.5% Tax Exempt Bonds, due 2040, are traded, but the trading market is illiquid, and as a result, the Loan Agreement underlying the Tax Exempt Bonds is classified as Level 2. The fair values of our Level 3 debt instruments are generally determined using internally developed valuation techniques such as discounted cash flow modeling. Inputs such as discount rates and credit spreads reflect our estimates of assumptions that market participants would use in pricing the instrument and may be unobservable.

23

Navistar International Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements—(Continued)

(Unaudited)

The following tables present the carrying values and estimated fair values of financial instruments:

	As of April 30, 2015
	Estimated Fair Value								Carrying Value
(in millions)	Level 1		Level 2		Level 3		Total
Assets
Retail notes	$	—	$	—	$	209	$	209	$	208
Notes receivable	—		—		5		5		5
Liabilities
Debt:
Manufacturing operations
Senior Secured Term Loan Credit Facility, as Amended, due 2017	—		—		719		719		694
8.25% Senior Notes, due 2021	1,233		—		—		1,233		1,181
4.50% Senior Subordinated Convertible Notes, due 2018(A)	—		—		185		185		183
4.75% Senior Subordinated Convertible Notes, due 2019(A)	—		—		383		383		375
Debt of majority-owned dealerships	—		—		28		28		28
Financing arrangements	—		—		21		21		45
Loan Agreement related to 6.50% Tax Exempt Bonds, due 2040	—		243		—		243		225
Promissory Note	—		—		5		5		5
Financed lease obligations	—		—		141		141		141
Other	—		—		24		24		24
Financial Services operations
Asset-backed debt issued by consolidated SPEs, at various rates, due serially through 2018	—		—		984		984		986
Bank revolvers, at fixed and variable rates, due dates from 2015 through 2020	—		—		1,184		1,184		1,205
Commercial paper, at variable rates, program matures in 2017	77		—		—		77		77
Borrowings secured by operating and finance leases, at various rates, due serially through 2018	—		—		29		29		29

24

Navistar International Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements—(Continued)

(Unaudited)

	As of October 31, 2014
	Estimated Fair Value								Carrying Value
(in millions)	Level 1		Level 2		Level 3		Total
Assets
Retail notes	$	—	$	—	$	279	$	279	$	275
Notes receivable	—		—		7		7		8
Liabilities
Debt:
Manufacturing operations
Senior Secured Term Loan Credit Facility, as Amended, due 2017	—		—		704		704		694
8.25% Senior Notes, due 2021	1,285		—		—		1,285		1,180
4.50% Senior Subordinated Convertible Notes, due 2018(A)	—		—		196		196		181
4.75% Senior Subordinated Convertible Notes, due 2019(A)	—		—		413		413		371
Debt of majority-owned dealerships	—		—		30		30		30
Financing arrangements	—		—		22		22		48
Loan Agreement related to 6.50% Tax Exempt Bonds, due 2040	—		232		—		232		225
Promissory Note	—		—		10		10		10
Financed lease obligations	—		—		184		184		184
Other	—		—		28		28		29
Financial Services operations
Asset-backed debt issued by consolidated SPEs, at various rates, due serially through 2019	—		—		911		911		914
Bank revolvers, at fixed and variable rates, due dates from 2014 through 2020	—		—		1,214		1,214		1,242
Commercial paper, at variable rates, program matures in 2015	74		—		—		74		74
Borrowings secured by operating and finance leases, at various rates, due serially through 2018	—		—		36		36		36

_________________________

(A) The carrying value represents the consolidated financial statement amount of the debt which excludes the allocation of the conversion feature to equity, while the fair value is based on internally developed valuation techniques such as discounted cash flow modeling for Level 3 convertible notes which include the equity feature.

10. Financial Instruments and Commodity Contracts

Derivative Financial Instruments

We use derivative financial instruments as part of our overall interest rate, foreign currency, and commodity risk management strategies to reduce our interest rate exposure, reduce exchange rate risk for transactional exposures denominated in currencies other than the functional currency, and minimize the effect of commodity price volatility. From time to time, we use foreign currency forward and option contracts to manage the risk of exchange rate movements that would affect the value of our foreign currency cash flows. Foreign currency exchange rate movements create a degree of risk by affecting the value of sales made and costs incurred in currencies other than the functional currency. In addition, we also use commodity forward contracts to manage our exposure to variability in certain commodity prices.

We generally do not enter into derivative financial instruments for speculative or trading purposes and did not during the three and six months ended April 30, 2015 and 2014. None of our derivatives qualified for hedge accounting treatment during the three and six months ended April 30, 2015 and 2014.

The majority of our derivative contracts are transacted under International Swaps and Derivatives Association ("ISDA") master agreements. Each agreement permits the net settlement of amounts owed in the event of default or certain other termination events. For derivative financial instruments, we have elected not to offset derivative positions in the balance sheet with the same counterparty under the same agreement. Certain of our derivative contracts contain provisions that require us to provide collateral if certain thresholds are exceeded. Collateral of $1 million was provided at April 30, 2015 and no collateral was provided as of October 31, 2014. Collateral is generally not required to be provided by our counter-parties for derivative contracts. We manage exposure to counter-party credit risk by entering into derivative financial instruments with various major financial institutions that can be expected to fully perform under the terms of such instruments. We do not anticipate nonperformance by any of the counter-parties. Our exposure to credit risk in the event of nonperformance by the counter-parties

25

Navistar International Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements—(Continued)

(Unaudited)

is limited to those assets that have been recorded, but have not yet been received in cash. We had $1 million exposure to the credit risk of others at both April 30, 2015 and October 31, 2014.

	Location in Consolidated Statements of Operations	Three Months Ended April 30,
(in millions)		2015			2014
Interest rate caps	Interest expense	$	—		$	2
Cross currency swaps	Other (income) expense, net	1			(1		)
Foreign currency contracts	Other (income) expense, net	—			1
Commodity forward contracts	Costs of products sold	(5		)	—
Total (income) loss		$	(4	)	$	2

	Location in Consolidated Statements of Operations	Six Months Ended April 30,
(in millions)		2015		2014
Interest rate caps	Interest expense	$	—	$	1
Cross currency swaps	Other (income) expense, net	3		1
Foreign currency contracts	Other (income) expense, net	1		—
Commodity forward contracts	Costs of products sold	5		—
Total loss		$	9	$	2

Foreign Currency Contracts

During 2015 and 2014, we entered into foreign exchange forward and option contracts as economic hedges of anticipated cash flows denominated in Brazilian Reais, Euros, Canadian Dollars, and Mexican Pesos. All contracts were entered into to protect against the risk that the eventual cash flows resulting from certain transactions would be affected by changes in exchange rates between the U.S. Dollar and the respective foreign currency.

The following table presents the outstanding foreign currency contracts as of April 30, 2015 and October 31, 2014:

(in millions)	Currency	Notional Amount		Maturity
As of April 30, 2015
Forward exchange contract	EUR	€	6	May 2015
Forward exchange contract	EUR	€	5	June 2015
Forward exchange contract	EUR	€	5	July 2015
Forward exchange contract	EUR	€	6	August 2015-October 2015(A)
Forward exchange contract	CAD	C$	25	May 2015
Forward exchange contract	CAD	C$	25	June 2015
Forward exchange contract	CAD	C$	25	July 2015
Forward exchange contract	CAD	C$	75	August 2015-October 2015(B)
Forward exchange contract	MXN	₱	763	May 2015
As of October 31, 2014
Forward exchange contract	EUR	€	4	November 2014
Forward exchange contract	EUR	€	4	December 2014
Forward exchange contract	EUR	€	5	January 2015
Forward exchange contract	EUR	€	9	February 2015 - October 2015(C)

_________________________

(A) Forward exchange contracts of €2 million expire on the last day of each month from August 2015 through October 2015.

(B) Forward exchange contracts of C$25 million expire on the last day of each month from August 2015 through October 2015.

(C) Forward exchange contracts of €1 million expire on the last day of each month from February 2015 through October 2015.

Commodity Forward Contracts

During 2015 and 2014, we entered into commodity forward contracts as economic hedges of our exposure to variability in

26

Navistar International Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements—(Continued)

(Unaudited)

commodity prices for diesel fuel and steel. As of April 30, 2015, we had outstanding diesel fuel contracts with aggregate notional values of $17 million and outstanding steel contracts with aggregate notional values of $11 million. The commodity forward contracts have maturity dates ranging from April 30, 2015 to October 31, 2015. As of October 31, 2014, we had outstanding diesel fuel contracts with aggregate notional values of $24 million and outstanding steel contracts with aggregate notional values of $23 million. All of these contracts were entered into to protect against the risk that the eventual cash flows related to purchases of the commodities will be affected by changes in prices.

Interest-Rate Contracts

From time to time, we enter into various interest-rate contracts, interest rate caps, and cross currency swaps. As of April 30, 2015, there were no outstanding cross currency swaps. As of October 31, 2014, the notional amount of our outstanding cross currency swaps was $27 million. We are exposed to interest rate and exchange rate risk as a result of our borrowing activities. The objective of these contracts is to mitigate fluctuations in earnings, cash flows, and fair value of borrowings. Our Mexican financial services operation uses interest rate caps and cross currency swaps to protect against the potential of rising interest rates as required by the terms of its variable-rate asset-backed securities and fluctuations in the value of the peso, as required under Mexican bank credit facilities. As of April 30, 2015 and October 31, 2014, the notional amount of our outstanding interest rate caps was $118 million and $134 million, respectively.

11. Commitments and Contingencies

Guarantees

We occasionally provide guarantees that could obligate us to make future payments if the primary entity fails to perform under its contractual obligations. We have recognized liabilities for some of these guarantees in our Consolidated Balance Sheets as they meet the recognition and measurement provisions of U.S. GAAP. In addition to the liabilities that have been recognized, we are contingently liable for other potential losses under various guarantees. We do not believe that claims that may be made under such guarantees would have a material effect on our financial condition, results of operations, or cash flows.

In March 2010, we entered into an operating agreement, as amended, which contains automatic extensions and is subject to early termination provisions, with GE (the "GE Operating Agreement"). Under the terms of the GE Operating Agreement, as amended, GE is our preferred source of retail customer financing for equipment offered by us and our dealers in the U.S. We provide GE with a loss sharing arrangement for certain credit losses. Under the loss sharing arrangement, as amended, we generally reimburse GE for credit losses in excess of the first 10% of the financed value of a contract; for certain leases we reimburse GE for credit losses up to a maximum of the first 9.5% of the financed value of those lease contracts. The Company’s exposure to loss is mitigated because contracts under the GE Operating Agreement are secured by the financed equipment. There were $1.6 billion and $1.5 billion of outstanding loan principal and operating lease payments receivable at April 30, 2015 and October 31, 2014, financed through the GE Operating Agreement and subject to the loss sharing arrangements in the U.S. The related financed values of these outstanding contracts were $2.3 billion at both April 30, 2015 and October 31, 2014. Generally, we do not carry the contracts under the GE Operating Agreement on our Consolidated Balance Sheets. However, for certain GE financed contracts which we have accounted for as borrowings, we have recognized equipment leased to others of $129 million and financed lease obligations of $139 million in our Consolidated Balance Sheets for the period ended April 30, 2015.

Historically, our losses, representing the entire loss amount, on similar contracts, measured as a percentage of the average balance of the related contracts, ranged from 0.3% to 2.1%. Under limited circumstances NFC retains the right to originate retail customer financings. Based on our historic experience of losses on similar contracts and the nature of the loss sharing arrangement, we do not believe our share of losses related to balances currently outstanding will be material.

For certain independent dealers’ wholesale inventory financed by third-party banks or finance companies, we provide limited repurchase agreements to the respective financing institution. The amount of losses related to these arrangements has not been material to our Consolidated Statements of Operations or Consolidated Statements of Cash Flows and the value of the guarantees and accruals recorded are not material to our Consolidated Balance Sheets.

We also have issued limited residual value guarantees in connection with various leases. The amounts of the guarantees are estimated and recorded. Our guarantees are contingent upon the fair value of the leased assets at the end of the lease term. The amount of losses related to these arrangements has not been material to our Consolidated Statements of Operations or Consolidated Statements of Cash Flows and the value of the guarantees and accruals recorded are not material to our Consolidated Balance Sheets.

27

Navistar International Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements—(Continued)

(Unaudited)

We obtain certain stand-by letters of credit and surety bonds from third-party financial institutions in the ordinary course of business when required under contracts or to satisfy insurance-related requirements. As of April 30, 2015, the amount of stand-by letters of credit and surety bonds was $88 million.

We extend credit commitments to certain truck fleet customers, which allow them to purchase parts and services from participating dealers. The participating dealers receive accelerated payments from us with the result that we carry the receivables and absorb the credit risk related to these customers. As of April 30, 2015, the total credit limit under this program was $11 million of which $7 million was unused.

In addition, as of April 30, 2015, we have entered into various purchase commitments of $120 million and contracts that have cancellation fees of $33 million with various expiration dates through 2020.

In the ordinary course of business, we also provide routine indemnifications and other guarantees, the terms of which range in duration and often are not explicitly defined. We do not believe these will result in claims that would have a material impact on our financial condition, results of operations, or cash flows.

Environmental Liabilities

We have been named a potentially responsible party ("PRP"), in conjunction with other parties, in a number of cases arising under an environmental protection law, the Comprehensive Environmental Response, Compensation, and Liability Act, popularly known as the "Superfund" law. These cases involve sites that allegedly received wastes from current or former Company locations. Based on information available to us which, in most cases, consists of data related to quantities and characteristics of material generated at current or former Company locations, material allegedly shipped by us to these disposal sites, as well as cost estimates from PRPs and/or federal or state regulatory agencies for the cleanup of these sites, a reasonable estimate is calculated of our share of the probable costs, if any, and accruals are recorded in our consolidated financial statements. These accruals are generally recognized no later than upon completion of the remedial feasibility study and are not discounted to their present value. We review all accruals on a regular basis and believe that, based on these calculations, our share of the potential additional costs for the cleanup of each site will not have a material effect on our financial condition, results of operations, or cash flows.

Two sites formerly owned by us: (i) Solar Turbines in San Diego, California, and (ii) the Canton Plant in Canton, Illinois; were identified as having soil and groundwater contamination. Two sites in Sao Paulo, Brazil, one at which we are currently operating and one where we formerly operated, were identified as having soil and groundwater contamination. While investigations and cleanup activities continue at these and other sites, we believe that we have adequate accruals to cover costs to complete the cleanup of all sites.

We have accrued $22 million for these and other environmental matters, which are included within Other current liabilities and Other noncurrent liabilities, as of April 30, 2015. The majority of these accrued liabilities are expected to be paid subsequent to 2015.

Along with other vehicle manufacturers, we have been subject to an increased number of asbestos-related claims in recent years. In general, these claims relate to illnesses alleged to have resulted from asbestos exposure from component parts found in older vehicles, although some cases relate to the alleged presence of asbestos in our facilities. In these claims, we are generally not the sole defendant, and the claims name as defendants numerous manufacturers and suppliers of a wide variety of products allegedly containing asbestos. We have strongly disputed these claims, and it has been our policy to defend against them vigorously. Historically, the actual damages paid out to claimants have not been material in any year to our financial condition, results of operations, or cash flows. It is possible that the number of these claims will continue to grow, and that the costs for resolving asbestos related claims could become significant in the future.

Legal Proceedings

Overview

We are subject to various claims arising in the ordinary course of business, and are party to various legal proceedings that constitute ordinary, routine litigation incidental to our business. The majority of these claims and proceedings relate to commercial, product liability, and warranty matters. In addition, from time to time we are subject to various claims and legal proceedings related to employee compensation, benefits, and benefits administration including, but not limited to, compliance with the Employee Retirement Income Security Act of 1974, as amended ("ERISA"), and Department of Labor requirements. In our opinion, apart from the actions set forth below, the disposition of these proceedings and claims, after taking into account recorded accruals and the availability and limits of our insurance coverage, will not have a material adverse effect on our business or our financial condition, results of operations, or cash flows.

28

Navistar International Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements—(Continued)

(Unaudited)

Profit Sharing Disputes

Pursuant to the 1993 Settlement Agreement, the program administrator and named fiduciary of the Supplemental Benefit Program is the Supplemental Benefit Program committee (the "Committee"), comprised of non-Company individuals. In August 2013, the Committee filed a motion for leave to amend its February 2013 complaint (which sought injunctive relief for the Company to provide certain information to which it was allegedly entitled under the Supplemental Benefits Profit Sharing Plan) and a proposed amended complaint (the "Profit Sharing Complaint") in the U.S. District Court for the Southern District of Ohio (the "Court"). Leave to file the Profit Sharing Complaint was granted by the Court in October 2013. In its Profit Sharing Complaint, the Committee alleged the Company breached the 1993 Settlement Agreement and violated ERISA by failing to properly calculate profit sharing contributions due under the Supplemental Benefits Profit Sharing Plan. The Committee seeks damages in excess of $50 million, injunctive relief and reimbursement of attorneys' fees and costs. In October 2013, the Company filed a Motion to Dismiss the Profit Sharing Complaint and to compel the Committee to comply with the dispute resolution procedures set forth in the Supplemental Benefits Profit Sharing Plan. In March 2014, the Court denied the Company's Motion to Dismiss and ruled, among other things, that the Company waived its right to compel the Committee to comply with the dispute resolution provisions set forth in the Supplemental Benefits Profit Sharing Plan. In April 2014, the Company appealed the Court's refusal to compel the Committee to comply with the dispute resolution process to the Court of Appeals for the 6th Circuit. The Company also filed a motion with the Court to stay all proceedings pending the appeal. In May 2014, the Court granted the motion to stay all proceedings, including discovery, pending the appeal. In March 2015, the Court of Appeals vacated the Court's March 2014 denial of the Company's Motion to Dismiss and related ruling and remanded with instructions to order that the Committee's claims in the Profit Sharing Complaint be arbitrated. In May 2015, the Court ordered that the claims in the Profit Sharing Complaint be arbitrated pursuant to the dispute resolution procedures in the Supplemental Benefit Profit Sharing Plan.

In addition, various local bargaining units of the UAW have filed separate grievances pursuant to the profit sharing plans under various collective bargaining agreements in effect between the Company and the UAW that may have similar legal and factual issues as the Profit Sharing Complaint.

Based on our assessment of the facts underlying the claims in the above actions, we are unable to provide meaningful quantification of how the final resolution of these claims may impact our future consolidated financial condition, results of operations, or cash flows.

FATMA Notice

International Indústria de Motores da América do Sul Ltda. ("IIAA"), formerly known as Maxion International Motores S/A ("Maxion"), now a wholly owned subsidiary of the Company, received a notice in July 2010 from the State of Santa Catarina Environmental Protection Agency ("FATMA") in Brazil. The notice alleged that Maxion had sent wastes to a facility owned and operated by a company known as Natureza and that soil and groundwater contamination had occurred at the Natureza facility. The notice asserted liability against Maxion and assessed an initial penalty in the amount of R$2 million (the equivalent of less than US$1 million at April 30, 2015), which is not due and final until all administrative appeals are exhausted. Maxion was one of numerous companies that received similar notices. IIAA filed an administrative defense in August 2010 and has not yet received a decision following that filing. IIAA disputes the allegations in the notice and intends to vigorously defend itself.

Sao Paulo Groundwater Notice

In March 2014, IIAA, along with other nearby companies, received from the Sao Paulo District Attorney a notice and proposed Consent Agreement relating to alleged neighborhood-wide groundwater contamination at or around its Sao Paulo manufacturing facility. The proposed Consent Agreement seeks certain groundwater investigations and other technical relief and proposes sanctions in the amount of R$3 million (the equivalent of approximately US$1 million at April 30, 2015). In November 2014, IIAA extended a settlement offer and the parties remain in discussions regarding this matter.

MaxxForce Engine EGR Warranty Litigation

On June 24, 2014, N&C Transportation Ltd. filed a putative class action lawsuit against NIC, Navistar, Inc., Navistar Canada Inc., and Harbour International Trucks in Canada in the Supreme Court of British Columbia (the "N&C Action").  Subsequently, five additional, similar putative class action lawsuits have been filed in Canada (together with the N&C Action, the "Canadian Actions").

On July 7, 2014, Par 4 Transport, LLC filed a putative class action lawsuit against Navistar, Inc. in the United States District Court for the Northern District of Illinois (the "Par 4 Action"). Subsequently, similar putative class action lawsuits were filed in various United States district courts, including the Northern District of Illinois, the Eastern District of Wisconsin, the Southern

29

Navistar International Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements—(Continued)

(Unaudited)

District of Florida, the Southern District of Texas, the District of Minnesota, the Northern District of Alabama, the Western District of Kentucky, and the Middle District of Pennsylvania (together with the Par 4 Action, the "U.S. Actions"). The U.S. Actions contained allegations substantially similar to the Canadian Actions. More specifically, the Canadian Actions and the U.S. Actions (collectively, the "EGR Class Actions") seek to certify one or more classes of persons or entities in Canada or the United States who purchased and/or leased a ProStar or other Navistar vehicle equipped with a model year 2008-2013 MaxxForce Advanced EGR engine.  In substance, the EGR Class Actions allege that the MaxxForce Advanced EGR engines are defective and that Navistar, Inc. failed to disclose and/or correct the alleged defect. The EGR Class Actions assert claims based on various theories, including breach of contract, breach of warranty, consumer fraud, unfair competition, misrepresentation and negligence. The EGR Class Actions seek relief in the form of monetary damages, punitive damages, declaratory relief, interest, fees, and costs.

On October 3, 2014, NIC and Navistar, Inc. filed a motion before the United States Judicial Panel on Multidistrict Litigation (the "MDL Panel") seeking to transfer and consolidate before Judge Joan B. Gottschall of the United States District Court for the Northern District of Illinois all of the U.S. Actions then pending, as well as certain non-class action MaxxForce Advanced EGR engine lawsuits pending in various federal district courts. On December 17, 2014, Navistar's motion was granted. The MDL Panel issued an order consolidating all of the U.S. Actions pending on the date the motion was filed before Judge Gottschall in the United States District Court for the Northern District of Illinois. The MDL Panel also consolidated certain non-class action MaxxForce Advanced EGR engine lawsuits pending in the various federal district courts, with the exception of one matter.

For cases filed after the initial ruling by the MDL Panel, we continue to request that the MDL Panel similarly transfer and consolidate cases involving one or more common questions of fact. To date, eight putative class actions and three non-class cases have been added to the MDL proceeding before Judge Gottschall. On March 5, 2015, Judge Gottschall entered an order in the MDL proceeding, appointing interim lead counsel and interim liaison counsel for the Plaintiffs. On May 11, 2015, lead counsel for the Plaintiffs filed a First Master Consolidated Class Action Complaint. The next status conference is set for July 2015.

Based on our assessment of the facts underlying the claims in the above actions, we are unable to provide meaningful quantification of how the final resolution of these claims may impact our future consolidated financial condition, results of operations, or cash flows.

EPA Notice of Violation

In February 2012, Navistar, Inc. received a Notice of Violation ("NOV") from the U.S. Environmental Protection Agency ("EPA"). The NOV pertains to approximately 7,600 diesel engines which, according to the EPA, were produced by Navistar, Inc. in 2010 and, therefore, should have met the EPA's 2010 emissions standards. Navistar, Inc. previously provided information to the EPA evidencing its belief that the engines were in fact produced in 2009. The NOV contains the EPA's conclusion that Navistar, Inc.'s alleged production of the engines in 2010 violated the Federal Clean Air Act. The NOV states that the EPA reserves the right to file an administrative complaint or to refer this matter to the U.S. Department of Justice ("DOJ") with a recommendation that a civil complaint be filed in federal district court. In July 2014, the DOJ informed Navistar that the matter had been referred to the DOJ. Navistar and the DOJ are in continuing discussions concerning this matter. If the DOJ ultimately initiates litigation, it is likely that the DOJ will request a significant civil penalty.

Based on our assessment of the facts underlying the NOV above, we are unable to provide meaningful quantification of how the final resolution of this matter may impact our future consolidated financial condition, results of operations or cash flows.

CARB Notice of Violation

In April 2013, Navistar, Inc. received a notice of violation and proposed settlement ("Notice") from the California Air Resources Board ("CARB"). The Notice alleges violations of the California regulations relating to verification of after-treatment devices and proposed civil penalties of approximately $2.5 million, among other proposed settlement terms. Beginning in June 2013, the Company has made settlement offers to CARB and remains in discussions regarding this matter. In October 2014, the parties tentatively agreed to resolve the matter for a penalty payment of $0.3 million and the Company's agreement to conduct certain in-use testing. The parties are in the process of finalizing documents formalizing the settlement.

Shareholder Litigation

In March 2013, a putative class action complaint, alleging securities fraud, was filed against us by the Construction Workers Pension Trust Fund - Lake County and Vicinity, on behalf of itself and all other similarly situated purchasers of our common stock between the period of November 3, 2010 and August 1, 2012. A second class action complaint was filed in April 2013 by

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Notes to Condensed Consolidated Financial Statements—(Continued)

(Unaudited)

the Norfolk County Retirement System, individually and on behalf of all other similarly situated purchasers of our common stock between the period of June 9, 2010 and August 1, 2012. A third class action complaint was filed in April 2013 by Jane C. Purnell FBO Purnell Family Trust, on behalf of itself and all other similarly situated purchasers of our common stock between the period of November 3, 2010 and August 1, 2012. Each complaint named us as well as Daniel C. Ustian, our former President and Chief Executive Officer, and Andrew J. Cederoth, our former Executive Vice President and Chief Financial Officer as defendants. These complaints (collectively, the "10b-5 Cases") contain similar factual allegations which include, among other things, that we violated the federal securities laws by knowingly issuing materially false and misleading statements concerning our financial condition and future business prospects and that we misrepresented and omitted material facts in filings with the SEC concerning the timing and likelihood of EPA certification of our EGR technology to meet 2010 EPA emission standards. The plaintiffs in these matters seek compensatory damages and attorneys' fees, among other relief. In May 2013, an order was entered transferring and consolidating all cases before one judge and in July 2013, the Court appointed a lead plaintiff and lead plaintiff's counsel. The lead plaintiff filed a consolidated amended complaint in October 2013. The consolidated amended complaint enlarged the proposed class period to June 9, 2009 through August 1, 2012, and named fourteen additional current and former directors and officers as defendants. In December 2013, we filed a motion to dismiss the consolidated amended complaint. In July 2014, the Court granted the defendants' Motions to Dismiss, denied the lead plaintiff's Motion to Strike as moot, and gave the lead plaintiff leave to file a second consolidated amended complaint. In August, 2014, the plaintiff timely filed a Second Amended Complaint, which narrows the claims in two ways. First, the plaintiff abandoned its claims against the majority of the defendants, asserting claims against only Navistar, Dan Ustian, A.J. Cederoth, Jack Allen, and Eric Tech. The plaintiff also shortened the putative class period by changing the class period commencement date from June 9, 2009 to March 10, 2010. Defendants filed their Motion to Dismiss the Second Amended Complaint in September, 2014 and in October, 2014, the plaintiff filed its opposition to defendants Motion to Dismiss. In November, 2014, defendants filed their reply brief in support of defendants Motion to Dismiss the Second Amended Complaint. Also in November 2014, the plaintiff voluntarily dismissed Eric Tech as a defendant. The Court had set a ruling date on the Motion to Dismiss the Second Amended Complaint for February 17, 2015. On the Court's own motions, the ruling date was initially extended to April 15, 2015 and subsequently extended again to May 13, 2015 and subsequently extended again to June 11, 2015.

In March 2013, James Gould filed a derivative complaint on behalf of the Company against us and certain of our current and former directors and former officers. The complaint alleges, among other things, that certain of our current and former directors and former officers committed a breach of fiduciary duty, waste of corporate assets and were unjustly enriched in relation to similar factual allegations made in the 10b-5 Cases. The plaintiff in this matter seeks compensatory damages, certain corporate governance reforms, certain injunctive relief, disgorgement of the proceeds of certain defendants' profits from the sale of Company stock, and attorneys' fees, among other relief. On May 3, 2013, the Court entered a Stipulation and Order to Stay Action, staying the case pending further order of the court or entry of an order on the motion to dismiss the consolidated amended complaint in the 10b-5 Cases. On July 31, 2014, after the amended complaint was dismissed, the parties filed a status report, and the court entered an order on August 27, 2014 continuing the stay pending a ruling on defendants' Motion to Dismiss the Second Amended Complaint in the 10b-5 Cases.

Each of these matters is pending in the United States District Court, Northern District of Illinois.

In August 2013, Abbie Griffin, filed a derivative complaint in the State of Delaware Court of Chancery, on behalf of the Company and all similarly situated stockholders, against the Company, as the nominal defendant, and certain of our current and former directors and former officers. The complaint alleges, among other things, that certain of our current and former directors and former officers committed a breach of fiduciary duty, in relation to similar factual allegations made in the 10b-5 Cases. The plaintiff in this matter seeks compensatory damages, certain corporate governance reforms, certain injunctive relief, and attorneys' fees, among other relief. On August 29, 2013, the court entered an order staying the case pending resolution of the defendant's Motion to Dismiss the consolidated amended complaint in the 10b-5 Cases. On August 5, 2014, the parties filed a status report with the court requesting that the August 2013 stay order remain in place pending a ruling on defendant's Motion to Dismiss the Second Amended Complaint in the 10b-5 Cases and on November 9, 2014, the court entered an order continuing the stay pending a ruling on defendants’ Motion to Dismiss the Second Amended Complaint in the 10b-5 Cases.

Based on our assessment of the facts underlying these matters described above, we are unable to provide meaningful quantification of how the final resolution of these matters may impact our future consolidated financial condition, results of operations, or cash flows.

Brazil Truck Dealer Disputes

In January 2014, IIAA initiated an arbitration proceeding under the International Chamber of Commerce rules seeking payment for goods sold and unpaid, in the amount of R$64 million, including penalties and interest, from a group of four truck dealers in Brazil. The truck dealers are affiliated with each other, but not with us, and are collectively referred to as Navitrucks. In the

31

Navistar International Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements—(Continued)

(Unaudited)

proceeding, IIAA also seeks a declaration of fault against Navitrucks related to the termination of the truck dealer agreements between IIAA and Navitrucks. Navitrucks responded in part by submitting counterclaims against IIAA seeking the amount of R$128 million for damages related to alleged unfulfilled promises and injury to Navitrucks’ reputation. In October 2014, Navitrucks amended their counterclaims by increasing the amount of damages. During a preliminary hearing before the arbitral tribunal on March 24, 2015, the parties agreed to submit all of the pending claims between the parties to the exclusive jurisdiction of the arbitral tribunal. The arbitral tribunal will issue a schedule for the arbitration submissions. As of April 30, 2015, the approximate amount of the IIAA claim against Navitrucks is R$71 million (approximately US$24 million as of April 30, 2015), and the approximate amount of the Navitrucks claim against IIAA is R$182 million (approximately US$61 million as of April 30, 2015).

Based on our assessment of the facts underlying the claims in the above actions, we are unable to provide meaningful quantification of how the final resolution of these claims may impact our future consolidated financial condition, results of operations, or cash flows.

In addition, two other truck dealers and a truck fleet owner in Brazil have initiated separate adversarial proceedings against IIAA that may have similar legal and factual issues as the Navitrucks claim. These other claims are not material either individually or in the aggregate.

Other

U.S. Securities and Exchange Commission Inquiry

In June 2012, Navistar received an informal inquiry from the Chicago Office of the Enforcement Division of the SEC seeking a number of categories of documents for the periods dating back to November 1, 2010, relating to various accounting and disclosure issues. We received a formal order of private investigation in July 2012. We have received subsequent subpoenas from the SEC in connection with their inquiry. In December 2014, the SEC filed an application in the United States District Court for the Northern District of Illinois seeking an order compelling the production of certain documents withheld by Navistar from its responses to the administrative subpoenas on the basis of attorney-client privilege and/or work product doctrine. The discovery dispute involves a small number of documents in relation to the number of documents already produced by Navistar. A status hearing on this matter was held on April 2, 2015 and the parties are awaiting a decision from the Court. We continue to cooperate with the SEC in this matter. At this time, we are unable to predict the outcome of this matter or provide meaningful quantification of how the final resolution of this matter may impact our future consolidated financial condition, results of operations or cash flows.

12. Segment Reporting

During November 2014, we announced changes in our leadership team and in our organizational and reporting structures. We believe this realignment will guide us into the future and enable us to accelerate our performance as we finish the turnaround. These changes impact how our Chief Operating Decision Maker (“CODM”) assesses the performance of our operating segments and makes decisions about resource allocations. As a result, we identified the following changes within our reportable segments:

• The export truck and parts operations, formerly in our Global Operations segment, are now included within the results of our Truck and Parts segments, respectively.

• Parts required to support the military truck lines, formerly within our Parts segment, are now included within the results of our Truck segment.

All prior period segment information has been updated to conform to the 2015 presentation. Other than the changes noted above, there were no material changes to the reportable segments disclosed in our Annual Report on Form 10-K for the year ended October 31, 2014. The change in reportable segments had no effect on the Company's consolidated financial position, results of operations, or cash flows for the periods presented.

The following is a description of our four reporting segments:

• Our Truck segment manufactures and distributes Class 4 through 8 trucks, buses, and military vehicles under the International and IC Bus ("IC") brands, along with production of engines under the MaxxForce brand name and parts required to support the military truck lines, in the markets that include sales in the U.S., Canada, Mexico, and within our export truck business. In an effort to strengthen and maintain our dealer network, this segment occasionally acquires and operates dealer locations for the purpose of transitioning ownership.

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Notes to Condensed Consolidated Financial Statements—(Continued)

(Unaudited)

• Our Parts segment provides customers with proprietary products needed to support the International commercial truck, IC Bus, MaxxForce engine lines, and export parts business, as well as our other product lines. Our Parts segment also provides a wide selection of other standard truck, trailer, and engine aftermarket parts. Also included in the Parts segment are the operating results of BDP, which manages the sourcing, merchandising, and distribution of certain service parts we sell to Ford in North America.

• Our Global Operations segment primarily consists of the IIAA (formerly MWM International Industria De Motores Da America Do Sul Ltda. ("MWM")) engine and truck operations in Brazil. The IIAA engine operations produce diesel engines, primarily under contract manufacturing arrangements, as well as under the MWM brand, for sale to OEMs in South America. In addition, our Global Operations segment includes the operating results of our joint venture in China with Anhui Jianghuai Automobile Co ("JAC").

• Our Financial Services segment provides retail, wholesale, and lease financing of products sold by the Truck and Parts segments and their dealers within the U.S. and Mexico, as well as financing for wholesale accounts and selected retail accounts receivable.

Corporate contains those items that are not included in our four segments.

Segment Profit (Loss)

We define segment profit (loss) as Net income (loss) from continuing operations attributable to Navistar International Corporation excluding Income tax benefit (expense). Selected financial information is as follows:

(in millions)	Truck			Parts		Global Operations			Financial Services(A)		Corporate and Eliminations			Total
Three Months Ended April 30, 2015
External sales and revenues, net	$	1,933		$	607	$	115		$	35	$	3		$	2,693
Intersegment sales and revenues(B)	33			6		15			25		(79		)	—
Total sales and revenues, net	$	1,966		$	613	$	130		$	60	$	(76	)	$	2,693
Income (loss) from continuing operations attributable to NIC, net of tax	$	(51	)	$	133	$	1		$	22	$	(169	)	$	(64	)
Income tax expense	—			—		—			—		(18		)	(18		)
Segment profit (loss)	$	(51	)	$	133	$	1		$	22	$	(151	)	$	(46	)
Depreciation and amortization	$	47		$	4	$	5		$	12	$	6		$	74
Interest expense	—			—		—			18		57			75
Equity in income (loss) of non-consolidated affiliates	1			1		(1		)	—		—			1
Capital expenditures(C)	24			—		1			2		1			28

(in millions)	Truck			Parts		Global Operations			Financial Services(A)		Corporate and Eliminations			Total
Three Months Ended April 30, 2014
External sales and revenues, net	$	1,829		$	614	$	265		$	38	$	—		$	2,746
Intersegment sales and revenues	60			16		6			19		(101		)	—
Total sales and revenues, net	$	1,889		$	630	$	271		$	57	$	(101	)	$	2,746
Income (loss) from continuing operations attributable to NIC, net of tax	$	(129	)	$	133	$	(162	)	$	24	$	(164	)	$	(298	)
Income tax expense	—			—		—			—		(23		)	(23		)
Segment profit (loss)	$	(129	)	$	133	$	(162	)	$	24	$	(141	)	$	(275	)
Depreciation and amortization	$	71		$	4	$	6		$	11	$	7		$	99
Interest expense	—			—		—			17		57			74
Equity in income of non-consolidated affiliates	1			1		1			—		—			3
Capital expenditures(C)	26			1		1			—		1			29

33

Navistar International Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements—(Continued)

(Unaudited)

(in millions)	Truck			Parts		Global Operations			Financial Services(A)		Corporate and Eliminations			Total
Six Months Ended April 30, 2015
External sales and revenues, net	$	3,564		$	1,221	$	253		$	71	$	5		$	5,114
Intersegment sales and revenues(B)	72			18		29			49		(168		)	—
Total sales and revenues, net	$	3,636		$	1,239	$	282		$	120	$	(163	)	$	5,114
Income (loss) from continuing operations attributable to NIC, net of tax	$	(69	)	$	278	$	(14	)	$	46	$	(347	)	$	(106	)
Income tax expense	—			—		—			—		(25		)	(25		)
Segment profit (loss)	$	(69	)	$	278	$	(14	)	$	46	$	(322	)	$	(81	)
Depreciation and amortization	$	99		$	7	$	12		$	24	$	11		$	153
Interest expense	—			—		—			38		114			152
Equity in income (loss) of non-consolidated affiliates	3			2		(2		)	—		—			3
Capital expenditures(C)	38			—		3			2		2			45

(in millions)	Truck			Parts		Global Operations			Financial Services(A)		Corporate and Eliminations			Total
Six Months Ended April 30, 2014
External sales and revenues, net	$	3,220		$	1,188	$	469		$	77	$	—		$	4,954
Intersegment sales and revenues	120			28		14			35		(197		)	—
Total sales and revenues, net	$	3,340		$	1,216	$	483		$	112	$	(197	)	$	4,954
Income (loss) from continuing operations attributable to NIC, net of tax	$	(337	)	$	241	$	(197	)	$	47	$	(301	)	$	(547	)
Income tax expense	—			—		—			—		(11		)	(11		)
Segment profit (loss)	$	(337	)	$	241	$	(197	)	$	47	$	(290	)	$	(536	)
Depreciation and amortization	$	129		$	8	$	14		$	21	$	13		$	185
Interest expense	—			—		—			34		122			156
Equity in income (loss) of non-consolidated affiliates	2			2		(1		)	—		—			3
Capital expenditures(C)	38			5		4			1		2			50

(in millions)	Truck		Parts		Global Operations		Financial Services		Corporate and Eliminations		Total
Segment assets, as of:
April 30, 2015	$	2,104	$	669	$	514	$	2,611	$	1,027	$	6,925
October 31, 2014	2,245		672		657		2,598		1,271		7,443

_________________________

(A) Total sales and revenues in the Financial Services segment include interest revenues of $44 million and $89 million for the three and six months ended April 30, 2015, respectively and $42 million and $82 million for the three and six months ended April 30, 2014, respectively.

(B) During the second quarter of 2015, we identified a $35 million adjustment related to the first quarter of 2015 Intersegment sales and revenues. As a result, the Truck segment and Corporate and Eliminations should have reported Intersegment sales and revenues of $39 million and $(89) million, respectively, and reported Total sales and revenues, net, of $1,670 million and $(87) million, respectively, for the three months ended January 31, 2015. The adjustment did not impact the consolidated results for the first quarter of 2015.

(C) Exclusive of purchases of equipment leased to others.

34

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Notes to Condensed Consolidated Financial Statements—(Continued)

(Unaudited)

13. Stockholders' Deficit

Accumulated Other Comprehensive Loss

Changes in Accumulated other comprehensive loss, net of tax, included in the Consolidated Statements of Stockholders' Deficit, consisted of the following:

(in millions)	Unrealized Gain on Marketable Securities		Foreign Currency Translation Adjustments			Defined Benefit Plans			Total
Balance as of January 31, 2015	$	1	$	(186	)	$	(2,105	)	$	(2,290	)
Other comprehensive loss before reclassifications	—		(27		)	—			(27		)
Amounts reclassified out of accumulated other comprehensive loss	—		—			33			33
Net current-period other comprehensive income (loss)	—		(27		)	33			6
Balance as of April 30, 2015	$	1	$	(213	)	$	(2,072	)	$	(2,284	)

(in millions)	Unrealized Gain on Marketable Securities		Foreign Currency Translation Adjustments			Defined Benefit Plans			Total
Balance as of October 31, 2014	$	1	$	(127	)	$	(2,137	)	$	(2,263	)
Other comprehensive loss before reclassifications	—		(86		)	—			(86		)
Amounts reclassified out of accumulated other comprehensive loss	—		—			65			65
Net current-period other comprehensive income (loss)	—		(86		)	65			(21		)
Balance as of April 30, 2015	$	1	$	(213	)	$	(2,072	)	$	(2,284	)

(in millions)	Unrealized Gain on Marketable Securities		Foreign Currency Translation Adjustments			Defined Benefit Plans			Total
Balance as of January 31, 2014	$	—	$	(137	)	$	(1,724	)	$	(1,861	)
Other comprehensive income (loss) before reclassifications	—		48			(1		)	47
Amounts reclassified out of accumulated other comprehensive loss	—		—			26			26
Net current-period other comprehensive income	—		48			25			73
Balance as of April 30, 2014	$	—	$	(89	)	$	(1,699	)	$	(1,788	)

(in millions)	Unrealized Gain on Marketable Securities		Foreign Currency Translation Adjustments			Defined Benefit Plans			Total
Balance as of October 31, 2013	$	—	$	(75	)	$	(1,749	)	$	(1,824	)
Other comprehensive loss before reclassifications	—		(14		)	(2		)	(16		)
Amounts reclassified out of accumulated other comprehensive loss	—		—			52			52
Net current-period other comprehensive income (loss)	—		(14		)	50			36
Balance as of April 30, 2014	$	—	$	(89	)	$	(1,699	)	$	(1,788	)

35

Navistar International Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements—(Continued)

(Unaudited)

The following table displays the amounts reclassified from Accumulated other comprehensive loss and the affected line item in the Consolidated Statements of Operations:

	Location in Consolidated Statements of Operations	Three Months Ended April 30, 2015			Six Months Ended April 30, 2015
Defined benefit plans
Amortization of prior service costs	Selling, general and administrative expenses	$	(1	)	$	(2	)
Amortization of actuarial loss	Selling, general and administrative expenses	34			68
	Total before tax	$	33		$	66
	Tax expense	—			(1		)
Total reclassifications for the period, net of tax		$	33		$	65

	Location in Consolidated Statements of Operations	Three Months Ended April 30, 2014			Six Months Ended April 30, 2014
Defined benefit plans
Amortization of prior service costs	Selling, general and administrative expenses	$	(1	)	$	(2	)
Amortization of actuarial loss	Selling, general and administrative expenses	27			54
Total reclassifications for the period (net of tax of $0 at both dates)		$	26		$	52

36

Navistar International Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements—(Continued)

(Unaudited)

14. Earnings (Loss) Per Share Attributable to Navistar International Corporation

The following table presents the information used in the calculation of our basic and diluted income (loss) per share for continuing operations, discontinued operations, and net loss, all attributable to Navistar International Corporation:

	Three Months Ended April 30,						Six Months Ended April 30,
(in millions, except per share data)	2015			2014			2015			2014
Numerator:
Amounts attributable to Navistar International Corporation common stockholders:
Loss from continuing operations, net of tax	$	(64	)	$	(298	)	$	(106	)	$	(547	)
Income from discontinued operations, net of tax	—			1			—			2
Net loss	$	(64	)	$	(297	)	$	(106	)	$	(545	)
Denominator:
Weighted average shares outstanding:
Basic	81.6			81.4			81.5			81.3
Effect of dilutive securities	—			—			—			—
Diluted	81.6			81.4			81.5			81.3
Earnings (loss) per share attributable to Navistar International Corporation:
Basic:
Continuing operations	$	(0.78	)	$	(3.66	)	$	(1.30	)	$	(6.73	)
Discontinued operations	—			0.01			—			0.03
Net loss	$	(0.78	)	$	(3.65	)	$	(1.30	)	$	(6.70	)
Diluted:
Continuing operations	$	(0.78	)	$	(3.66	)	$	(1.30	)	$	(6.73	)
Discontinued operations	—			0.01			—			0.03
Net loss	$	(0.78	)	$	(3.65	)	$	(1.30	)	$	(6.70	)

The conversion rate on our 2014 Convertible Notes were 19.891 shares of common stock per $1,000 principal amount of 2014 Convertible Notes, equivalent to an initial conversion price of $50.27 per share of common stock. In connection with the sale of the 2014 Convertible Notes, we sold warrants to various counterparties to purchase shares of our common stock from us at an exercise price of $60.14 per share. The 2014 Convertible Notes and warrants were anti-dilutive when calculating diluted earnings per share when our average stock price is less than $50.27 and $60.14, respectively. During the second quarter of 2014, the Company unwound warrants representing 6.5 million shares associated with the repurchased 2014 Convertible Notes. On October 15, 2014, upon maturity the 2014 Convertible Notes were repaid in full. During the first quarter of 2015, the Company unwound warrants representing 1.9 million shares associated with the 2014 Convertible Notes, and the remaining 2.9 million warrants expired worthless on April 10, 2015.

The conversion rate on our 4.50% Senior Subordinated Convertible Notes due 2018 ("the 2018 Convertible Notes") is 17.1233 shares of common stock per $1,000 principal amount of 2018 Convertible Notes, equivalent to an initial conversion price of approximately $58.40 per share of common stock. The 2018 Convertible Notes are anti-dilutive when calculating diluted earnings per share when our average stock price is less than $58.40.

The conversion rate on our 2019 Convertible Notes is 18.4946 shares of common stock per $1,000 principal amount of 2019 Convertible Notes, equivalent to an initial conversion price of approximately $54.07 per share of common stock. The 2019 Convertible Notes are anti-dilutive when calculating diluted earnings per share when our average stock price is less than $54.07.

The computation of diluted earnings per share also excludes outstanding options and other common stock equivalents in periods where inclusion of such potential common stock instruments would be anti-dilutive.

For the three and six months ended April 30, 2015 and 2014, no dilutive securities were included in the computation of diluted loss per share since they would have been anti-dilutive due to the net loss attributable to Navistar International Corporation. Additionally, certain securities have been excluded from the computation of earnings per share, as our average stock price was less than their respective exercise prices. For both the three and six months ended April 30, 2015, the aggregate shares not included were 16.0 million. For the three and six months ended April 30, 2014, the aggregate shares not included were 24.0 million and 27.3 million, respectively.

37

Navistar International Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements—(Continued)

(Unaudited)

For both the three and six months ended April 30, 2015, the aggregate shares not included in the computation of earnings per share were primarily comprised of 3.4 million shares related to the 2018 Convertible Notes, and 7.6 million shares related to the 2019 Convertible Notes.

For the three months ended April 30, 2014, the aggregate shares not included in the computation of earnings per share were primarily comprised of 4.8 million shares related to the warrants, 3.3 million shares related to the 2014 Convertible Notes, 3.4 million shares related to the 2018 Convertible Notes, and 7.6 million shares related to the 2019 Convertible Notes.

For the six months ended April 30, 2014, the aggregate shares not included in the computation of earnings per share were primarily comprised of 8.1 million shares related to the warrants, 7.3 million shares related to the 2014 Convertible Notes, 3.4 million shares related to the 2018 Convertible Notes, and 3.8 million shares related to the 2019 Convertible Notes.

15. Condensed Consolidating Guarantor and Non-guarantor Financial Information

The following tables set forth condensed consolidating balance sheets as of April 30, 2015 and October 31, 2014, and condensed consolidating statements of operations and condensed consolidating statements of comprehensive income (loss) for the three and six months ended April 30, 2015 and 2014, and condensed consolidating statements of cash flows for the six months ended April 30, 2015 and 2014.

The information is presented as a result of Navistar, Inc.’s guarantee, exclusive of its subsidiaries, of NIC’s indebtedness under our 8.25% Senior Notes, due 2021, and obligations under our Loan Agreement related to the 6.5% Tax Exempt Bonds, due 2040. Navistar, Inc. is a direct wholly-owned subsidiary of NIC. None of NIC’s other subsidiaries guarantee any of these notes or bonds. The guarantees are "full and unconditional", as those terms are used in Regulation S-X Rule 3-10, except that the guarantees will be automatically released in certain customary circumstances, such as when the subsidiary is sold or all of the assets of the subsidiary are sold, the capital stock is sold, when the subsidiary is designated as an "unrestricted subsidiary" for purposes of the respective indenture for each of the 8.25% Senior Notes, due 2021, and the 6.5% Tax Exempt Bonds, due 2040, upon liquidation or dissolution of the subsidiary or upon legal or covenant defeasance, or satisfaction and discharge of the notes or bonds. Separate financial statements and other disclosures concerning Navistar, Inc. have not been presented because management believes that such information is not material to investors. Within this disclosure only, "NIC" includes the financial results of the parent company only, with all of its wholly-owned subsidiaries accounted for under the equity method. Likewise, "Navistar, Inc.," for purposes of this disclosure only, includes the consolidated financial results of its wholly-owned subsidiaries accounted for under the equity method and its operating units accounted for on a consolidated basis. "Non-Guarantor Subsidiaries" includes the combined financial results of all other non-guarantor subsidiaries. "Eliminations and Other" includes all eliminations and reclassifications to reconcile to the consolidated financial statements. NIC files a consolidated U.S. federal income tax return that includes Navistar, Inc. and its U.S. subsidiaries. Navistar, Inc. has a tax allocation agreement ("Tax Agreement") with NIC which requires Navistar, Inc. to compute its separate federal income tax liability and remit any resulting tax liability to NIC. Tax benefits that may arise from net operating losses of Navistar, Inc. are not refunded to Navistar, Inc. but may be used to offset future required tax payments under the Tax Agreement. The effect of the Tax Agreement is to allow NIC, the parent company, rather than Navistar, Inc., to utilize current U.S. taxable losses of Navistar, Inc. and all other direct or indirect subsidiaries of NIC.

38

Navistar International Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements—(Continued)

(Unaudited)

Condensed Consolidating Statement of Operations for the Three Months Ended April 30, 2015
(in millions)	NIC			Navistar, Inc.			Non-Guarantor Subsidiaries			Eliminations and Other			Consolidated
Sales and revenues, net	$	—		$	2,009		$	1,943		$	(1,259	)	$	2,693
Costs of products sold	—			1,864			1,735			(1,239		)	2,360
Restructuring charges	—			—			6			—			6
Asset impairment charges	—			1			—			—			1
All other operating expenses (income)	27			282			79			(22		)	366
Total costs and expenses	27			2,147			1,820			(1,261		)	2,733
Equity in income (loss) of affiliates	(37		)	64			—			(26		)	1
Income (loss) before income taxes	(64		)	(74		)	123			(24		)	(39		)
Income tax expense	—			(1		)	(17		)	—			(18		)
Earnings (loss) from continuing operations	(64		)	(75		)	106			(24		)	(57		)
Income from discontinued operations, net of tax	—			—			—			—			—
Net income (loss)	(64		)	(75		)	106			(24		)	(57		)
Less: Net income attributable to non-controlling interests	—			—			7			—			7
Net income (loss) attributable to Navistar International Corporation	$	(64	)	$	(75	)	$	99		$	(24	)	$	(64	)

Condensed Consolidating Statement of Comprehensive Income (Loss) for the Three Months Ended April 30, 2015
(in millions)	NIC			Navistar, Inc.			Non-Guarantor Subsidiaries			Eliminations and Other			Consolidated
Net income (loss) attributable to Navistar International Corporation	$	(64	)	$	(75	)	$	99		$	(24	)	$	(64	)
Other comprehensive income (loss):
Foreign currency translation adjustment	(27		)	—			(27		)	27			(27		)
Defined benefit plans (net of tax of $(0), for all entities)	33			31			2			(33		)	33
Total other comprehensive income (loss)	6			31			(25		)	(6		)	6
Total comprehensive income (loss) attributable to Navistar International Corporation	$	(58	)	$	(44	)	$	74		$	(30	)	$	(58	)

Condensed Consolidating Statement of Operations for the Six Months Ended April 30, 2015
(in millions)	NIC			Navistar, Inc.			Non-Guarantor Subsidiaries			Eliminations and Other			Consolidated
Sales and revenues, net	$	—		$	3,619		$	3,711		$	(2,216	)	$	5,114
Costs of products sold	—			3,273			3,305			(2,173		)	4,405
Restructuring charges	—			3			6			—			9
Asset impairment charges	—			8			—			—			8
All other operating expenses (income)	50			546			204			(40		)	760
Total costs and expenses	50			3,830			3,515			(2,213		)	5,182
Equity in income (loss) of affiliates	(56		)	79			1			(21		)	3
Income (loss) before income taxes	(106		)	(132		)	197			(24		)	(65		)
Income tax expense	—			(2		)	(23		)	—			(25		)
Earnings (loss) from continuing operations	(106		)	(134		)	174			(24		)	(90		)
Income from discontinued operations, net of tax	—			—			—			—			—
Net income (loss)	(106		)	(134		)	174			(24		)	(90		)
Less: Net income attributable to non-controlling interests	—			—			16			—			16
Net income (loss) attributable to Navistar International Corporation	$	(106	)	$	(134	)	$	158		$	(24	)	$	(106	)

39

Navistar International Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements—(Continued)

(Unaudited)

Condensed Consolidating Statement of Comprehensive Income (Loss) for the Six Months Ended April 30, 2015
(in millions)	NIC			Navistar, Inc.			Non-Guarantor Subsidiaries			Eliminations and Other			Consolidated
Net income (loss) attributable to Navistar International Corporation	$	(106	)	$	(134	)	$	158		$	(24	)	$	(106	)
Other comprehensive income (loss):
Foreign currency translation adjustment	(86		)	—			(86		)	86			(86		)
Defined benefit plans (net of tax of $(1), $(0), $(1), $1, and $(1), respectively)	65			62			3			(65		)	65
Total other comprehensive income (loss)	(21		)	62			(83		)	21			(21		)
Total comprehensive income (loss) attributable to Navistar International Corporation	$	(127	)	$	(72	)	$	75		$	(3	)	$	(127	)

Condensed Consolidating Balance Sheet as of April 30, 2015
(in millions)	NIC			Navistar, Inc.			Non-Guarantor Subsidiaries			Eliminations and Other			Consolidated
Assets
Cash and cash equivalents	$	163		$	37		$	383		$	—		$	583
Marketable securities	150			—			123			—			273
Restricted cash	17			6			90			—			113
Finance and other receivables, net	3			132			2,558			(19		)	2,674
Inventories	—			785			475			(15		)	1,245
Investments in non-consolidated affiliates	(7,322		)	6,495			65			830			68
Property and equipment, net	—			768			646			(7		)	1,407
Goodwill	—			—			38			—			38
Deferred taxes, net	5			9			158			—			172
Other	32			141			179			—			352
Total assets	$	(6,952	)	$	8,373		$	4,715		$	789		$	6,925
Liabilities and stockholders’ equity (deficit)
Debt	$	1,965		$	887		$	2,357		$	(6	)	$	5,203
Postretirement benefits liabilities	—			2,639			227			—			2,866
Amounts due to (from) affiliates	(7,749		)	11,963			(4,352		)	138			—
Other liabilities	3,606			249			(182		)	(73		)	3,600
Total liabilities	(2,178		)	15,738			(1,950		)	59			11,669
Redeemable equity securities	1			—			—			—			1
Stockholders’ equity attributable to non-controlling interest	—			—			30			—			30
Stockholders’ equity (deficit) attributable to Navistar International Corporation	(4,775		)	(7,365		)	6,635			730			(4,775		)
Total liabilities and stockholders’ equity (deficit)	$	(6,952	)	$	8,373		$	4,715		$	789		$	6,925

40

Navistar International Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements—(Continued)

(Unaudited)

Condensed Consolidating Statement of Cash Flows for the Six Months Ended April 30, 2015
(in millions)	NIC			Navistar, Inc.			Non-Guarantor Subsidiaries			Eliminations and Other			Consolidated
Net cash provided by (used in) operations	$	(168	)	$	41		$	(188	)	$	78		$	(237	)
Cash flows from investment activities
Net change in restricted cash and cash equivalents	1			(2		)	54			—			53
Net sales of marketable securities	229			—			103			—			332
Capital expenditures and purchase of equipment leased to others	—			(30		)	(35		)	—			(65		)
Other investing activities	—			7			5			—			12
Net cash provided by (used in) investment activities	230			(25		)	127			—			332
Cash flows from financing activities
Net borrowings (repayments) of debt	—			(52		)	66			2			16
Other financing activities	—			20			61			(80		)	1
Net cash provided by (used in) financing activities	—			(32		)	127			(78		)	17
Effect of exchange rate changes on cash and cash equivalents	—			—			(26		)	—			(26		)
Increase (decrease) in cash and cash equivalents	62			(16		)	40			—			86
Cash and cash equivalents at beginning of the period	101			53			343			—			497
Cash and cash equivalents at end of the period	$	163		$	37		$	383		$	—		$	583

Condensed Consolidating Statement of Operations for the Three Months Ended April 30, 2014
(in millions)	NIC			Navistar, Inc.			Non-Guarantor Subsidiaries			Eliminations and Other			Consolidated
Sales and revenues, net	$	—		$	1,893		$	2,061		$	(1,208	)	$	2,746
Costs of products sold	—			1,797			1,862			(1,191		)	2,468
Restructuring charges	—			8			—			—			8
Asset impairment charges	—			—			153			(2		)	151
All other operating expenses (income)	41			273			89			(17		)	386
Total costs and expenses	41			2,078			2,104			(1,210		)	3,013
Equity in income (loss) of affiliates	(269		)	(141		)	2			411			3
Income (loss) before income taxes	(310		)	(326		)	(41		)	413			(264		)
Income tax benefit (expense)	13			(8		)	(28		)	—			(23		)
Earnings (loss) from continuing operations	(297		)	(334		)	(69		)	413			(287		)
Income from discontinued operations, net of tax	—			—			1			—			1
Net income (loss)	(297		)	(334		)	(68		)	413			(286		)
Less: Net income attributable to non-controlling interests	—			—			11			—			11
Net income (loss) attributable to Navistar International Corporation	$	(297	)	$	(334	)	$	(79	)	$	413		$	(297	)

41

Navistar International Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements—(Continued)

(Unaudited)

Condensed Consolidating Statement of Comprehensive Income (Loss) for the Three Months Ended April 30, 2014
(in millions)	NIC			Navistar, Inc.			Non-Guarantor Subsidiaries			Eliminations and Other			Consolidated
Net income (loss) attributable to Navistar International Corporation	$	(297	)	$	(334	)	$	(79	)	$	413		$	(297	)
Other comprehensive income (loss):
Foreign currency translation adjustment	48			—			48			(48		)	48
Defined benefit plans (net of tax of $0, for all entities)	25			25			—			(25		)	25
Total other comprehensive income (loss)	73			25			48			(73		)	73
Total comprehensive income (loss) attributable to Navistar International Corporation	$	(224	)	$	(309	)	$	(31	)	$	340		$	(224	)

Condensed Consolidating Statement of Operations for the Six Months Ended April 30, 2014
(in millions)	NIC			Navistar, Inc.			Non-Guarantor Subsidiaries			Eliminations and Other			Consolidated
Sales and revenues, net	$	—		$	3,317		$	3,790		$	(2,153	)	$	4,954
Costs of products sold	—			3,222			3,393			(2,133		)	4,482
Restructuring charges	—			10			1			—			11
Asset impairment charges	—			—			171			(2		)	169
All other operating expenses (income)	77			514			248			(28		)	811
Total costs and expenses	77			3,746			3,813			(2,163		)	5,473
Equity in income (loss) of affiliates	(481		)	(152		)	1			635			3
Income (loss) before income taxes	(558		)	(581		)	(22		)	645			(516		)
Income tax benefit (expense)	13			(1		)	(23		)	—			(11		)
Earnings (loss) from continuing operations	(545		)	(582		)	(45		)	645			(527		)
Income from discontinued operations, net of tax	—			—			2			—			2
Net income (loss)	(545		)	(582		)	(43		)	645			(525		)
Less: Net income attributable to non-controlling interests	—			—			20			—			20
Net income (loss) attributable to Navistar International Corporation	$	(545	)	$	(582	)	$	(63	)	$	645		$	(545	)

Condensed Consolidating Statement of Comprehensive Income (Loss) for the Six Months Ended April 30, 2014
(in millions)	NIC			Navistar, Inc.			Non-Guarantor Subsidiaries			Eliminations and Other			Consolidated
Net income (loss) attributable to Navistar International Corporation	$	(545	)	$	(582	)	$	(63	)	$	645		$	(545	)
Other comprehensive income (loss):
Foreign currency translation adjustment	(14		)	—			(14		)	14			(14		)
Defined benefit plans (net of tax of $(1) $0, $(1), $1, and $(1), respectively)	50			50			—			(50		)	50
Total other comprehensive income (loss)	36			50			(14		)	(36		)	36
Total comprehensive income (loss) attributable to Navistar International Corporation	$	(509	)	$	(532	)	$	(77	)	$	609		$	(509	)

42

Navistar International Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements—(Continued)

(Unaudited)

Condensed Consolidating Balance Sheet as of October 31, 2014
(in millions)	NIC			Navistar, Inc.			Non-Guarantor Subsidiaries			Eliminations and Other			Consolidated
Assets
Cash and cash equivalents	$	101		$	53		$	343		$	—		$	497
Marketable securities	379			—			226			—			605
Restricted cash	19			4			148			—			171
Finance and other receivables, net	—			124			2,504			(12		)	2,616
Inventories	—			792			539			(12		)	1,319
Investments in non-consolidated affiliates	(7,245		)	6,410			71			837			73
Property and equipment, net	—			827			740			(5		)	1,562
Goodwill	—			—			38			—			38
Deferred taxes, net	5			9			185			1			200
Other	34			137			194			(3		)	362
Total assets	$	(6,707	)	$	8,356		$	4,988		$	806		$	7,443
Liabilities and stockholders’ equity (deficit)
Debt	$	1,958		$	937		$	2,336		$	(7	)	$	5,224
Postretirement benefits liabilities	—			2,712			243			—			2,955
Amounts due to (from) affiliates	(7,618		)	11,739			(4,267		)	146			—
Other liabilities	3,605			370			(22		)	(71		)	3,882
Total liabilities	(2,055		)	15,758			(1,710		)	68			12,061
Redeemable equity securities	2			—			—			—			2
Stockholders’ equity attributable to non-controlling interest	—			—			34			—			34
Stockholders’ equity (deficit) attributable to Navistar International Corporation	(4,654		)	(7,402		)	6,664			738			(4,654		)
Total liabilities and stockholders’ equity (deficit)	$	(6,707	)	$	8,356		$	4,988		$	806		$	7,443

Condensed Consolidating Statement of Cash Flows for the Six Months Ended April 30, 2014
(in millions)	NIC			Navistar, Inc.			Non-Guarantor Subsidiaries			Eliminations and Other			Consolidated
Net cash provided by (used in) operations	$	(458	)	$	(961	)	$	85		$	1,008		$	(326	)
Cash flows from investment activities
Net change in restricted cash and cash equivalents	5			(1		)	(25		)	—			(21		)
Net sales of marketable securities	389			—			(93		)	—			296
Capital expenditures and purchase of equipment leased to others	—			(67		)	(91		)	—			(158		)
Other investing activities	—			8			17			—			25
Net cash provided by (used in) investment activities	394			(60		)	(192		)	—			142
Cash flows from financing activities
Net borrowings (repayments) of debt	(10		)	959			68			(1,006		)	11
Other financing activities	18			34			(30		)	—			22
Net cash provided by (used in) financing activities	8			993			38			(1,006		)	33
Effect of exchange rate changes on cash and cash equivalents	—			—			(8		)	(2		)	(10		)
Decrease in cash and cash equivalents	(56		)	(28		)	(77		)	—			(161		)
Cash and cash equivalents at beginning of the period	336			72			347			—			755
Cash and cash equivalents at end of the period	$	280		$	44		$	270		$	—		$	594

43

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

Management’s Discussion and Analysis of Financial Condition and Results of Operation ("MD&A") is designed to provide information that is supplemental to, and should be read together with, our consolidated financial statements and the accompanying notes contained in our Annual Report on Form 10-K for the year ended October 31, 2014. Information in MD&A is intended to assist the reader in obtaining an understanding of (i) our consolidated financial statements, (ii) the changes in certain key items within those financial statements from year-to-year, (iii) the primary factors that contributed to those changes, (iv) any changes in known trends or uncertainties from items disclosed within the MD&A of our Annual Report on Form 10-K for the year ended October 31, 2014 that we are aware of and that may have a material effect on our future performance, and (v) how certain accounting principles affect our consolidated financial statements. In addition, MD&A provides information about our business segments and how the results of those segments impact our results of operations and financial condition as a whole. Operating results for interim reporting periods are not necessarily indicative of annual operating results.

Executive Overview

Navistar is an international manufacturer of International^® brand commercial and military trucks, MaxxForce^® brand diesel engines, IC Bus™ ("IC") brand school and commercial buses, as well as a provider of service parts for trucks and diesel engines. Our core business is the North American truck and parts markets, where we principally participate in the U.S. and Canada School bus and Class 6 through 8 medium and heavy trucks (our "Core" markets). We also provide retail, wholesale, and lease financing services for our trucks and parts.

Second Quarter Summary

During the second quarter of 2015, we continued to make strides with our new strategy, which centers around three key components: finishing the turnaround, establishing a leading position in the market based on an uptime advantage, and developing leaders at every level. We believe our new strategy will enable us to continue to improve our sales and market share, reduce costs, and add value for our customers, including providing a lower cost of ownership and improved fuel economy.

We also continue to evaluate our portfolio of assets, with the purpose of closing or divesting non-core/non-strategic businesses, and identifying opportunities to restructure our business and rationalize our Manufacturing operations in an effort to optimize our cost structure. We believe the new strategy, coupled with our continued focus on optimizing our cost structure, will enable us to build on our progress to-date, improve our financial performance, and achieve our long-term financial goals.

We continue to focus on our Core markets which continue to show improvements. In the second quarter of 2015, the truck industry retail deliveries for our Core markets were up 16% compared to the prior year. Our chargeouts of trucks in our Core markets were up 10%, reflecting a 24% increase in Class 6 and 7 medium trucks, a 10% increase in Class 8 severe service trucks, and a 9% increase of Class 8 heavy trucks, partially offset by a 15% decrease in school buses.

Financial Summary

Continuing Operations Results—In the second quarter of 2015, our consolidated net sales and revenues were $2.7 billion, down 2% compared to the prior year quarter. The 2% decrease reflects decreased sales in our Global Operations and Parts segments, partially offset by increased sales in our Truck segment. In the first half of 2015, our consolidated net sales and revenues were $5.1 billion, up 3% compared to the first half of 2014. The 3% increase reflects higher sales from our Truck and Parts segments, partially offset by lower sales from our Global Operations segment.

The improvement by the Truck segment reflects improved Core truck volumes, primarily Class 6 and 7 medium trucks, and an increase in our BDT joint venture, partially offset by lower export truck operations and used truck sales. The decrease in the Global Operations segment is due to lower volumes and unfavorable movements in foreign currency exchange rates in our South American engine and Brazil truck operations. The decrease in Parts segment sales in the second quarter of 2015 is primarily due to a decline in BDP and export parts sales, partially offset by improvements in our North America markets. In the first half of 2015, the Parts segment net sales increase was primarily due to improvements in our North America markets, partially offset by a decline in BDP and export parts sales.

In the second quarter and first half of 2015, we incurred a loss from continuing operations before income taxes of $39 million and $65 million, respectively, compared to a loss from continuing operations of $264 million and $516 million in the respective periods in the prior year. The improvement in our comparative results in 2015 was primarily driven by lower asset impairment charges, lower adjustments to pre-existing warranties and favorable product mix within our Core markets, partially offset by an increase in our used truck reserves. During the second quarter of 2014, we concluded certain assets were impaired and recognized a non-cash charge of $149 million, primarily related to goodwill, and established a valuation allowance on our deferred tax assets related to our Brazilian operations, which impacted income tax expense by $29 million. In addition, our

44

gross used truck inventory increased to approximately $375 million at April 30, 2015 from $320 million at October 31, 2014 (offset by reserves of $80 million and $40 million, respectively, and including approximately $3 million in our Financial Services segment, at the respective dates) due, in part, to an increase in used truck receipts coupled with a decrease in used truck sales.

In the second quarter of 2015, consolidated net income (loss) from continuing operations attributable to Navistar International Corporation, before manufacturing interest, taxes, depreciation and amortization expenses (“EBITDA”) was $85 million, compared to an EBITDA loss of $119 million in 2014. Included in our EBITDA for the second quarter of 2015 are one-time net charges of $17 million, compared to one-time charges of $201 million in the second quarter of 2014. Excluding these items, adjusted EBITDA was $102 million in the second quarter of 2015 compared to adjusted EBITDA of $82 million in 2014. In the first half of 2015, EBITDA was $186 million, compared to an EBITDA loss of $229 million in 2014. Included in our EBITDA for the first half of 2015 are certain one-time items that resulted in a net benefit of $30 million compared to charges of $274 million in the first half of 2014. Excluding these items, adjusted EBITDA was $156 million in the first half of 2015 compared to adjusted EBITDA of $45 million in 2014. EBITDA and adjusted EBITDA are not in accordance with, or an alternative for, US. GAAP. They exclude certain identified items. For more information regarding this non-GAAP financial information, see Consolidated EBITDA and Adjusted EBITDA.

In the second quarter and first half of 2015, we recognized income tax expense from continuing operations of $18 million and $25 million, respectively, compared to income tax expense of $23 million and $11 million in the respective prior periods. The difference in the income tax expense was primarily due to geographical mix and certain discrete items. The first half of 2014 included a net income tax expense of $14 million related to our Brazilian operations, offset by a tax benefit of $13 million resulting from the application of the intraperiod tax allocation rules due to the issuance and repurchase of our convertible notes and a tax benefit of $8 million due to a decrease in uncertain tax positions.

In the second quarter and first half of 2015, after income taxes, the loss from continuing operations attributable to Navistar International Corporation was $64 million and $106 million, or $0.78 and $1.30 per diluted share, compared to a loss of $298 million and $547 million, or $3.66 and $6.73 per diluted share, in the respective prior year periods.

We ended the second quarter of 2015 with $856 million of consolidated cash, cash equivalents and marketable securities, compared to $1.1 billion as of October 31, 2014. The decrease in consolidated cash, cash equivalents and marketable securities was primarily attributable to an increase in finance receivables, and decreases in accounts payable and other noncurrent liabilities, partially offset by a decrease in inventory.

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Results of Continuing Operations

The following information summarizes our Consolidated Statements of Operations and illustrates the key financial indicators used to assess our consolidated financial results.

Results of Operations for the three and six months ended April 30, 2015 as compared to the three and six months ended April 30, 2014

	Three Months Ended April 30,									% Change		Six Months Ended April 30,									% Change
(in millions, except per share data and % change)	2015			2014			Change					2015			2014			Change
Sales and revenues, net	$	2,693		$	2,746		$	(53	)	(2	)%	$	5,114		$	4,954		$	160		3	%
Costs of products sold	2,360			2,468			(108		)	(4	)%	4,405			4,482			(77		)	(2	)%
Restructuring charges	6			8			(2		)	(25	)%	9			11			(2		)	(18	)%
Asset impairment charges	1			151			(150		)	(99	)%	8			169			(161		)	(95	)%
Selling, general and administrative expenses	243			237			6			3	%	484			476			8			2	%
Engineering and product development costs	76			83			(7		)	(8	)%	155			173			(18		)	(10	)%
Interest expense	75			74			1			1	%	152			156			(4		)	(3	)%
Other (income) expense, net	(28		)	(8		)	(20		)	N.M.		(31		)	6			(37		)	N.M.
Total costs and expenses	2,733			3,013			(280		)	(9	)%	5,182			5,473			(291		)	(5	)%
Equity in income of non-consolidated affiliates	1			3			(2		)	(67	)%	3			3			—			—	%
Loss from continuing operations before income taxes	(39		)	(264		)	225			(85	)%	(65		)	(516		)	451			(87	)%
Income tax expense	(18		)	(23		)	5			(22	)%	(25		)	(11		)	(14		)	127	%
Loss from continuing operations	(57		)	(287		)	230			(80	)%	(90		)	(527		)	437			(83	)%
Less: Net income attributable to non-controlling interests	7			11			(4		)	(36	)%	16			20			(4		)	(20	)%
Loss from continuing operations(A)	(64		)	(298		)	234			(79	)%	(106		)	(547		)	441			(81	)%
Income from discontinued operations, net of tax	—			1			(1		)	N.M.		—			2			(2		)	N.M.
Net loss(A)	$	(64	)	$	(297	)	$	233		(78	)%	$	(106	)	$	(545	)	$	439		(81	)%
Diluted earnings (loss) per share:(A)
Continuing operations	$	(0.78	)	$	(3.66	)	$	2.88		(79	)%	$	(1.30	)	$	(6.73	)	$	5.43		(81	)%
Discontinued operations	—			0.01			(0.01		)	N.M.		—			0.03			(0.03		)	N.M.
	$	(0.78	)	$	(3.65	)	$	2.87		(79	)%	$	(1.30	)	$	(6.70	)	$	5.40		(81	)%
Diluted weighted average shares outstanding	81.6			81.4			0.2			—	%	81.5			81.3			0.2			—	%

_________________________

N.M. Not meaningful.

(A) Amounts attributable to Navistar International Corporation.

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Sales and revenues, net

Our sales and revenues, net, are principally generated via sales of products and services. Sales and revenues, net, by reporting segment were as follows:

	Three Months Ended April 30,									% Change		Six Months Ended April 30,									% Change
(in millions, except % change)	2015			2014			Change					2015			2014			Change
Truck	$	1,966		$	1,889		77			4	%	$	3,636		$	3,340		$	296		9	%
Parts	613			630			(17		)	(3	)%	1,239			1,216			23			2	%
Global Operations	130			271			(141		)	(52	)%	282			483			(201		)	(42	)%
Financial Services	60			57			3			5	%	120			112			8			7	%
Corporate and Eliminations	(76		)	(101		)	25			(25	)%	(163		)	(197		)	34			(17	)%
Total	$	2,693		$	2,746		$	(53	)	(2	)%	$	5,114		$	4,954		$	160		3	%

In the second quarter of 2015, the Truck segment net sales increase of $77 million, or 4%, was primarily due to improved Core truck volumes. Chargeouts from our Core market were up 10%, reflecting improvements in our Class 6 and 7 medium trucks, and our Class 8 heavy and severe service trucks. In the first half of 2015, the Truck segment net sales increase of $296 million, or 9%, was primarily due to improved Core truck volumes. Chargeouts from our Core markets were up 13%, reflecting improvements in all truck classes, and primarily Class 6 and 7 medium trucks. Also contributing to the increase in sales in the second quarter and first half of 2015 was an increase in our BDT joint venture, partially offset by a decrease in used truck sales.

In the second quarter of 2015, the Parts segment net sales decrease of $17 million, or 3%, was primarily due to a decline in BDP and export parts sales, partially offset by improvements in our North America markets. In the first half of 2015, the Parts segment net sales increase of $23 million, or 2%, was primarily due to improvements in our North America markets, partially offset by a decline in BDP and export parts sales. During the second quarter and first half of 2015, sales in the North America commercial parts channel increased by $11 million and $63 million, or 2% and 7%, compared to the respective comparable periods in 2014.

The Global Operations segment net sales decrease of $141 million and $201 million, or 52% and 42%, respectively, in the second quarter and first half of 2015, was primarily due to lower volumes and unfavorable movements in foreign currency exchange rates in our South American engine operations due to the economic downturn in Brazil, and decreased revenue in our Brazil truck operations, as the prior year included a large government order.

The Financial Services segment net revenues increased$3 million and $8 million, or 5% and 7%, respectively, in the second quarter and first half of 2015, primarily due to an increase in the average wholesale notes receivable balance, partially offset by a decline in the average retail notes receivable balance.

Costs of products sold

In the second quarter of 2015 and first half of 2015, Costs of products sold decreased by $108 million and $77 million, respectively, reflecting the impact of lower sales in our Global Operations segment and lower adjustments to pre-existing warranties, partially offset by higher sales in our Truck segment and an increase of $14 million and $31 million, respectively, in our used truck reserves. In addition, Costs of products sold throughout 2015 was favorably impacted by a shift in product mix in our Core markets.

In the second quarter and first half of 2015, the Company recognized charges for adjustments to pre-existing warranties of $18 million and a benefit for adjustments to pre-existing warranties of $39 million, compared to charges for adjustments to pre-existing warranties of $42 million and $94 million in the respective prior year periods. Included in the second quarter of 2015 warranty expense are $12 million related to field campaigns we initiated to address issues in products sold. The improvement in adjustments to pre-existing warranties throughout 2015 reflects quality improvements in recent model years and continued efforts by the Company to reduce overall cost per repair. Additionally, in the second quarter of 2014, the Truck segment recognized charges of $34 million related to the extended warranty contracts on our 2010 emission standard MaxxForce Big-Bore engines. For more information on warranty, see Note 1, Summary of Significant Accounting Policies, to the accompanying consolidated financial statements.

Restructuring Charges

We recognized restructuring charges of $6 million and $9 million, respectively, in the second quarter and first half of 2015, compared to charges of $8 million and $11 million in the respective prior year periods. In the second quarter of 2015, we incurred restructuring charges of $6 million related to cost reduction actions, including a reduction-in-force in our Global Operations segment. In the second quarter of 2014, we incurred restructuring charges of $8 million related to cost reduction

47

actions that included a reduction-in-force in the U.S. For more information, see Note 2, Restructuring and Impairments, to the accompanying consolidated financial statements.

Asset impairment charges

We recognized asset impairment charges of $1 million and $8 million, respectively, in the second quarter and first half of 2015, primarily related to certain operating leases. We recognized asset impairment charges of $151 million and $169 million, respectively, in the second quarter and first half of 2014. In the second quarter of 2014, we recognized a non-cash charge of $149 million for the impairment of certain intangible assets of our Brazilian engine reporting unit. As a result of the economic downturn in Brazil causing declines in actual and forecasted results, we tested the goodwill of our Brazilian engine reporting unit and trademark for potential impairment. As a result, we determined that the entire $142 million balance of goodwill and $7 million of trademark were impaired. For more information, see Note 1, Summary of Significant Accounting Policies, to the accompanying consolidated financial statements.

In addition, in the first half of 2014, the North America Truck segment recorded asset impairment charges of $19 million, which were the result of a triggering event relating to the determination that certain assets were held-for-sale, reflecting our ongoing evaluation of our portfolio of assets to validate their strategic and financial fit. For more information, see Note 2, Restructurings and Impairments, to the accompanying consolidated financial statements.

Selling, general and administrative expenses

The SG&A expenses increase of $6 million and $8 million in the second quarter and first half of 2015, respectively, reflects an increase in compensation expense and post-retirement related costs, partially offset by the impact of our continued cost-reduction initiatives.

Engineering and product development costs

The Engineering and product development costs decrease of $7 million and $18 million in the second quarter and first half of 2015, respectively, is primarily due to decreased spend on our SCR-related projects, partially offset by new investments in our Truck segment, particularly Class 8 trucks, vocational trucks and buses, and increased spend on projects focused on 2017 greenhouse gas ("GHG") emission integration.

Interest expense

In the second quarter of 2015, interest expense was flat compared to the second quarter of 2014. In the first half of 2015, interest expense decreased $4 million compared to the corresponding prior year period, primarily driven by a decrease in our outstanding Manufacturing operations debt balance compared to 2014.

The change in our average outstanding debt balance was primarily the result of the repurchase of a portion of our 3.00% senior subordinated convertible notes ("2014 Convertible Notes") in April 2014 and the repayment of the remainder of our 2014 Convertible Notes in October 2014, partially offset by the private sale of our 4.75% senior subordinated convertible notes due April 2019 ("2019 Convertible Notes") in April 2014.

Other (income) expense, net

We recognized Other net income of $28 million and $31 million in the second quarter and first half of 2015, respectively, compared to income of $8 million and expense of $6 million in the comparable prior periods. The income in the second quarter and first half of 2015 primarily consists of a $14 million gain related to settlement of a customer dispute, a $5 million tax credit, and gains on asset sales.

The income in the second quarter of 2014 consisted of a gain recognized due to the release of an asset retirement obligation associated with the purchase of certain leased manufacturing assets and a net favorable impact from foreign exchange rates, offset by $11 million of charges related to the repurchase of a portion of our 2014 Convertible Notes, which primarily consisted of the write-off of related discount and debt issuance costs. Additionally, the expense in the first half of 2014 included a net unfavorable impact of $17 million due to fluctuations in foreign exchange rates, particularly in the Corporate and Eliminations due to the weakening of the Canadian Dollar against the U.S. Dollar, as well as in the Global Operations segment due to the weakening of the Brazilian Real against the U.S. Dollar.

Income tax expense

In the second quarter and first half of 2015, we recognized income tax expense from continuing operations of $18 million and $25 million, respectively, compared to expense of $23 million and $11 million in the comparable prior year periods. The difference between the income tax expense in the first half of 2015 and 2014 is due to geographical mix and certain discrete items. The income tax expense in the first half of 2014 included: (i) a net expense of $14 million for tax benefits recognized on losses offset with the establishment of a valuation allowance of $29 million on our deferred tax assets related to our Brazilian operations, (ii) a tax benefit in continuing operations of $13 million resulting from the application of the intraperiod tax

48

allocation rules due to the issuance and repurchase of our convertible notes, and (iii) a tax benefit of $8 million due to the decrease in uncertain tax positions.

In the second quarter and first half of 2015, the impact of income taxes on U.S. operations was limited to current state income taxes, and other discrete items, due in part to the deferred tax valuation allowances on our U.S. deferred tax assets.

At October 31, 2014, we had $2.7 billion of U.S. federal net operating losses and $240 million of federal tax credit carryforwards. We expect our cash payments of U.S. taxes will be minimal for as long as we are able to offset our U.S. taxable income by these U.S. net operating losses and tax credits, which have carryforward periods of up to 20 years. We also have U.S. state and foreign net operating losses that are available to reduce cash payments in future periods. We maintain valuation allowances on our U.S. and certain foreign deferred tax assets because it is more-likely-than-not those deferred tax assets will not be realized. It is reasonably possible within the next twelve months that an additional valuation allowance may be required on certain foreign deferred tax assets. For more information, see Note 8, Income Taxes, to the accompanying consolidated financial statements.

Net income attributable to non-controlling interests

Net income attributable to non-controlling interests is the result of our consolidation of subsidiaries that we do not wholly own. Substantially all of our net income attributable to non-controlling interests in 2015 and 2014 relates to Ford's non-controlling interest in BDP.

Segment Results of Continuing Operations

We define segment profit (loss) as net income (loss) from continuing operations attributable to NIC excluding income tax benefit (expense). The following sections analyze operating results as they relate to our four segments and do not include intersegment eliminations. For additional information concerning our segments, see Note 12, Segment Reporting, to the accompanying consolidated financial statements.

Truck Segment

	Three Months Ended April 30,								% Change		Six Months Ended April 30,								% Change
(in millions, except % change)	2015			2014			Change				2015			2014			Change
Truck segment sales, net	$	1,966		$	1,889		$	77	4	%	$	3,636		$	3,340		$	296	9	%
Truck segment loss	(51		)	(129		)	78		(60	)%	(69		)	(337		)	268		(80	)%

Segment sales

In the second quarter of 2015, the Truck segment net sales increase of $77 million, or 4%, was primarily due to improved Core truck volumes. Truck chargeouts from our Core markets were up 10%, reflecting a 24% increase in Class 6 and 7 medium trucks, a 10% increase in Class 8 severe service trucks, and a 9% increase in Class 8 heavy trucks, partially offset by a 15% decrease in school buses. Also contributing to the increase in sales in the second quarter of 2015 is an increase in our BDT joint venture, partially offset by a decline in our export truck operations, particularly in Colombia, and lower volumes in our used truck operations. On May 29, 2015, we acquired all of Ford's remaining 25% ownership in the BDT joint venture. For more information on the BDT joint venture, see Note 1, Summary of Significant Accounting Policies, to the accompanying consolidated financial statements.

In the first half of 2015, the Truck segment net sales increase of $296 million, or 9%, was primarily due to improved Core truck volumes. Truck chargeouts from our Core markets were up 13%, reflecting a 24% increase in Class 6 and 7 medium trucks, a 10% increase in Class 8 severe service trucks, an 8% increase in Class 8 heavy trucks, and a 6% increase in school buses. Also contributing to the increase in sales in the first half of 2015 is an increase in our BDT joint venture, partially offset by a decline in our used truck operations.

Segment loss

In the second quarter and first half of 2015, the Truck segment improved its segment loss by $78 million and $268 million, respectively, primarily driven by lower charges for adjustments to pre-existing warranties. In the second quarter and first half of 2015, the Truck segment recorded charges for adjustments to pre-existing warranties of $19 million and a benefit for adjustments to pre-existing warranties of $36 million, respectively, compared to charges of $42 million and $93 million, respectively, in comparable prior year periods. The change in adjustments to pre-existing warranties reflects quality improvements in recent model years and continued efforts by the Company to reduce overall cost per repair. In addition, gross margin throughout 2015 was favorably impacted by a shift in product mix in our Core markets, partially offset by an increase in charges for our used truck reserves of $14 million and $31 million in the second quarter and first half of 2015, respectively.

Selling, general and administrative ("SG&A") expenses and Engineering and product development costs continued to decline.

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The lower SG&A expenses reflect the impact of our cost-reduction initiatives. The lower Engineering and product development costs were primarily due to decreased spending on our SCR-related projects, partially offset by new investments in our Truck segment, particularly Class 8 trucks, vocational trucks and buses, and increased spend on projects focused on 2017 GHG emission integration.

Additionally, in the first half of 2015, the segment recorded asset impairment charges of $8 million, compared to $19 million in the first half of 2014. The charges in 2015 were for certain operating leases, while the charges in 2014 were for certain intangible and long-lived assets and reflect our ongoing evaluation of our portfolio of assets to validate their strategic and financial fit. For more information on the other asset impairment charges, see Note 2, Restructurings and Impairments, to the accompanying consolidated financial statements.

Offsetting these factors were certain other charges. The segment incurred accelerated depreciation charges of $12 million and $25 million in the second quarter and first half of 2015, respectively, for certain assets related to the foundry facilities. For more information, see Note 2, Restructurings and Impairments, to the accompanying consolidated financial statements.

Parts Segment

	Three Months Ended April 30,							% Change		Six Months Ended April 30,						% Change
(in millions, except % change)	2015		2014		Change					2015		2014		Change
Parts segment sales, net	$	613	$	630	$	(17	)	(3	)%	$	1,239	$	1,216	$	23	2	%
Parts segment profit	133		133		—			—	%	278		241		37		15	%

Segment sales

In the second quarter of 2015, the Parts segment net sales decrease of $17 million, or 3%, is due to a decline in BDP and export parts sales, partially offset by improvements in our North America markets. In the first half of 2015, the Parts segment net sales increase of $23 million, or 2%, is due to improvements in our North America markets, partially offset by a decline in BDP and export parts sales. During the second quarter and first half of 2015, sales in the North America commercial parts channel increased by $11 million and $63 million, or 2% and 7%, respectively, compared to respective prior year periods.

Segment profit

In the second quarter of 2015, Parts segment profit was flat compared to 2014, as margin improvements in our commercial markets and lower intercompany "access fees" were offset by the decrease in net sales. In the first half of 2015, the increase in the Parts segment profit of $37 million was primarily due to margin improvements in our commercial markets and, to a lesser extent, lower intercompany "access fees". Access fees are allocated to the Parts segment from the Truck segment, primarily for development of new products, and consist of certain engineering and product development costs, depreciation expense, and SG&A. The lower fees in 2015 are due to cost-reduction initiatives in the Truck segment.

Global Operations Segment

	Three Months Ended April 30,								% Change		Six Months Ended April 30,									% Change
(in millions, except % change)	2015		2014			Change					2015			2014			Change
Global Operations segment sales, net	$	130	$	271		$	(141	)	(52	)%	$	282		$	483		$	(201	)	(42	)%
Global Operations segment profit (loss)	1		(162		)	163			N.M.		(14		)	(197		)	183			(93	)%

Segment sales

In the second quarter and first half of 2015, the Global Operations segment net sales decrease of $141 million and $201 million, respectively, was driven by a decrease of $111 million and $147 million, respectively, in our South America engine operations, reflecting lower volumes and unfavorable movements in foreign currency exchange rates. The continued economic downturn in the Brazil economy has contributed to lower engine volumes of 48% and 34%, respectively, in the second quarter and first half of 2015 compared to the comparable prior year. The decrease in 2015 was also attributable to a decrease in revenue from our Brazil truck operations, as the prior year included a large government order.

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Segment profit (loss)

In the second quarter and first half of 2015, the Global Operations segment results improved by $163 million and $183 million, respectively, primarily due to non-cash charges of $149 million for the impairment of the goodwill of our Brazilian engine reporting unit and the related trademark during the second quarter of 2014. As a result of the economic downturn in Brazil causing declines in actual and forecasted results, we tested the goodwill of our Brazilian engine reporting unit and trademark for potential impairment. As a result, we determined that the entire $142 million balance of goodwill and $7 million of trademark were impaired.

Excluding the impact of the prior year impairment, the Global Operations segment results improved by $14 million and $34 million in the second quarter and first half of 2015, respectively. The results in both periods in 2015 reflect a $10 million net gain related to a settlement of a customer dispute. The remaining improvements in the segment are primarily due to lower manufacturing and structural costs as a result of our restructuring and cost-reduction efforts, partially offset by the decreased results of our Brazil truck operations, including a $6 million inventory charge related to our efforts to right-size the truck business due to the current economic conditions in Brazil.

Financial Services Segment

	Three Months Ended April 30,							% Change		Six Months Ended April 30,							% Change
(in millions, except % change)	2015		2014		Change					2015		2014		Change
Financial Services segment revenues, net	$	60	$	57	$	3		5	%	$	120	$	112	$	8		7	%
Financial Services segment profit	22		24		(2		)	(8	)%	46		47		(1		)	(2	)%

Segment revenues

In the second quarter and first half of 2015, net revenues in the Financial Services segment increased by $3 million and $8 million, or 5% and 7%, respectively, primarily driven by an increase in the average wholesale notes receivable balance, partially offset by a decline in the average retail notes receivable balance. The decline in the average retail notes receivable balance is primarily due to the continued liquidation of our U.S. retail portfolio.

Segment profit

In the second quarter and first half of 2015, the Financial Services segment profit was comparable to the prior year as the increase in revenue was offset by an increase in provision for loan losses in Mexico due to a decline in portfolio quality of the retail portfolio, the suspension of revenue on certain impaired operating leases, and lower interest income from intercompany loans.

Supplemental Information

The following tables provide additional information on truck industry retail units, market share data, order units, backlog units, chargeout units, and engine shipments. These tables present key metrics and trends that provide quantitative measures on the performance of the Truck and Global Operations segments.

Truck Industry Retail Deliveries

The following table summarizes approximate industry retail deliveries, for our Core truck market, categorized by relevant class, according to Wards Communications and R.L. Polk & Co. ("Polk"):

	Three Months Ended April 30,			% Change		Six Months Ended April 30,			% Change
(in units)	2015	2014	Change			2015	2014	Change
Core Markets (U.S. and Canada)
School buses	4,400	3,900	500	13	%	10,100	9,200	900	10	%
Class 6 and 7 medium trucks	20,000	19,500	500	3	%	38,000	35,200	2,800	8	%
Class 8 heavy trucks	51,700	42,600	9,100	21	%	102,100	85,200	16,900	20	%
Class 8 severe service trucks	14,700	12,000	2,700	23	%	29,000	24,100	4,900	20	%
Total Core markets	90,800	78,000	12,800	16	%	179,200	153,700	25,500	17	%
Combined class 8 trucks	66,400	54,600	11,800	22	%	131,100	109,300	21,800	20	%
Navistar Core retail deliveries	15,500	14,600	900	6	%	28,500	26,700	1,800	7	%

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Truck Retail Delivery Market Share

The following table summarizes our approximate retail delivery market share percentages for the Class 6 through 8 U.S. and Canada truck markets, based on market-wide information from Wards Communications and Polk:

	Three Months Ended
	April 30, 2015		January 31, 2015		October 31, 2014		July 31, 2014		April 30, 2014
Core Markets (U.S. and Canada)
Class 6 and 7 medium trucks	27	%	21	%	19	%	20	%	26	%
Class 8 heavy trucks	12	%	10	%	15	%	14	%	14	%
Class 8 severe service trucks	15	%	14	%	14	%	15	%	17	%
Combined class 8 trucks	13	%	11	%	15	%	14	%	15	%

Truck Orders, net

We define orders as written commitments received from customers and dealers during the year to purchase trucks. Net orders represent new orders received during the year less cancellations of orders made during the same year. Orders do not represent guarantees of purchases by customers or dealers and are subject to cancellation. Orders may be either sold orders, which will be built for specific customers, or stock orders, which will generally be built for dealer inventory for eventual sale to customers. These orders may be placed at our assembly plants in the U.S. and Mexico for destinations anywhere in the world and include trucks and buses. Historically, we have had an increase in net orders for stock inventory from our dealers at the end of the year due to a combination of demand and, from time to time, incentives to the dealers. Increases in stock orders typically translate to higher future chargeouts. The following table summarizes our approximate net orders for Core units:

	Three Months Ended April 30,				% Change		Six Months Ended April 30,				% Change
(in units)	2015	2014	Change				2015	2014	Change
Core Markets (U.S. and Canada)
School buses	3,500	2,900	600		21	%	6,000	5,200	800		15	%
Class 6 and 7 medium trucks	4,400	6,000	(1,600	)	(27	)%	9,000	10,300	(1,300	)	(13	)%
Class 8 heavy trucks	5,600	9,200	(3,600	)	(39	)%	13,700	14,800	(1,100	)	(7	)%
Class 8 severe service trucks	2,800	2,300	500		22	%	4,800	4,600	200		4	%
Total Core Markets	16,300	20,400	(4,100	)	(20	)%	33,500	34,900	(1,400	)	(4	)%
Combined class 8 trucks	8,400	11,500	(3,100	)	(27	)%	18,500	19,400	(900	)	(5	)%

Truck Backlogs

We define order backlogs ("backlogs") as orders yet to be built as of the end of the period. Our backlogs do not represent guarantees of purchases by customers or dealers and are subject to cancellation. Although the backlog of unbuilt orders is one of many indicators of market demand, other factors such as changes in production rates, internal and supplier available capacity, new product introductions, and competitive pricing actions may affect point-in-time comparisons. Backlogs exclude units in inventory awaiting additional modifications or delivery to the end customer. The following table summarizes our approximate backlog for Core units:

	As of April 30,				% Change
(in units)	2015	2014	Change
Core Markets (U.S. and Canada)
School buses	3,000	3,400	(400	)	(12	)%
Class 6 and 7 medium trucks	5,500	6,200	(700	)	(11	)%
Class 8 heavy trucks	13,800	12,800	1,000		8	%
Class 8 severe service trucks	2,700	2,500	200		8	%
Total Core Markets	25,000	24,900	100		—	%
Combined class 8 trucks	16,500	15,300	1,200		8	%

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Truck Chargeouts

We define chargeouts as trucks that have been invoiced to customers. The units held in dealer inventory represent the principal difference between retail deliveries and chargeouts. The following table summarizes our approximate worldwide chargeouts from our continuing operations:

	Three Months Ended April 30,				% Change		Six Months Ended April 30,				% Change
(in units)	2015	2014	Change				2015	2014	Change
Core Markets (U.S. and Canada)
School buses	2,300	2,700	(400	)	(15	)%	5,000	4,700	300		6	%
Class 6 and 7 medium trucks	6,700	5,400	1,300		24	%	10,700	8,600	2,100		24	%
Class 8 heavy trucks	7,300	6,700	600		9	%	12,100	11,200	900		8	%
Class 8 severe service trucks	2,300	2,100	200		10	%	4,300	3,900	400		10	%
Total Core Markets	18,600	16,900	1,700		10	%	32,100	28,400	3,700		13	%
Non "core" military	—	100	(100	)	—	%	—	100	(100	)	—	%
Other markets(A)	5,400	6,700	(1,300	)	(19	)%	12,400	12,100	300		2	%
Total worldwide unit	24,000	23,700	300		1	%	44,500	40,600	3,900		10	%
Combined class 8 trucks	9,600	8,800	800		9	%	16,400	15,100	1,300		9	%

_____________________________

(A) Other markets primarily consist of Export Truck and Mexico and also includes chargeouts related to BDT of 2,600 units and 2,100 units during the three months ended April 30, 2015 and 2014, respectively, and 6,000 and 4,500 during the six months ended April 30, 2015 and 2014.

Engine Shipments

	Three Months Ended April 30,				% Change		Six Months Ended April 30,				% Change
(in units)	2015	2014	Change				2015	2014	Change
OEM sales-South America	11,600	24,500	(12,900	)	(53	)%	27,300	44,900	(17,600	)	(39	)%
Intercompany sales	7,000	10,100	(3,100	)	(31	)%	13,600	19,600	(6,000	)	(31	)%
Other OEM sales	2,600	2,900	(300	)	(10	)%	5,500	5,300	200		4	%
Total sales	21,200	37,500	(16,300	)	(43	)%	46,400	69,800	(23,400	)	(34	)%

Liquidity and Capital Resources

	As of
(in millions)	April 30, 2015		October 31, 2014		April 30, 2014
Consolidated cash and cash equivalents	$	583	$	497	$	594
Consolidated marketable securities	273		605		534
Consolidated cash, cash equivalents and marketable securities	$	856	$	1,102	$	1,128

Cash Requirements

We generate cash flow from the sale of trucks, diesel engines, and parts, as well as from product financing provided to our dealers and retail customers by our Financial Services operations. It is our opinion that, in the absence of significant extraordinary cash demands, our: (i) level of cash, cash equivalents, and marketable securities, and (ii) current and forecasted cash flow from our Manufacturing operations, Financial Services operations, and financing capacities, will provide sufficient funds to meet operating requirements, capital expenditures, equity investments, and financial obligations during the next twelve months. We also believe that collections on our outstanding receivables portfolios, as well as funds available from various funding sources, will permit our Financial Services operations to meet the financing requirements of our dealers.

Our Manufacturing operations are generally able to access sufficient sources of financing to support our business plan. In July 2014, our amended and restated asset-based credit agreement in an aggregate principal amount of $175 million (the "Amended and Restated Asset-Based Credit Facility") was amended to remove used truck inventory from the borrowing base. The

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amendment had no impact on the aggregate commitment level under the Amended and Restated Asset-Based Credit Facility, which remains at $175 million. Additionally, the calculation of availability was revised to include cash collateral posted to support outstanding designated letters of credit, subject to a $40 million cap, and the cash management provisions were amended to reflect intercreditor arrangements with respect to a financing with NFC secured by a first priority lien on used truck inventory (and certain related assets) (the "Intercompany Used Truck Loan"). During 2014, NFC made secured intercompany loans to our Manufacturing operations under the Intercompany Used Truck Loan of $181 million. During the first half of 2015, we increased our borrowings under the Intercompany Used Truck Loan by $42 million to $223 million and also received $125 million in dividends from NFC. $80 million of the dividends paid by NFC were funded by the partial repayment of an intercompany loan to NFC and were therefore cash neutral to NFC and NIC.

During the second quarter of 2014, the Company completed the private sale of $411 million of our 2019 Convertible Notes, including a portion of the underwriters' over-allotment options. The Company used the net proceeds from our 2019 Convertible Notes, as well as cash on-hand, to repurchase $404 million of notional amount of our 2014 Convertible Notes. In conjunction with the repurchases, the Company unwound a portion of the call options and warrants associated with the repurchased 2014 Convertible Notes. During the fourth quarter of 2014, the Company repaid the remainder of the 2014 Convertible Notes and the remaining purchased call options expired worthless.

Consolidated cash, cash equivalents and marketable securities was $856 million at April 30, 2015, which includes $87 million of cash and cash equivalents attributable to BDT and BDP, as well as an immaterial amount of cash and cash equivalents of certain VIEs that is generally not available to satisfy our obligations. For additional information on the consolidation of BDT and BDP, see Note 1, Summary of Significant Accounting Policies, to the accompanying consolidated financial statements.

Cash Flow Overview 

	Six Months Ended April 30, 2015
(in millions)	Manufacturing Operations			Financial Services Operations and Adjustments			Condensed Consolidated Statement of Cash Flows
Net cash used in operating activities	$	(32	)	$	(205	)	$	(237	)
Net cash provided by investing activities	295			37			332
Net cash provided by (used in) financing activities	(132		)	149			17
Effect of exchange rate changes on cash and cash equivalents	(35		)	9			(26		)
Increase (decrease) in cash and cash equivalents	96			(10		)	86
Cash and cash equivalents at beginning of the period	440			57			497
Cash and cash equivalents at end of the period	$	536		$	47		$	583

	Six Months Ended April 30, 2014
(in millions)	Manufacturing Operations			Financial Services Operations and Adjustments			Condensed Consolidated Statement of Cash Flows
Net cash provided by (used in) operating activities	$	(341	)	$	15		$	(326	)
Net cash provided by (used in) investing activities	224			(82		)	142
Net cash provided by (used in) financing activities	(36		)	69			33
Effect of exchange rate changes on cash and cash equivalents	(11		)	1			(10		)
Increase (decrease) in cash and cash equivalents	(164		)	3			(161		)
Cash and cash equivalents at beginning of the period	727			28			755
Cash and cash equivalents at end of the period	$	563		$	31		$	594

_____________________

Manufacturing operations cash flows and Financial Services operations cash flows are not in accordance with, or an alternative for, GAAP. This non-GAAP financial information should be considered supplemental to, and not as a substitute for, or superior to, financial measures calculated in accordance with GAAP. However, we believe that non-GAAP reporting, giving effect to the adjustments shown in the reconciliation above, provides meaningful information and therefore we use it to supplement our GAAP reporting by identifying items that may not be related to the core manufacturing business. Management often uses this information to assess and measure the performance and liquidity of our operating segments. Our Manufacturing operations, for this purpose, include our Truck segment, Global Operations segment, Parts segment, and Corporate items which include certain eliminations. The reconciling differences between these non-GAAP financial measures and our GAAP consolidated financial statements in Item 1, Financial Statements and Supplementary Data, are our Financial Services operations and adjustments required to eliminate certain intercompany transactions between Manufacturing operations and Financial Services operations. Our Financial Services operations cash flows are presented consistent with their treatment in our Condensed Consolidated Statements of Cash Flows and may not be consistent with how they would be treated on a stand-alone basis. We have chosen to provide this supplemental information to allow additional analysis of operating results, to illustrate the respective cash flows giving effect to the non-GAAP adjustments shown in the above reconciliation and to provide an additional measure of performance and liquidity.

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Manufacturing Operations

Manufacturing Operations Cash Flow from Operating Activities

Cash used in operating activities was $32 million and $341 million in the six months ended April 30, 2015 and 2014, respectively. The improvement in cash flow from operating activities in 2015 compared to 2014 was primarily attributable to a lower net loss, dividends received from NFC, and a decrease in inventories, partially offset by lower collections of accounts receivable, higher accounts payable payments and changes in other noncurrent liabilities.

Cash paid for interest, net of amounts capitalized, was $94 million and $104 million in the six months ended April 30, 2015 and 2014, respectively.

Manufacturing Operations Cash Flow from Investing Activities

Cash provided by investing activities was$295 million and $224 million in the six months ended April 30, 2015 and 2014, respectively. The net increase in cash flow from investing activities in 2015 compared to 2014 was primarily attributable to lower purchases of equipment leased to others and lower purchases of marketable securities.

Manufacturing Operations Cash Flow from Financing Activities

Cash used in financing activities was $132 million and $36 million in the six months ended April 30, 2015 and 2014, respectively. The net decrease in cash flow from financing activities in 2015 compared to 2014 was primarily attributable to a partial repayment of an intercompany loan due to our Financial Services operations and lower proceeds from the exercise of employee stock options.

Financial Services Operations

Financial Services Operations and Adjustments to Cash Flow from Operating Activities

Cash used in operating activities was $205 million in the six months ended April 30, 2015, compared to cash provided by operating activities of $15 million in the six months ended April 30, 2014. The decrease in cash flow from operating activities was primarily due to the payment of dividends to the Manufacturing operations and an increase in originations of wholesale receivables.

Cash paid for interest, net of amounts capitalized, was $31 million in the six months ended April 30, 2015, compared to $27 million in the six months ended April 30, 2014. The increase was due to the higher average borrowing levels needed to fund the increase in average finance receivables.

Financial Services Operations and Adjustments to Cash Flow from Investing Activities

Cash provided by investing activities was $37 million in the three months ended April 30, 2015, compared to cash used in investing activities of $82 million in the same period of 2014. Changes in restricted cash levels required under our secured borrowings were the primary sources and uses of cash from investing activities in 2015 and 2014, along with purchases of equipment leased to others. In 2015, restricted cash was liquidated in conjunction with the repayment of investor notes which matured in January 2015, and the repayment of the retail securitization in December 2014. Also, purchases of equipment leased to others declined.

Financial Services Operations and Adjustments to Cash Flow from Financing Activities

Cash provided by financing activities was $149 million and $69 million in the six months ended April 30, 2015 and 2014, respectively. The increase was primarily due to the higher funding requirements for the increase in originations of wholesale receivables and an increase in borrowings used for the secured intercompany loan.

Consolidated EBITDA and Adjusted EBITDA

EBITDA and Adjusted EBITDA, which excludes certain identified items that we do not consider to be part of our ongoing business, are not in accordance with, or an alternative for, U.S. GAAP. This non-GAAP financial information should be considered supplemental to, and not as a substitute for, or superior to, financial measures calculated in accordance with U.S. GAAP.

We believe EBITDA provides meaningful information about the performance of our business and therefore we use it to supplement our U.S. GAAP reporting. We believe that Adjusted EBITDA improves the comparability of year-to-year results, and is representative of our underlying performance. Management uses this information to assess and measure the performance

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of our operating segments. We have chosen to provide this supplemental information to investors, analysts and other interested parties to enable them to perform additional analyses of operating results, to illustrate the results of operations giving effect to the non-GAAP adjustments shown in the below reconciliations, and to provide an additional measure of performance.

EBITDA reconciliation:

	Three Months Ended April 30,						Six Months Ended April 30,
(in millions)	2015			2014			2015			2014
Loss from continuing operations attributable to NIC, net of tax	$	(64	)	$	(298	)	$	(106	)	$	(547	)
Plus:
Depreciation and amortization expense	74			99			153			185
Manufacturing interest expense(A)	57			57			114			122
Less:
Income tax benefit (expense)	(18		)	(23		)	(25		)	(11		)
EBITDA	$	85		$	(119	)	$	186		$	(229	)

______________________

(A) Manufacturing interest expense is the net interest expense primarily generated for borrowings that support the manufacturing and corporate operations, adjusted to eliminate intercompany interest expense with our Financial Services segment. The following table reconciles Manufacturing interest expense to the consolidated interest expense:

	Three Months Ended April 30,				Six Months Ended April 30,
(in millions)	2015		2014		2015		2014
Interest expense	75		74		152		156
Less: Financial services interest expense	18		17		38		34
Manufacturing interest expense	$	57	$	57	$	114	$	122

Adjusted EBITDA Reconciliation:

	Three Months Ended April 30,						Six Months Ended April 30,
(in millions)	2015			2014			2015			2014
EBITDA (reconciled above)	$	85		$	(119	)	$	186		$	(229	)
Less significant items of:
Adjustments to pre-existing warranties(A)	18			42			(39		)	94
Restructuring charges(B)	2			8			5			11
Asset impairment charges(C)	1			151			8			169
Gain on settlement(D)	(10		)	—			(10		)	—
Brazil truck business actions(E)	6			—			6			—
Total adjustments	17			201			(30		)	274
Adjusted EBITDA	$	102		$	82		$	156		$	45

______________________

(A) Adjustments to pre-existing warranties reflect changes in our estimate of warranty costs for products sold in prior periods.

(B) In the second quarter of 2014, we incurred restructuring charges of $8 million related to cost reduction actions that included a reduction-in-force in the U.S.

(C) In the second quarter of 2014, we recognized a non-cash charge of $149 million for the impairment of certain intangible assets of our Brazilian engine reporting unit. Due to slower than expected growth in the Brazilian economy causing declines in actual and forecasted results, we tested the goodwill of our Brazilian engine reporting unit and trademark for potential impairment. As a result, we determined that the entire $142 million balance of goodwill and $7 million of trademark were impaired. Additionally, in the first quarter of 2014, the Company concluded it had a triggering event related to potential sales of assets requiring assessment of impairment for certain intangible and long-lived assets in the Truck segment. As a result, the Truck segment recognized asset impairment charges of $18 million.

(D) In the second quarter of 2015, the Global Operations segment recognized a $10 million net gain related to a settlement of a customer dispute. The $10 million net gain for the settlement included restructuring charges of $4 million.

(E) In the second quarter and first half of 2015 our Global Operations segment recorded $6 million in inventory charges to right size the Brazil Truck business.

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Pension and Other Postretirement Benefits

The Company’s pension plans are funded by contributions made from Company assets in accordance with applicable U.S. and Canadian government regulations. The regulatory funding requirements are computed using an actuarially determined funded status, which is determined using assumptions that often differ from assumptions used to measure the funded status for U.S. GAAP. U.S. funding targets are determined by rules promulgated under the Pension Protection Act of 2006 (the "PPA"). The PPA additionally requires underfunded plans to achieve 100% funding over a period of time. From time to time, we have discussions with and receive requests for certain information from the Pension Benefit Guaranty Corporation ("PBGC"). The PBGC was created by ERISA to encourage the continuation and maintenance of private-sector defined benefit pension plans, provide timely and uninterrupted payment of pension benefits, and keep pension insurance premiums at a minimum. In July 2012, the Moving Ahead for Progress in the 21^st Century Act (the "MAP-21 Act") was signed into law, impacting the minimum funding requirements for pension plans, but not otherwise impacting our accounting for pension benefits. In August 2014, the HATFA, including extension of pension funding interest rate relief, was signed into law. As a result, we lowered our funding expectations.

Generally, our pension plans are funded by contributions made by us. Our policy is to fund the pension plans in accordance with applicable U.S. and Canadian government regulations and to make additional contributions from time to time.

For the three and six months ended April 30, 2015, we contributed $32 million and $62 million respectively, and for the three and six months ended April 30, 2014, we contributed $36 million and $65 million, respectively, to our U.S. and Canadian pension plans (the "Plans") to meet regulatory minimum funding requirements. We currently anticipate additional contributions of approximately $51 million during the remainder of 2015. Future contributions are dependent upon a number of factors, principally the changes in values of plan assets, changes in interest rates, the impact of any future funding relief, and the impact of funding resulting from the closure of our Chatham plant. We currently expect that from 2016 through 2018, the Company will be required to contribute at least $100 million per year to the Plans, depending on asset performance and discount rates.

For more information, see Note 7, Postretirement Benefits, to the accompanying consolidated financial statements.

Other Information

Impact of Environmental Regulation

Government regulation related to climate change is under consideration at the U.S. federal and state levels. Because our products use fossil fuels, they may be impacted indirectly due to regulation, such as a cap and trade program, affecting the cost of fuels. The EPA and the United States National Highway Traffic Safety Administration ("NHTSA") issued final rules for greenhouse ("GHG") emissions and fuel economy on September 15, 2011. These began to apply in calendar year 2014 and will be fully implemented in model year 2017. The agencies' stated goals for these rules were to increase the use of currently existing technologies. The Company is complying with these rules through use of existing technologies and implementation of emerging technologies as they become available. Several of the Company's vehicles were certified early for the 2013 model year and the majority of our remaining vehicles and all engines were certified in 2014. The next phase of federal GHG emission and fuel economy regulations, anticipated for 2020 or later, is also under discussion among the relevant agencies, manufacturers, including the Company, and other stakeholders. Canada adopted its version of fuel economy and/or GHG emission regulations in February 2013. These regulations are substantially aligned with U.S. fuel economy and GHG emission regulations. In December 2014, California has adopted GHG emission rules for heavy duty vehicles equivalent to federal EPA rules and an optional lower emission standard for nitrogen oxide ("NOx") in California. We expect that heavy duty vehicle and engine fuel economy and GHG emissions rules will be under consideration in other global jurisdictions in the future. These standards will impact development and production costs for vehicles and engines. There will also be administrative costs arising from the implementation of the rules. EPA also issued a proposed rule in December 2014 that would lower the National Ambient Air Quality Standard for ozone.  If adopted this could lead to future lower emission standards for substances that contribute to ozone, including NOx from vehicles, at the federal and state levels.

Our facilities may be subject to regulation related to climate change and climate change itself may also have some impact on the Company's operations. However, these impacts are currently uncertain and the Company cannot predict the nature and scope of those impacts.

Critical Accounting Policies and Estimates

Our consolidated financial statements are prepared in accordance with U.S. GAAP. In connection with the preparation of our consolidated financial statements, we use estimates and make judgments and assumptions about future events that affect the reported amounts of assets, liabilities, revenue, expenses, and the related disclosures. Our assumptions, estimates, and judgments are based on historical experience, current trends, and other factors we believe are relevant at the time we prepare our consolidated financial statements.

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Our significant accounting policies and critical accounting estimates are consistent with those discussed in Note 1, Summary of Significant Accounting Policies, to the consolidated financial statements and the MD&A section of our Annual Report on Form 10-K for the year ended October 31, 2014. During the six months ended April 30, 2015, there were no significant changes in our application of our critical accounting policies.

To aid in fully understanding and evaluating our reporting results, we have identified the following accounting policies as our most critical because they require us to make difficult, subjective, and complex judgments:

• Pension and Other Postretirement Benefits

• Allowance for Doubtful Accounts

• Income Taxes

• Impairment of Long-Lived Assets

• Goodwill

• Indefinite-Lived Intangible Assets

• Contingency Accruals

Recently Issued and Adopted Accounting Standards

In the quarter ended April 30, 2015, the Company has not adopted any new accounting guidance that has had a material impact on our consolidated financial statements.

In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606), which supersedes the revenue recognition requirements in ASC 605, Revenue Recognition.  This ASU is based on the principle that revenue is recognized to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services.  The ASU also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract. This new guidance is effective for annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period. Early adoption is not permitted. Our effective date is November 1, 2017. On April 29, 2015 the FASB issued an exposure draft of a proposed ASU that would delay by one year the effective date of ASU 2014-09 and allow early adoption as of the original effective date. The changes to the effective date and early adoption are still subject to final approval. We are currently evaluating the impact and method of adoption of this ASU on our consolidated financial statements.

Item 3.     Quantitative and Qualitative Disclosures about Market Risk

See Item 7A, Quantitative and Qualitative Disclosures about Market Risk, of our Annual Report on Form 10-K for the year ended October 31, 2014. During six months ended April 30, 2015, there have been no significant changes in our exposure to market risk.

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Item 4.Controls and Procedures

(a) Evaluation of Disclosure Controls and Procedures

Disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) are designed to ensure that information required to be disclosed in reports filed or submitted under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the SEC rules and forms, and that such information is accumulated and communicated to management, including our Chief Executive Officer and the Chief Financial Officer, to allow timely decisions regarding required disclosures.

As previously disclosed under “Item 9A-Controls and Procedures” in our Annual Report on Form 10-K for our fiscal year ended October 31, 2014, we concluded that our disclosure controls and procedures were not effective as of October 31, 2014 based on the material weakness identified. Based on the material weakness, which we continue to work to remediate and view as an integral part of our disclosure controls and procedures, our Chief Executive Officer and Chief Financial Officer have concluded that, as of the quarter ended April 30, 2015, our disclosure controls and procedures were not effective. In light of the weaknesses in internal control over financial reporting, prior to filing our Annual Report on Form 10-K for our fiscal year ended October 31, 2014, and prior to filing this Quarterly Report on Form 10-Q for the fiscal quarter ended April 30, 2015, we completed substantive procedures, including, validating, and in certain cases correcting, the completeness and accuracy of the underlying data used for warranty costs estimates and other significant accounting estimates and transactions. These substantive procedures have allowed us to conclude that, notwithstanding the material weakness in our internal control over financial reporting described below, the condensed consolidated financial statements in this Quarterly Report on Form 10-Q fairly present, in all material respects, our financial position, results of operations, and cash flows for the periods presented in conformity with U.S. GAAP.

The material weakness in our internal control over financial reporting, which is described more fully in our Annual Report on Form 10-K for the fiscal year ended October 31, 2014 and continued to exist as of April 30, 2015, is as follows:

• We do not have sufficient controls designed to validate the completeness and accuracy of underlying data used in the determination of significant estimates and accounting transactions. Specifically, controls were not designed to identify errors in the underlying data which was used to calculate warranty cost estimates and other significant accounting estimates and the accounting effects of significant transactions. This material weakness resulted in the recording of adjustments to the warranty reserve and related expense accounts and there is a reasonable possibility that a material misstatement of our financial statements will not be prevented or detected on a timely basis.

Management’s Remediation Initiatives

We continue to invest significant time and effort to address the material weakness related to the completeness and accuracy of underlying data used in the determination of significant estimates and the accounting effects of significant transactions. Specifically, the following actions were taken:

• Critical management review controls were enhanced to increase the precision of management's reviews and these reviews were expanded to validate the completeness and accuracy of the reports and data used in the operation of the controls.

• Controls were designed and implemented to validate the completeness and accuracy of the inputs and outputs for significant accounting estimates and transactions.

• Stronger system interface controls were implemented to verify the complete and accurate flow of data between systems used for the significant accounting estimates and transactions.

• We increased our investment in human capital and information technology to improve the controls over completeness and accuracy.

While progress has been made, there are still more controls that need to be implemented or existing controls to be enhanced to ensure that a material misstatement in our financial statements would be prevented or detected on a timely basis.

In addition to the actions already taken, the actions summarized below, are intended to fully remediate the material weakness and to continue to enhance our internal control over financial reporting:

• We will continue to design, document, and test controls that are intended to validate the completeness and accuracy of the data used for significant accounting estimates and transactions.

• Until full remediation is complete, we will continue to perform substantive procedures, including, validating, and in certain cases correcting, the completeness and accuracy of the underlying data used for significant accounting estimates and transactions to ensure that, in all material respects, our financial statements are presented in conformity with U.S. GAAP.

59

Although more time is needed to design, implement and demonstrate effectiveness of the aforementioned internal controls, the efforts summarized are intended to continue to enhance our internal control over financial reporting.

(b) Changes in Internal Control over Financial Reporting

We are taking actions to remediate the material weakness related to our internal control over financial reporting, as described above. However, our remediation efforts were not complete as of April 30, 2015. Other than the changes disclosed above, there were no material changes in our internal control over financial reporting identified in connection with the evaluation required by Rules 13a-15 and 15d-15 under the Exchange Act that occurred during the quarter ended April 30, 2015 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II

Item 1.     Legal Proceedings

During the six months ended April 30, 2015, there have been no material developments from the legal proceedings disclosed in our Annual Report on Form 10-K for our fiscal year ended October 31, 2014, except (i) those disclosed in Part II, Item 1 of our Quarterly Report on Form 10-Q for the fiscal quarter ended January 31, 2015, and (ii) those disclosed below:

Profit Sharing Disputes

In March 2015, the 6^th Circuit Court of Appeals remanded the case to the U.S. District Court for the Southern District of Ohio ("Court") with instructions that the claims in the Committee's Profit Sharing Complaint be arbitrated pursuant to the dispute resolution procedures in the Profit Sharing Plan. In May 2015, the Court ordered that the claims be arbitrated pursuant to the order of the Court of Appeals.

Shareholder Litigation

In the “10b-5 Cases” (as defined under Note 11, Commitments and Contingencies, to the accompanying consolidated financial statements, above), on the Court's own motion, the ruling date on the Motion to Dismiss the Second Amended Complaint was extended again to June 11, 2015.

MaxxForce Engine EGR Warranty Litigation

One additional putative class action lawsuit was filed in the District of Alabama bringing the total number of U.S. Actions to eighteen. On March 5, 2015, Judge Gottschall entered an order in the MDL proceeding appointing interim lead counsel and interim liaison counsel for the Plaintiffs. On May 11, 2015, lead counsel for the Plaintiffs filed a Consolidated Amended Complaint. The next status conference is set for July 2015.

Brazil Truck Dealer Disputes

During a preliminary hearing before the arbitral tribunal on March 24, 2015, the parties agreed to submit all of the pending claims between the parties to the exclusive jurisdiction of the arbitral tribunal. The arbitral tribunal will issue a schedule for the arbitration submissions. As of April 30, 2015, the approximate amount of the IIAA claim against Navitrucks is R$71 million (approximately US$24 million as of April 30, 2015), and the approximate amount of the Navitrucks claim against IIAA is R$182 million (approximately US$61 million as of April 30, 2015).

EPA Notice of Violation

Navistar and the DOJ are in continuing discussions concerning this matter. If the DOJ ultimately initiates litigation, it is likely that the DOJ will request a significant civil penalty.

Item 1A. Risk Factors

During the six months ended April 30, 2015, there have been no material changes from the risk factors disclosed in our Annual Report on Form 10-K for our year ended October 31, 2014, except as disclosed below;

Significant changes expected at GE Capital may adversely impact the retail and/or wholesale financing for our products in the U.S. and Canada.

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Navistar Capital, an alliance with GE Capital, has been our preferred source of retail customer financing for equipment offered by us and our dealers in the U.S. since 2010. In addition, GE Capital has provided wholesale and retail financing to support the sale of our products in Canada for over 25 years (“GE NavCap Canada”). On April 10, 2015, General Electric Company, the parent of GE Capital, announced a plan to reduce the size of its financial services businesses through the sale of most of the assets and businesses of GE Capital - including Navistar Capital and GE NavCap Canada - over the next 24 months. If GE Capital is unable to sustain the volume and quality of the loan origination and other financing services it has provided to date while it is in the midst of a sale process, or if the third party or parties to whom it sells Navistar Capital and GE NavCap Canada are unable or unwilling to do so, our ability to sell our products with financing may be adversely affected, and as a result, our business, financial condition, results of operations and cash flows may suffer. Furthermore, if GE Capital is unable or unwilling to find a buyer for Navistar Capital and GE NavCap Canada, or if GE Capital’s proposed buyer is unacceptable to us, then GE Capital may exercise its right to terminate its arrangements with us upon delivery of twelve months’ advance notice. If GE Capital chooses to exercise this option, we will need to deploy significant resources to identify a new financial services partner, or prepare to assume direct control and responsibility for loan origination and other financing services, including raising capital to fund the financing activities, hiring additional financing personnel and developing internal systems and other infrastructure that had previously been managed by GE Capital. There can be no assurance that we would be able to adequately, timely or cost-effectively replace the financing services provided by GE Capital (either by identifying a new third-party partner or by internalizing such services and obtaining the capital needed to fund the financing activities), and any failure to do so could have an adverse effect on our business, financial condition, results of operations, and cash flows.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Recent Sales of Unregistered Securities

None.

Purchases of Equity Securities

None.

Item 3. Defaults upon Senior Securities

None.

Item 4. Mine Safety Disclosures

Not applicable.

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Item 5. Other Information

None.

Item 6. Exhibits

Exhibit:	Description	Page
(3)	Articles of Incorporation and By-Laws	E-1
(10)	Material Contracts	E-2
(31.1)	CEO Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002	E-19
(31.2)	CFO Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002	E-20
(32.1)	CEO Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002	E-21
(32.2)	CFO Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002	E-22
(99.1)	Additional Financial Information (Unaudited)	E-23
(101.INS)	XBRL Instance Document	N/A
(101.SCH)	XBRL Taxonomy Extension Schema Document	N/A
(101.CAL)	XBRL Taxonomy Extension Calculation Linkbase Document	N/A
(101.LAB)	XBRL Taxonomy Extension Label Linkbase Document	N/A
(101.PRE)	XBRL Taxonomy Extension Presentation Linkbase Document	N/A
(101.DEF)	XBRL Taxonomy Extension Definition Linkbase Document	N/A

All exhibits other than those indicated above are omitted because of the absence of the conditions under which they are required or because the information called for is shown in the consolidated financial statements and notes thereto in the Quarterly Report on Form 10-Q for the period ended April 30, 2015.

62

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 INTERNATIONAL CORPORATION

(Registrant)

/s/    SAMARA A. STRYCKER        

Samara A. Strycker

Senior Vice President and Corporate Controller

(Principal Accounting Officer)

June 4, 2015

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EX-3

EXHIBIT 3

NAVISTAR INTERNATIONAL CORPORATION

AND CONSOLIDATED SUBSIDIARIES

 ______________________________

ARTICLES OF INCORPORATION AND BY-LAWS

The following documents of Navistar International Corporation are incorporated herein by reference:

3.8 Restated Certificate of Incorporation of Navistar International Corporation dated February 12, 2015. Filed as Exhibit 3.1 to Current Report on Form 8-K, which was dated February 11, 2015 and filed on February 18, 2015. Commission File No. 0011-09618.

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EX-10

EXHIBIT 10

NAVISTAR INTERNATIONAL CORPORATION

AND CONSOLIDATED SUBSIDIARIES

______________________________

MATERIAL CONTRACTS

The following documents of Navistar International Corporation and its principal subsidiary, Navistar, Inc. are filed herewith:
10.87*	Navistar International Corporation 2013 Performance Incentive Plan amended and restated as of February 11, 2015 (marked to indicate all changes from the version effective as of February 19, 2013).
10.88*	Navistar Non-Employee Directors' Deferred Fee Plan amended and restated as of February 11, 2015 (marked to indicate all changes from the version effective as of November 1, 2013).

* Indicates a management contract or compensatory plan or arrangement required to be filed or incorporated by reference as an exhibit to this report.

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EXHIBIT 10.87

NAVISTAR INTERNATIONAL CORPORATION

2013 PERFORMANCE INCENTIVE PLAN

SECTION 1

ESTABLISHMENT OF THE PLAN

The Board of Directors of Navistar International Corporation approved the establishment of the Navistar International Corporation 2013 Performance Incentive Plan ("Plan") on December 11, 2012 subject to the approval of the Plan by the Stockholders of the Corporation. Upon approval of this Plan, the Corporation will cease making new grants under the Navistar 2004 Performance Incentive Plan, as amended (“the 2004 Plan”).

SECTION 2

PURPOSE OF THE PLAN

The purpose of the Plan is to enable the Corporation and its subsidiaries to attract and retain highly qualified Employees, Consultants, and Non-Employee Directors, and additionally to provide key Employees the opportunity to earn incentive awards commensurate with the quality of individual performance, the achievement of performance goals and ultimately the increase in stockholder value.

SECTION 3

DEFINITIONS

For the purposes of the Plan, the following words and phrases shall have the meanings described below in this Section 3 unless a different meaning is plainly required by the context.

(1) "Annual Incentive Award" means an award of cash, shares of Common Stock, Restricted Stock or Stock Units, in each case, as determined by the Committee.

(2) "Award" means an award made under the Plan.

(3) "Award Agreement" means an agreement entered into by the Corporation and a Participant setting forth the terms and provisions applicable to an Award granted to a Participant.

(4) "Board of Directors" means the Board of Directors of the Corporation.

(5) "Change in Control" shall be deemed to have occurred if (i) any "person" or "group" (as such terms are used in Section 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended), other than employee or retiree benefit plans or trusts sponsored or established by the Corporation or Navistar, Inc., is or becomes the "beneficial owner" (as defined in Rule 13d-3 under the Securities Exchange Act of 1934, as amended), directly or indirectly, of securities of the Corporation representing 25% or more of the combined voting power of the Corporation's then outstanding securities, (ii) the following individuals cease for any reason to constitute more than three-fourths of the number of directors then serving on the Board of Directors : individuals who, on the date hereof, constitute the Board of Directors and any new director whose appointment or election by the Board of Directors or nomination for election by the Corporation's stockholders was approved by the vote of at least two-thirds (2/3) of the directors then still in office or whose appointment, election or nomination was previously so approved or recommended; (iii) any dissolution or liquidation of the Corporation or Navistar, Inc. or sale or disposition of all or substantially all (more than 50%) of the assets of the Corporation or of Navistar, Inc. occurs; or (iv) as the result of, or in connection with, any cash tender offer, exchange offer, merger or other business combination, sale of assets, proxy or consent solicitation, contested election or substantial stock accumulation (a "Control Transaction"), the members of the Board of Directors immediately prior to the first public announcement relating to such Control Transaction shall immediately thereafter, or within two (2) years, cease to constitute a majority of the Board of Directors. Notwithstanding the foregoing, the sale or disposition of any or all of the assets or stock of Navistar Financial Corporation shall not be deemed a Change in Control.

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(6) "Code" means the Internal Revenue Code of 1986, as amended from time to time.

(7) "Committee" means (i) with respect to Awards to Employees and Consultants, the Compensation Committee of the Board of Directors or another committee appointed by the Board of Directors, and (ii) with respect to Awards to Non-Employee Directors, the Nominating and Governance Committee of the Board of Directors, or another committee appointed by the Board of Directors or the Board of Directors themselves. To the extent deemed necessary or appropriate by the Board of Directors, each Committee member will be an “outside director” as defined in regulations under Section 162(m) of the Code and/or a “non-employee director” as defined in Rule 16b-3(b)(3)(i) under the Securities Exchange Act of 1934, as amended. The Board of Directors may appoint different Committees to perform different functions under the Plan and, in that case, any reference herein to “the Committee” will mean the Committee appointed by the Board of Directors to perform the particular function being discussed. For example, the Board of Directors may appoint one or more individuals in accordance with 8 Del. C. 1953, § 157(c) to serve as the Committee for the sole purpose of approving Awards to specified classes of Participants.

(8) "Common Stock" means the common stock of the Corporation.

(9) "Consultant" means a person engaged under a written contract with the Corporation or any subsidiary of the Corporation to provide consulting or advisory services (other than as an Employee or a Non-Employee Director) to such entity, provided that the identity of such person, the nature of such services or the entity to which such services are provided would not preclude the Corporation from offering or selling Common Stock to such person pursuant to the Plan in reliance on either the exemption from registration provided by Rule 701 under the Securities Act of 1933, as amended, or, if the Corporation is required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, registration on a Form S-8 (Registration Statement Under the Securities Act of 1933).

(10) "Corporation" means Navistar International Corporation.

(11) "Employee" means a person employed by the Corporation or any subsidiary of the Corporation, including its officers. Unless the Committee provides otherwise in an applicable Award Agreement, vesting of Awards granted hereunder will be suspended during any unpaid leave of absence. An individual shall not cease to be an Employee in the case of (i) any leave of absence approved by the Company or (ii) transfers between locations of the Corporation or between the Corporation or any subsidiary of the Corporation. For purposes of Incentive Stock Options, no such leave may exceed 90 days, unless reemployment upon expiration of such leave is guaranteed by statute or contract. If reemployment upon expiration of a leave of absence approved by the Corporation is not so guaranteed, then three months following the 91st day of such leave, any Incentive Stock Option held by a Participant shall cease to be treated as an Incentive Stock Option and shall be treated for tax purposes as a Nonqualified Stock Option.

(12) "Exercise Price" means: (i) in the case of a Stock Option, the amount for which one share of Common Stock may be purchased upon exercise of the Stock Option, or (ii) in the case of a SAR, the price above which Common Stock appreciation is measured, in either case as specified in the applicable Award Agreement.

(13) "Fair Market Value" means, as applied to a specific date, the price of a share of Common Stock that is based on the opening, closing, actual, high, low or average selling prices of share of Common Stock reported on any established stock exchange or national market system including without limitation the New York Stock Exchange and the National Market System of the National Association of Securities Dealers, Inc. Automated Quotation System on the applicable date, the preceding trading day, the next succeeding trading day, or an average of trading days, as determined by the Committee in its discretion. Unless the Committee determines otherwise or unless otherwise specified in an Award Agreement, Fair Market Value shall be deemed to be equal to the closing pricethe average of the high and low prices of a share of Common Stock on the most recent date on which shares of Common Stock were publicly traded. Notwithstanding the foregoing, if shares of Common Stock are not traded on any established stock exchange or national market system, the Fair Market Value means the price of a share of Common Stock as established by the Committee acting in good faith based on a reasonable valuation method that is consistent with the requirements of Section 409A of the Code and the regulations thereunder.

(14) "Fiscal Year" means the fiscal year of the Corporation.

(15) "Freestanding SAR" means any SAR that is granted independently of any Stock Option.

(16) "Grant Date" means, as determined by the Committee, (i) the date as of which the Committee approves an Award, or (ii) such later date as may be specified by the Committee. The Grant Date of a Stock Option will, unless the Committee expressly determines otherwise, be the day on which the Committee approves the grant of such Stock Option.

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(17) "Incentive Stock Option" means a right, as evidenced by an Award Agreement to purchase a certain number of shares of Common Stock at Fair Market Value for a period of no longer than ten (10) years from the Grant Date which option is designed to meet the requirements set out under Section 422 of the Code.

(18) "Non-Employee Director" means as of the Grant Date of an Award an individual who is a director of the Corporation and is neither a Consultant nor an Employee.

(19) "Nonqualified Stock Option" means a right, as evidenced by an Award Agreement to purchase a certain number of shares of Common Stock at Fair Market Value for a period of not more than ten (10) years from the Grant Date which option is stated not to be Incentive Stock Options under the Code.

(20) “Other Award” means an Award (other than a Stock Option, SAR, Restricted Stock or Stock Unit Award) based on, measured with respect to, convertible into or exchangeable for Common Stock, which Award is evidenced by an Award Agreement and granted pursuant to Section 8 of the Plan.

(21) "Participant" means an Employee, Consultant, or Non-Employee Director who has been granted an Award under this Plan.

(22) "Performance-Based Exception" means the performance-based exception from the tax deductibility limitation imposed by Section 162(m) of the Code as set forth in Section 162(m)(4)(C) of the Code or any successor provision.

(23) "Performance Measure" means the performance measurement provided by Section 6.

(24) "Performance Period" means the period during which performance goals must be met for purposes of the Performance Measure.

(24) "Plan" means the Navistar International Corporation 2013 Performance Incentive Plan as set forth herein and as it may be amended hereafter from time to time.

(25) "Qualified Retirement" for an Employee shall have the meaning set forth in the applicable Award Agreement; provided that, if the applicable Award Agreement does not define Qualified Retirement, the Employee will not be deemed eligible for Qualified Retirement for purposes of this Plan. Qualified Retirement for a Non-Employee Director means retirement under the retirement policy of the Board of Directors, as in effect from time to time.

(26) "Restricted Stock" means an Award of Common Stock, as evidenced by an Award Agreement and granted pursuant to Section 11(3), of the Plan.

(27) "Stock Appreciation Right" or "SAR" means an Award, evidenced by an Award Agreement and granted either alone or in connection with a related Stock Option, pursuant to Section 10 of the Plan.

(28) "Stock Option" means either an Incentive Stock Option or a Nonqualified Stock Option granted pursuant to Section 7 of the Plan.

(29) "Stock Units" mean a right to receive Common Stock (or cash equal to the fair market value of Common Stock) upon or following the satisfaction of specified conditions, as evidenced by an Award Agreement and granted pursuant to Section 11 of the Plan.

(30) "Tandem SAR" means a SAR granted with respect to a share of Common Stock pursuant to Section 10 hereof in connection with a related Stock Option, under which: (a) the exercise of the SAR with respect to the share shall cancel the right to purchase such share under the related Stock Option, and (b) the purchase of the share under the related Stock Option shall cancel the right to exercise the SAR with respect to such share.

SECTION 4

ELIGIBILITY

Consultants, Employees and Non-Employee Directors are all eligible to receive Awards.

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SECTION 5

ANNUAL INCENTIVE AWARDS

(1) The Committee will designate Employees eligible to receive Annual Incentive Awards hereunder, the performance criteria applicable to such Awards, the amount payable upon fulfillment of such performance criteria (and, if applicable, for performance above or below targeted levels of performance) and all other terms and conditions applicable to such Awards. The Committee shall set the performance criteria for each year's Annual Incentive Awards no later than the 90th day of the Fiscal Year. The performance criteria shall be determined in the discretion of the Committee, provided that an Award under this Section that is intended to qualify for the Performance-Based Exception shall use performance criteria described in Section 6(1).

(2) As soon as practical following the end of the Fiscal Year, the Committee will certify performance achieved against the performance criteria established at the beginning of the Fiscal Year.

(3) The Committee, in its sole discretion, may adjust any Annual Incentive Award otherwise earned based on an assessment of individual performance, but in no event may any such adjustment result in an increase of an Award intended to qualify for the Performance-Based Exception. The Committee shall determine the amount of any such adjustment by taking into account such factors as it deems relevant including, without limitation: (a) performance against other financial or strategic objectives; (b) its subjective assessment of the Participant's overall performance for the year; and (c) prevailing levels of total compensation among similar companies.

(4) Performance criteria for Annual Incentive Awards will not be adjusted within a Fiscal Year except under circumstances approved by the Committee and, in the case of Annual Incentive Awards intended to satisfy the Performance-Based Exception, in a manner consistent with that exception.

(5) Payment of an Annual Incentive Award will be made in cash, shares of Common Stock, Restricted Stock, Stock Units or a combination of any of the foregoing, as determined in the sole discretion of the Committee to the Participant by March 15 of the calendar year following the end of the Fiscal Year to which the Annual Incentive Award relates, subject to any deferral in payment permitted or required by the Committee under such rules and procedures it may establish.

(6) It shall be presumed unless the Committee determines to the contrary, that all Awards to Employees under this Section are intended to qualify for the Performance-Based Exception. If the Committee does not intend an Annual Incentive Award to qualify for the Performance-Based Exception the Committee shall reflect its intent in its records in such manner as the Committee determines to be appropriate. For the purpose of complying with the Performance-Based Exception, the maximum Award under this Section paid to any one Employee during any one Fiscal Year shall not exceed $4,000,000, if paid in cash or 1,000,000 shares of Common Stock, if paid in equity.

SECTION 6

PERFORMANCE MEASUREMENT

(1) The Performance Measures that determine the degree of payout and/or vesting of Awards designed to qualify for the Performance-Based Exception may be measured at the Corporation level, at a subsidiary level, or at an operating unit level and shall be chosen from among: (a) income measures (including, but not limited to, gross profits, operating income, earnings before or after taxes, earnings before interest and taxes, earnings before interest, taxes, depreciation, and amortization, earnings per share, cost reductions); (b) return measures (including, but not limited to, return on assets, capital, investment, equity, or sales); (c) cash flow or cash flow return on investments, which equals net cash flows divided by owners equity; (d) revenues from operations; (e) total revenue; (f) cash value added; (g) economic value added; (h) share price (including, but not limited to, growth measures and total shareholder return); (i) sales growth; (j) market share; (k) the achievement of certain quantitatively and objectively determinable non-financial performance measures (including, but not limited to, growth strategies, strategic initiatives, product development, product quality, corporate development, and leadership development); and (l) any combination of, or a specified increase in, any of the foregoing. The Performance Measures may be expressed in either absolute terms or relative to the performance of one or more companies (or an index of multiple companies) identified by the Committee.

(2)    Adjustments to Performance Measures. The Committee may provide, at the time Performance Measures are established, that adjustments will be made to those performance goals to take into account, in any objective manner specified by the Committee, the impact of one or more of the following: (a) gain or loss from all or certain claims and/or litigation and insurance recoveries, (b) the impairment of tangible or intangible assets, (c) stock-based compensation expense, (d) extraordinary, unusual or infrequently occurring events reported in the Company's public filings, (e) restructuring activities reported in the Company's

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public filings, (f) investments, dispositions or acquisitions, (g) loss from the disposal of certain assets, (h) gain or loss from the early extinguishment, redemption, or repurchase of debt, (i) changes in accounting principles, or (j) any other item, event or circumstance that would not cause an Award to fail to constitute for the Performance-Based Exception. An adjustment described in this Section may relate to the Corporation, any subsidiary, or any operating unit, as determined by the Committee at the time the Performance Measures are established. Any adjustment shall be determined in accordance with generally accepted accounting principles and standards, unless such other objective method of measurement is designated by the Committee at the time Performance Measures are established.

(3) The Committee shall have the discretion to adjust the determination of the degree of attainment of the pre-established goals; provided that the Awards that are designated to qualify for Performance-Based Exception may not be adjusted upward (although the Committee shall retain the discretion to adjust such Awards downward). In no event shall the Performance Period for any performance-based equity Award be less than one year.

(4) In the case of any Award that is granted subject to the condition that a specific Performance Measure be achieved, no payment under such Award shall be made prior to the time the Committee certifies in writing that that the Performance Measure has been achieved. For this purpose, approved minutes of the Committee meeting at which the certification is made shall be treated as a written certification. No such certification is required, however, in the case of an Award that is based solely on an increase in the value of a share of Common Stock from the date the Award is made.

(5)Notwithstanding the foregoing or any other provision of this Plan, the Committee may provide that any Award intended to satisfy the Performance-Based Exception may become vested and/or payable, in whole or in part, in the event of the Participant's death or disability, a Change in Control or under other circumstances consistent with the Section 162(m) of the Code.

SECTION 7

STOCK OPTIONS

(1) The Committee may grant Nonqualified Stock Options to any person eligible to be a Participant. The Committee may grant Incentive Stock Options only to Employees. In order to provide a limitation on the number of shares as provided for in Section 162(m) of the Code and the regulations thereunder, Stock Option grants shall be limited to a maximum of 1,000,000 shares per Fiscal Year for any Employee reduced by the number of SARs granted to that Employee in that year.

(2) The Committee will document the terms of the Stock Option in an Award Agreement to include the Grant Date and Exercise Price, as well as any other terms that it may desire. The Exercise Price under a Stock Option shall not be less than one hundred percent (100%) of the Fair Market Value. Subject to adjustment pursuant to Section 12, the Exercise Price of outstanding Stock Options fixed by the Committee shall not be modified.

(3) A Stock Option shall become exercisable in whole or in part upon satisfaction of the conditions specified in the Award Agreement, provided, however, that, except as otherwise provided in subparts (7), (8), (9) or (10) of this Section, no Stock Option vesting on the basis of continued service shall vest in full prior to the commencement of the third anniversary of the Grant Date.

(4) In no event, however, may a Stock Option governed by the Plan be exercised after the expiration of its term. Except as provided herein or in the applicable Award Agreement, no Stock Option may be exercised at any time unless the Participant who holds the Stock Option is then employed by or in service with the Corporation or a subsidiary thereof. The option can be exercised in whole or in part through (i) cashless exercise, (ii) the Corporation withholding from the shares of Common Stock otherwise issuable upon exercise of the Stock Option a number of shares of Common Stock having a Fair Market Value equal, as of the date of exercise, to the Exercise Price of the Stock Option multiplied by the number of shares of Common Stock in respect of which the Stock Option shall have been exercised (“Net-Exercise”), or (iii) other arrangements through agents, including stockbrokers, under arrangements established by the Corporation by paying the amounts required by instructions issued by the Secretary of the Corporation for the exercise of the Stock Options. If an exercise is not covered by instructions issued by the Secretary of the Corporation, the purchase price is to be paid in full to the Corporation upon the exercise of a Stock Option (I) by cash including a personal check made payable to the Corporation, (II) by delivering at fair market value on the date of exercise unrestricted Common Stock already owned by the Participant, or (III) by any combination of cash and unrestricted Common Stock, and in any case, by payment to the Corporation of any withholding tax. Unless otherwise determined by the Committee, shares of Common Stock that otherwise would be delivered to the holder of a Stock Option may be delivered to the Corporation in payment of federal, state and/or local withholding taxes payable in connection with an exercise.

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(5) The Participant who holds a Stock Option will have none of the rights of a stockholder with respect to the shares subject to that Stock Option until such shares are issued upon the exercise of that Stock Option.

(6) Neither the Corporation nor any subsidiary may directly or indirectly lend money to any Participant for the purpose of assisting the individual to acquire shares of Common Stock issued upon the exercise of Stock Options granted under the Plan.

(7)In the event of the termination of the employment or service of a Participant who holds an outstanding Stock Option, other than by reason of death, total and permanent disability or (in the case of an Employee or Non-Employee Director) a Qualified Retirement, the Participant may (unless the Stock Option shall have been previously terminated) exercise the Stock Option at any time within twelve (12) months of such termination, but not after the expiration of the term of the Award, to the same extent the Stock Option was exercisable at the date of such termination of employment or service. The transfer of a Participant between the Corporation and any of its subsidiaries will not constitute a termination as long as there is no interruption of employment or service. If the Participant is terminated for cause, as defined in the Navistar Inc. Income Protection Plan (or if the Participant is covered by a different severance plan or agreement, then as defined in such plan or agreement), the post-termination exercise period provided by this subsection shall not apply and the Stock Option shall cease to be exercisable and shall lapse as of the effective date of the termination.

(8) Except as provided in Section 7(11), in the event of a Qualified Retirement a Participant who holds an outstanding Stock Option may exercise the Stock Option to the extent the option is exercisable or becomes exercisable under the terms of the applicable Award Agreement.

(9) In the event of a total and permanent disability, as defined by the Corporation's long term disability programs, (or in the case of a Consultant or Non-Employee Director, as determined by the Committee), a Participant who holds an outstanding Stock Option may exercise the Stock Option, to the extent the Stock Option is exercisable or becomes exercisable under its terms, at any time within three (3) years after such termination or, if later, the date on which the option becomes exercisable with respect to such shares, but not after the expiration of the term of the option.

(10) In the event of the death of a Participant who holds an outstanding Stock Option, the Stock Option may be exercised by a legatee, or by the personal representatives or distributees, at any time within a period of two (2) years after death, but not after the expiration of the term of the option. If death occurs while employed by or in service with the Corporation or a subsidiary , or after a Qualified Retirement or during the three- year period specified in Section 9, Stock Options may be exercised to the extent of the remaining shares covered by Stock Options whether or not such shares were exercisable at the date of death. If death occurs during the twelve (12) month period specified in Section 7, Stock Options may be exercised to the extent of the number of shares that were exercisable at the date of death.

(11) Notwithstanding the other provisions of Section 7, no Stock Option which is not exercisable at the time of a Qualified Retirement shall become exercisable after such Qualified Retirement if, without the written consent of the Corporation, a Participant engages in a business, whether as owner, partner, officer, employee, or otherwise, which is in competition with the Corporation or one of its affiliates, and if the Participant's participation in such business is deemed by the Committee to be detrimental to the best interests of the Corporation. The determination as to whether such business is in competition with the Corporation or any of its affiliates, and whether such participation by such person is detrimental to the best interests of the Corporation, shall be made by the Committee in its absolute discretion, and the decision of the Committee with respect thereto, including its determination as to when the participation in such competitive business commenced, shall be conclusive.

(12) Notwithstanding any provision of the Plan to the contrary, under no circumstances whatsoever shall a Stock Option be exercisable during any period when the exercise of such Stock Option would violate Applicable Law, as defined in Section 22.

SECTION 8

OTHER AWARDS

(1) The Committee may grant Other Awards to persons eligible to be Participants on such terms and conditions as the Committee deems appropriate. Other Awards may be granted subject to achievement of performance goals or other conditions and may be payable in Common Stock or cash, or in a combination of the two, as determined by the Committee.

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(2) Other Awards intended to qualify for the Performance-Based Exception will vest or be earned based on satisfaction of Performance Measures specified by the Committee in accordance with Section 6. For Other Awards denominated in shares of Common Stock and intended to qualify for the Performance-Based Exception, the total number of shares subject to Other Awards

granted to any one Employee during any one Fiscal Year shall not exceed 1,000,000 shares. For Other Awards denominated in cash and intended to qualify for the Performance-Based Exception, the maximum amount paid to any one Employee during any one Fiscal Year with respect to Other Awards shall not exceed $4,000,000.

SECTION 9

PROHIBITION ON REPRICING AND DISCOUNTED STOCK OPTIONS AND SARs

Notwithstanding any other provision in the Plan, no Stock Option or SAR may be amended or modified in any way that changes the Exercise Price of the Stock Option or SAR, and no Stock Option or SAR may be issued with an Exercise Price that is less than the Fair Market Value or in any other way discounted. This provision shall not limit any adjustments provided by Section 12 relating to adjustments upon changes in capitalization.

SECTION 10

STOCK APPRECIATION RIGHTS

(1) The Committee may, subject to the terms of the Plan, grant SARs to persons eligible to be Participants at any time and from time to time as shall be determined by the Committee. A SAR shall become exercisable in whole or in part upon satisfaction of the conditions specified in the Award Agreement, provided, however, that except as otherwise provided by the Committee, in the event of a Participant's death, disability, or Qualified Retirement no SAR vesting on the basis of continued service shall vest in full prior to the commencement of the third anniversary of the Grant Date.

(2) The Committee may grant Freestanding SARs, Tandem SARs, or any combination thereof. The Committee shall have complete discretion in determining the number of SARs, subject to the terms of the Plan, and to determine the terms of the SARs. The Exercise Price of a Freestanding SAR shall equal the Fair Market Value. The Exercise Price of Tandem SARs shall equal the Exercise Price of the related Stock Option.

(3) Tandem SARs may be exercised for all or part of the shares of Common Stock subject to the related Stock Option upon the surrender of the right to exercise the equivalent portion of the related Stock Option.

(4) With respect to a Tandem SAR granted in connection with an Incentive Stock Option, the Tandem SAR shall expire no later than the expiration of the Incentive Stock Option. (5) Freestanding SARs may be exercised upon whatever terms and conditions the Committee, in its discretion, imposes upon them, subject, however, to the terms of the Plan.

(5) The Participant who holds a SAR will have none of the rights of a stockholder with respect to the shares subject to that SAR until such shares are issued upon the exercise of that SAR.

(6) The term of SARs shall be determined by the Committee, in its discretion; provided that such term shall not exceed 10 years.

(7) Upon exercise of a SAR, a Participant shall be entitled to receive payment from the Corporation in an amount determined by multiplying: (a) the excess of the Fair Market Value of one share of Common Stock on the date of exercise over the Exercise Price, by (b) the number of shares of Common Stock with respect to which the SAR is exercised. At the discretion of the Committee, the payment upon exercise of a SAR may be in cash, Common Stock with a Fair Market Value equal to the amount payable, or in a combination thereof.

(8) All awards to Employees under this Section are intended to qualify for Performance-Based Exception. For the purpose of complying with the Performance-Based Exception, the number of SARs that can be granted to any one Employee in any Fiscal Year shall not exceed 1,000,000, less the number of shares of Common Stock subject to Stock Options granted to such Employee during that Fiscal Year

SECTION 11

RESTRICTED STOCK AND STOCK UNITS

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(1) Restricted Stock, or Stock Units, may be granted at any time to any person eligible to be a Participant.

(2) Awards of Restricted Stock or Stock Units may be made to Participants for the purpose of satisfying the stock ownership requirements described in the Navistar Executive Stock Ownership Program, as amended from time to time, or for any other purpose.

(3) Each Award of Restricted Stock or Stock Units shall become vested, in full or in installments, upon satisfaction of the conditions specified in the Award Agreement. For avoidance of doubt, such conditions may include the achievement of Performance Measures specified by the Committee in accordance with Section 6. In no event will an Award of Restricted Stock or Stock Units that vests solely on the basis of continued service vest in full prior to the commencement of the third year anniversary of the Grant Date, except as otherwise provided below in Section 11(6) and 11(7), and except that any Award (or portion thereof) of Restricted Stock or Stock Units representing a Non-Employee Director's first quarterly retainer shall be immediately vested upon the Grant Date.

(4) The Participant will be entitled to all dividends paid with respect to all Restricted Stock awarded under the Plan during the period of restriction and will not be required to return any such dividends to the Corporation in the event of the forfeiture of the Restricted Stock. The Participant also will be entitled to vote Restricted Stock during the period of restriction.

(5) Pending the vesting a Restricted Stock Award, the shares of Common Stock subject thereto may not be sold, pledged, assigned, encumbered or otherwise transferred and a stop transfer order will be issued to the Corporation's transfer agent. Any certificates issued in respect of Restricted Stock will include a legend reflecting these transfer restrictions (as well as any other legends deemed appropriate by the Committee) and may be held in escrow by the Secretary of the Corporation (or his or her designee) pending the vesting of that stock.

(6) In the event a Participant dies while employed by the Corporation or a subsidiary, performing services as a Consultant, or serving as a Non-Employee-Director, the Restricted Stock or Stock Units will vest as of the date of death and all restrictions shall lapse and the Restricted Stock or Stock Units will be immediately transferable to the named beneficiary or to the Participant's estate. Any Restricted Stock or Stock Units that becomes payable after the Participant's death shall be distributed to the Participant's beneficiary or beneficiaries. A beneficiary designation may be changed by filing the prescribed form with the Secretary of the Corporation at any time before the Participant's death. If no beneficiary was designated or if no designated beneficiary survives the Participant, then any Restricted Stock or Stock Units that becomes payable after the Participant's death shall be distributed to the Participant's estate.

(7) Unless otherwise provided for in the applicable Award Agreement, Restricted Stock granted to an Employee or Non-Employee Director will become nonforfeitable upon the Participant's eligibility for Qualified Retirement (and Restricted Stock granted to an Employee or Non-Employee Director who is already eligible for Qualified Retirement will be nonforfeitable immediately upon issuance), provided that such Restricted Stock will remain subject to the transfer restrictions described above in Section 11(5) in such proportions and until such dates as specified in the vesting schedule otherwise applicable to the Award. Similarly, unless otherwise provided for in the applicable Award Agreement, Restricted Stock will become nonforfeitable upon cessation of a Participant's employment with, or service to, the Corporation due to his or her total and permanent disability (as determined by the Committee), provided that such Restricted Stock will remain subject to the transfer restrictions described above in Section 11(5) in such proportions and until such dates as specified in the vesting schedule otherwise applicable to the Award. Stock Units will be subject to accelerated vesting and/or settlement in connection with a Participant's Qualified Retirement or disability to the extent specified in the applicable Award Agreement.

(8) Except as otherwise provided above with respect to death, disability, or Qualified Retirement or unless otherwise provided in the applicable Award Agreement or determined by the Committee, if Participant terminates employment or service as a Consultant or Non-Employee Director, any Restricted Stock or Stock Units that are not then vested will be forfeited to the Corporation.

(9) To the extent and in the manner specified in the applicable Award Agreement, dividend equivalents with respect to outstanding Stock Unit Awards may be (a) credited in the form of additional Stock Units or deferred cash, or (b) paid promptly in cash. Whether Stock Units include such dividend equivalent rights will be determined by the Committee, in its discretion.

(10) The total number of shares subject to Restricted Stock and Stock Unit Awards intend to qualify for the Performance-Based Exception and granted to any one Employee during any one Fiscal Year shall not exceed 1,000,000 shares.

(11) Notwithstanding the other provisions of Section 11, any Restricted Stock or Stock Unit that becomes otherwise

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nonforfeitable due to a Participant's eligibility for Qualified Retirement and that has not yet been released from transfer restrictions (in the case of Restricted Stock) or that has not yet been settled (in the case of a Stock Unit) will be forfeited if, without the written consent of the Corporation, a Participant engages in a business, whether as owner, partner, officer, employee, or otherwise, which is in competition with the Corporation or one of its affiliates, and if the Participant's participation in such business is deemed by the Committee to be detrimental to the best interests of the Corporation. The determination as to whether such business is in competition with the Corporation or any of its affiliates, and whether such participation by such person is detrimental to the best interests of the Corporation, shall be made by the Committee in its absolute discretion, and the decision of the Committee with respect thereto, including its determination as to when the participation in such competitive business commenced, shall be conclusive.

SECTION 12

ADJUSTMENTS UPON CHANGES IN CAPITALIZATION

Notwithstanding any other provision of the Plan, in the event of a recapitalization, stock split or combination, stock dividend, spin-off, merger, consolidation, reorganization or other similar event or transaction affecting the Common Stock, substitutions or adjustments will be made by the Committee to the aggregate number, class and/or issuer of the securities that may be issued under the Plan to the annual limits on Awards, to the number, class and/or issuer of securities subject to outstanding Awards and to the exercise price of outstanding Stock Options and SARs, in each case in a manner that reflects equitably the effects of such event or transaction.

SECTION 13

ADMINISTRATION OF THE PLAN

Full power, authority and discretion to construe, interpret and administer the Plan are vested in the Committee. Decisions of the Committee will be final, conclusive and binding upon all parties, including the Corporation, stockholders, Participants, and their beneficiaries. The foregoing will include, but will not be limited to, all determinations by the Committee as to (a) the selection of Employees, Consultants, and Non-Employee Directors for participation in the Plan, (b) the size, type and other terms of Awards, (c) the selection and adjustment of performance criteria, and (d) the extent to which performance criteria or other vesting conditions are satisfied, and (e) the waiver or amendment of any Award terms. Any person who accepts any Award hereunder agrees to accept as final, conclusive and binding all determinations of the Committee. The Committee will have the right, in the case of Employees or Consultants who are employed or engaged to perform services, respectively, outside the United States, or Non-Employee Directors not resident in the United States, to vary from the provision of the Plan to the extent the Committee deems appropriate in order to preserve the incentive features of the Plan.

SECTION 14

NON-ASSIGNMENT

Awards may not be assigned, alienated, or otherwise transferred. In case of a Participant's death, the amounts distributable to the deceased Participant under the Plan with respect to which a designation of beneficiary has been made (to the extent it is valid and enforceable under applicable law) shall be distributed in accordance with the Plan to the designated beneficiary or beneficiaries. The amount distributable to a Participant upon death and not subject to such a designation shall be distributed to the Participant's estate. If there is any question as to the right of any beneficiary to receive a distribution under the Plan, the amount in question may be paid to the estate of the Participant, in which event the Corporation will have no further liability to anyone with respect to such amount.

SECTION 15

WITHHOLDING TAXES

(1) A Participant may elect, subject to the provisions of the applicable Sections of the Plan and the terms of the Award, to pay any withholding tax due in connection with the exercise of any Stock Option or SAR or upon the vesting of Restricted Stock or the settlement of Stock Units or any other Award either (i) by cash including a personal check made payable to the Corporation or (ii) by delivering at fair market value, on the date that the amount of tax to be withheld is determined, unrestricted Common Stock already owned by the Participant, or (iii) by any combination of cash or unrestricted Common Stock. In addition, the Committee may permit, in the Award Agreement or otherwise, that in the event that a Participant is required to pay to the Corporation any amount to be withheld in connection with the exercise, vesting or settlement of an Award denominated in shares of Common

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Stock, the Participant may satisfy such obligation (in whole or in part) by electing to have the Corporation withhold a portion of the shares of Common Stock otherwise to be issued upon exercise, vesting or settlement of such Award equal in value to the minimum amount required to be withheld. The value of the shares of Common Stock to be withheld shall be the Fair Market Value on the date that the amount of tax to be withheld is determined.

(2) The Corporation does not warrant the tax treatment of Awards. Accordingly, while the Corporation will endeavor to structure Awards to comply with or be exempt from the requirements of Section 409A of the Code, the Corporation will have no obligation to indemnify any Participant from any taxes or penalties incurred under Section 409A of the Code (or any other

taxes or penalties).

SECTION 16

RIGHTS OF PARTICIPANT

To the extent that any Participant, beneficiary or estate acquires a right to receive payments or distributions under the Plan, such right will be no greater than the right of a general unsecured creditor of the Corporation. All payments and distributions to be made hereunder will be paid from the general assets of the Corporation. Nothing contained in the Plan, and no action taken pursuant to its provisions, shall create or be construed to create any contracted right or trust of any kind or fiduciary relationship between the Corporation and any Participant, beneficiary or estate.

SECTION 17

MODIFICATION, AMENDMENT OR TERMINATION

The Committee may modify, amend, or terminate the Plan at any time, provided that, unless the requisite approval of stockholders is obtained, no amendment shall be made to the Plan if such amendment would (i) increase the number of shares of Common Stock available for issuance under the Plan or increase the limits applicable to Awards under the Plan, in each case, except as provided in Section 12; (ii) lower the Exercise Price of the Stock Option or SAR grant value below 100% of the Fair Market Value except as provided in Section 12; (iii) remove the repricing restriction set forth in Section 9; or (iv) require stockholder approval as a matter of law or under rules of the New York Stock Exchange. No Plan amendment shall, without the affected Participant's consent, terminate or adversely affect any right or obligation under any Stock Option or other Award previously granted under the Plan.

SECTION 18

RESERVATION OF SHARES

(1) The total number of shares of Common Stock reserved and available for delivery pursuant to this Plan is 3,665,500, all of which will be available for issuance in respect to Incentive Stock Options. The number of shares of Common Stock authorized and available shall be increased by shares of Common Stock subject to an option or award under this Plan (or under the Navistar 1994 Performance Incentive Plan, the Navistar 1998 Supplemental Stock Plan, the 1998 Non-Employee Director Stock Option Plan or the 2004 Plan) that is cancelled, expired, forfeited, settled in cash or otherwise terminated after the date this Plan is approved by the stockholders of the Corporation without a delivery of shares to the award holder, including shares of Common Stock withheld to satisfy the exercise price of an option or a tax withholding obligation arising in connection with an award. For avoidance of doubt, any shares of Common Stock subject to the exercised portion of a SAR that are not actually issued in connection with that exercise will become available for issuance with respect to other Awards.

(2) Shares of Common Stock issued hereunder may be in whole or in part, as the Board of Directors or its duly authorized delegate shall from time to time determine authorized and unissued shares of Common Stock or issued shares of Common Stock which shall have been reacquired by the Corporation.

(3) Notwithstanding any other provision of this Plan, Awards that do not meet the minimum three (3) year time-based vesting requirement elsewhere herein stated may be granted with respect to up to ten percent (10%) of the shares of Common Stock authorized for issuance under the first sentence of subsection (1) above.

SECTION 19

RIGHTS OF EMPLOYEES

Status as an Employee shall not be construed as a commitment that any one or more Awards will be made under this Plan

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to an Employee or to Employees generally. Status as a Participant shall not entitle the Participant to any additional future Awards. Nothing in the Plan will confer on any Employee or Participant any right to continue in the employ of the Corporation or any of its subsidiaries or interfere with or prevent in any way the right of the Corporation or any of its subsidiaries to terminate an Employee or Participant's employment at any time for any reason.

SECTION 20

CHANGE IN CONTROL

(1) Notwithstanding any provision contained herein to the contrary other than Section 20(3), in the event of both (x) a Change in Control and (y) either immediately before the date on which a Change in Control occurs or during the 36 month-period after the date of the then-most recent Change in Control, an Employee experiences (1) a separation for “Constructive Termination” or an involuntary termination for any reason other than “Cause” (both, as defined in the Employee's Executive Severance Agreement) or (2) an involuntary termination for any reason other than “Cause” (as defined in the Corporation's Income Protection Plan for those Employees who are not a party to an Executive Severance Agreement), then (I) all awarded Restricted Stock, Stock Units, and Other Awards will immediately be free of all restrictions and performance contingencies and will be deemed fully earned and not subject to forfeiture and (II) all outstanding Stock Options and SARs will be immediately exercisable and shall continue to be exercisable for a period of three (3) years from the date of the Change in Control regardless of employment status, except that the term of any Stock Options and SARs shall not be extended beyond the end of the original term of the Award.

(2) Notwithstanding any provision contained herein to the contrary other than Section 20(3), in the event of both (x) a Change in Control and (y) either immediately before the date on which a Change in Control occurs or during the 36 month-period after the date of the then-most recent Change in Control, a Consultant or Non-Employee Director experiences a separation in service, all awarded Restricted Stock, Stock Units, and Other Awards will immediately be free of all restrictions and performance contingencies and will be deemed fully earned and not subject to forfeiture and all outstanding Stock Options and SARs governed by the Plan will be immediately exercisable and shall continue to be exercisable for a period of three (3) years from the date of the Change in Control regardless of service status, except that the term of any Stock Options and SARs shall not be extended beyond the end of the original term of the Award.

(3) Upon or immediately prior to (and contingent on) a Change in Control or any similar transaction, the Committee may, in its sole discretion, take any or all of the following actions with respect to outstanding Awards: (a) accelerate the vesting of outstanding Awards, in whole or in part; (b) terminate all Stock Options and SARs, provided that the Committee provides the Participant an opportunity to exercise such Stock Options or SARs, as the case may be, within a specified period following the Participant's receipt of a notice of such transaction and the Committee's intention to terminate such Stock Options and SARs effective immediately prior to such transaction; (c) cancel any Stock Option or SAR in exchange for a payment in cash of an amount equal to (i) the product of (A) the difference, if any, between the then current Fair Market Value of one share of Common Stock and the per share Exercise Price of such Stock Option or SAR and (B) the number of shares underlying the unexercised portion of such Stock Option or SAR; provided, however, that if the per share Exercise Price of such Stock Option or SAR equals or exceeds the then current Fair Market Value of one share of Common Stock, such Stock Option or SAR shall be canceled with no payment due the Participant; (d) if such transaction also either constitutes a change in the ownership or effective control of the Corporation or Navistar, Inc., or a change in the ownership of a substantial portion of the assets of the Corporation or Navistar, Inc. (as defined in Section 409A(a)(2)(A)(v) (or any successor thereto) of the Code and its governing regulations) settle any outstanding Stock Unit or Other Award subject to Section 409A or cancel either such Award in exchange for a payment in cash of an amount equal to (i) the product of (A) the then current Fair Market Value of one share of Common Stock and (B) the number of shares underlying such Award; or (e) substitute cash for the Common Stock underlying any Stock Unit or Other Award in an amount equal to (i) the product of (A) the then current Fair Market Value of one share of Common Stock and (B) the number of shares underlying such Award, but retain the original vesting and payment schedule applicable to such Award. If the Corporation is not publicly traded immediately before such transaction, the Committee may, in its sole discretion, determine the Fair Market Value of the Common Stock based solely on the amount of consideration to be paid in respect thereof only on the closing date of such transaction (in which case such Stock Option and SAR holders shall not participate in any post-closing payments, such as net working capital, debt and cash adjustments, earn outs or escrows); The application of the foregoing provisions shall be determined by the Committee in its sole and absolute discretion and shall be binding on Participants and all other persons.

SECTION 21

LIMITATION OF ACTIONS

Every right of action by or on behalf of the Corporation or any stockholder against any past, present or future member of the Board of Directors, officer or Employee arising out of or in connection with the Plan will, irrespective of the place where

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action may be brought and irrespective of the place of residence of any such director, officer or Employee, cease and be barred by the expiration of three (3) years from whichever is the later of (a) the date of the act or omission in respect of which such right of action arises or (b) the first date upon which there has been made generally available to stockholders an annual report of the Corporation and a proxy statement for the annual meeting of stockholders following the issuance of such annual report, which annual report and proxy statement alone or together set forth, for the related period, the aggregate amount of Awards during such period; and any and all right of action by an Employee, Consultant, or Non-Employee Director (past, present or future) against the Corporation arising out of or in connection with the Plan shall, irrespective of the place where action may be brought, cease and be barred by the expiration of three (3) years from the date of the act or omission in respect of which such right of action arises.

SECTION 22

GOVERNING LAW

The Plan will be governed by and construed in accordance with applicable Federal laws and, to the extent not inconsistent therewith or pre-empted thereby, with the laws of the State of Delaware (without regard to the conflicts of laws provisions of that State or any other jurisdiction), including applicable regulations, rules, and such other applicable authorities thereunder (“Applicable Law”). Accordingly, for the avoidance of doubt, the receipt, exercise, issuance, and disposition, as appropriate, of any Award, Common Stock is expressly conditioned upon and subject to any and all limitations, restrictions, prohibitions, or such other conditions imposed by Applicable Law, including, but not limited to, applicable Federal and state securities law.

SECTION 23

EFFECTIVE DATE

The effective date of the Plan shall be February 19, 2013 (the "Effective Date"), subject to approval by the stockholders at the Corporation's Annual Meeting of stockholders to be held on February 19, 2013, or any adjournment thereof. The Plan shall continue in effect for ten (10) years from the Effective Date, until February 19, 2023. No Awards may be granted subsequent to February 19, 2023, but Awards theretofore granted may extend beyond that date in accordance with their terms.

* * * * * * *

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EXHIBIT 10.88

NAVISTAR NON-EMPLOYEE

DIRECTORS' DEFERRED FEE PLAN

(Amended and Restated as of February 11, 2015November 1, 2013)

SECTION 1

PURPOSE

1.1    The Navistar Non-Employee Directors' Deferred Fee Plan (hereinafter referred to as the "Plan") has been established by Navistar International Corporation (hereinafter referred to as the "Company" or "Navistar") to attract and retain as members of the Board of Directors of the Company (hereinafter referred to as the "Board") persons who are not full-time employees of the Company or any of its subsidiaries, but whose business experience and judgment are a valuable asset to the Company and its subsidiaries. The Plan was originally adopted on August 14, 1995, and subsequently amended as of June 16, 1997 and January 1, 2005 and was amended and restated as of December 16, 2008 and November 1, 2013. This amendment and restatement of the Plan is effective as of February 11November 1, 20153. Any deferred amounts under the Plan that are not subject to Section 409A of the United States Internal Revenue Code of 1986, as amended, including regulations and other applicable authorities promulgated thereunder (the "Code") shall continue to be governed by the terms of the Plan as in effect immediately prior to January 1, 2005.

SECTION 2

DIRECTORS COVERED

2.1    As used in the Plan, the term "Director" means any person who: (A) is now a member of the Board or is hereafter elected to the Board, and (B) is not a full-time employee of the Company or any of its subsidiaries.

SECTION 3

DEFERRED DIRECTORS' FEES

3.1    Subject to obtaining the consent of the Company at the time a fee deferral election is made, a Director may elect to defer receipt of all or part of the fees otherwise payable in cash for attendance at regular or special meetings (including executive sessions) of the Board or its committees, fees for rendering special services to the Company, and/or the annual Director retainer fees otherwise payable in cash, including retainer fees for chairing thea Board or a committee thereof, as hereinafter provided. A Director may make such a deferral election by filing an election form with the Secretary of the Company (the "Secretary") before the end of whichever of the following periods applies to the Director: (A) within the first 30 days after the Director first becomes eligible to participate in the Plan (or in any other plan with which the Plan is aggregated under Section 409A of the Code), or (B) if that 30-day period has expired, before the close of the Director’s taxable year preceding the taxable year in which the Director will earn the fees to be deferred. At the end of the applicable period, the Director’s deferral election shall be irrevocable. Any election made within the first 30 days after a Director first becomes eligible to participate in the Plan (or in any other plan with which the Plan is aggregated under Section 409A of the Code) shall apply only to fees earned after the month in which the 30 day initial election period lapses. Any election made after such 30-day period shall apply only to fees earned after the end of the Director’s taxable year in which the Director makes such election. A Director may change any election that the Director has made under this Section 3.1 by filing a new election form with the Secretary in accordance with Section 3.1 at any time before the prior election becomes irrevocable.

3.2    All Directors' fees that are deferred in accordance with the provisions of Section 3.1 shall be credited to a deferred cash account for the Director at the time such deferred Director’s fees would otherwise have been payable to such Director. Such deferred cash account shall bear interest, compounded quarterly at the end of each calendar quarter, from the date amounts are credited thereto to the last day of the calendar quarter (or to the date of payment, if earlier) at the rate equivalent to the rate of interest as published on the first day of such quarter by The Wall Street Journal as the "prime" rate or the equivalent thereof.

3.3    A Director may elect to defer, and to allocate to Navistar share units, all or any portion of the fees that would otherwise be payable to such Director in cash or Navistar common stock for service as a Director. Such deferral shall be subject to mutual agreement between the Company and the Director, and the making of an election in accordance with the requirements set forth in Section 3.1. Any election to allocate a deferral to Navistar share units will be subject to the availability of sufficient shares authorized for this purpose under the Navistar International Corporation 2013 Performance Incentive Plan (or any successor plan thereto), as amended from time to time (hereinafter referred to as the "PIP"). If insufficient shares are then available under the PIP to fully satisfy all Directors’ elections to allocate deferrals to Navistar share units for a given period, then the elections for

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such period will be appropriately reduced pro-rata. If all or any portion of a Director’s election cannot be made under the PIP, then all or such portion of the Director’s deferral election will instead be allocated to such Director’s deferred cash account.

3.4    For each year for which an election under Section 3.3 is in effect, share units shall be credited to a deferred stock account for the Director. The number of share units credited shall equal (a) in the case of any fees that would otherwise be payable to the Director in Navistar common stock, including restricted common stock, the number of shares of Navistar common stock for which the election is effective, and (b) in the case of fees that would otherwise be payable to the Director in cash, the number of whole shares of Navistar common stock with a fair market value (as determined under the PIP) equal to the amount of such cash due,determined based on the average of the high and low publicly reported sale prices of a share of Navistar common stock on the date such cash otherwise would have been paid. Any share units that are provided in lieu of fees that would have been paid in shares of restricted common stock shall be subject to the same vesting conditions that would have applied to such restricted common stock.

Each Director’s deferred stock account shall be credited with dividend equivalents equal to the dividends that would have been paid on shares on Navistar common stock that are equal in number to the share units then credited to the Director’s deferred stock account. Such dividend equivalent amounts shall be converted immediately into share units of equal fair market value (as determined under the PIP),determined based on the average of the high and low publicly reported sale prices of a share of Navistar common stock on the date the dividends are paid on such shares. The amount in the deferred stock account shall be adjusted for stock splits, stock dividends and similar transactions. Interest shall not be credited to the deferred stock account. Any additional share units credited pursuant to this paragraph shall be subject to any vesting conditions that apply to the share units to which such additional share units are attributable.

Notwithstanding the foregoing, to the extent that insufficient shares are then available under the PIP to satisfy the dividend equivalents required to be credited pursuant to this section for any given period, the dollar amount of such dividend equivalents will instead be credited to the applicable deferred cash account for such Director.

The share units in each year’s deferred stock account shall be paid to the Director on the date or event specified in the agreement and election made pursuant to Section 3.3. The share units shall be paid in shares of Navistar common stock and issued pursuant to the PIP, except that the Company may pay cash in lieu of any block of less than 100 shares. Any cash payment shall be equal to the number of share units being paid in cash multiplied by the fair market value of a share of Navistar common stock (as determined under the PIPbased on the average of the high and low publicly reported sale prices of a share of Navistar common stock on the date as of which payment is made). Any shares paid to a Director shall be subject to such restrictions or conditions as otherwise provided under this Plan or the PIP, as appropriate. Prior to the distribution of shares to the Director, the Director shall not be the owner of such shares, and shall have none of the rights of a shareholder with respect to any share units or other amounts credited to the deferred stock account.

If there are no publicly reported sales of shares of Navistar common stock on an applicable date under this Section 3.4, the value of a share or share unit for purposes of this Section 3.4 shall be based on publicly reported sales of such shares occuring on such other date or dates as the Company considers appropriate.

SECTION 4

PAYMENT OF DEFERRED DIRECTORS' FEES

4.1    Subject to the provisions of this Section 4.1, Section 4.2, and Section 4.3, a Director shall elect, in accordance with the provisions of Section 3.1, one of the following payment options with respect to any earned and vested amounts that are credited to such Director’s deferred cash account and deferred stock account, as described in Sections 3.2 and 3.4, respectively:

(a) a lump sum payment within 60 days of any January 1 (designated by the Director) following the taxable year in which such fees would have been paid if payment of such fees had not been deferred;

(b) a lump sum payment within 60 days following the Director’s separation from service with the Company and its affiliates (as determined in accordance with Section 409A of the Code); or

(c) annual installments (over a 2-year, 3-year, 4-year, 5-year, or 10-year period, as designated by the Director) beginning within 60 days following the Director’s separation from service with the Company and its affiliates (as determined in accordance with Section 409A of the Code). The amount of each installment shall be equal to a fraction of the then-unpaid portion of any earned and vested amounts credited to the Director’s deferred cash account and deferred stock account; the numerator of the fraction shall be one, and the denominator of the fraction shall be the number of installments that have not yet been paid.

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4.2    In the event of a Director’s death, any and all earned and vested amounts that are then credited to the Director's deferred cash account and deferred stock account, as described in Sections 3.2 and 3.4, respectively, shall be paid to the Director’s beneficiary within 60 days after the Director’s death.

4.3    In the event of a "Change in Control," as defined below, any and all earned and vested amounts that are then credited to a Director’s deferred cash account and deferred stock account, as described in Sections 3.2 and 3.4, respectively, shall be paid to the Director immediately.

4.4    For purposes of the Plan, a "Change in Control" shall be deemed to have occurred upon (a) a “change in ownership” of the Company, (b) a “change in effective control” of the Company, or (c) a “change in the ownership of a substantial portion of the assets” of the Company. For purposes this Section 4.4, the terms “change in ownership,” “change in effective control,” and “change in the ownership of a substantial portion of the assets” shall have the meanings assigned to such terms under Section 409A of the Code.

SECTION 5

MISCELLANEOUS

5.1    The Plan does not give the Director any right to be nominated or re-elected to the Board.

5.2    When a person entitled to a payment under the Plan is under legal disability or, in the Company's opinion, is in any way incapacitated so as to be unable to manage such person's financial affairs, the Company may direct that payment be made to such person's legal representative, or to a relative or friend of such person for such person's benefit. Any payment made in accordance with the preceding sentence shall be in complete discharge of the Company's obligation to make such payment under the Plan.

5.3    Any action required or permitted to be taken by the Company under the terms of the Plan shall be by affirmative vote of a majority of the members of the Board of Directors then in office.

5.4    Any controversy or claim arising out of or relating to the Plan or the breach hereof shall be settled by arbitration in the City of Chicago in accordance with the laws of the State of Illinois by three arbitrators, of whom one shall be appointed by the Company, one by the Director and one by the first two arbitrators. If the first two arbitrators cannot agree on the appointment of a third arbitrator, then the third arbitrator shall be appointed by the Chief Judge of the United States Court of Appeals for the Seventh Circuit. The arbitration shall be conducted in accordance with the rules of the American Arbitration Association except with respect to the selection of arbitrators which shall be as provided in this Section 5.4. Judgment upon any award rendered by the arbitrators may be entered in any court having jurisdiction thereof and will include interest on any amounts due and payable to the Director from the date of the breach of the Plan calculated for each month at the rate equal to the prime rate as published in The Wall Street Journal on the first date of its publication in the then current year. In the event that it shall be necessary or desirable for the Director to retain legal counsel and/or incur other costs and expenses in connection with the enforcement of any or all of the Director's rights under the Plan, the Company shall pay (or the Director shall be entitled to reimbursement from the Company, as the case may be) reasonable attorney's fees and costs and expenses in connection with the enforcement of said rights (including the enforcement of any arbitration award in court) (collectively, the “Expenses”), unless the arbitrators determine that the Director's request to arbitrate was frivolous, in which case the Director shall promptly repay to the Company any previous payments or reimbursements made by the Company for Expenses under this Section 5.4 in respect of the Director. All such payments or reimbursements under this Section 5.4 shall be made on or prior to the last day of the taxable year of the Director following the taxable year in which such Expenses were incurred by the Director (provided that to the extent any such payment or reimbursement is taxable income to the Director and is otherwise subject to the requirements of Section 409A of the Code, such payment or reimbursement shall be made no later than March 15th of the taxable year of the Director following the taxable year in which such Expenses were incurred by the Director). No such payment or reimbursement provided to the Director during any taxable year shall in any way affect the Expenses eligible for payment or reimbursement in any other taxable year, and the right to such payment or reimbursement may not be liquidated or exchanged for another benefit.

5.5    Any notices, requests, demands or other communications provided for by the Plan shall be sufficient if in writing and if sent by registered or certified mail, return receipt requested, to the Director at the last address filed in writing with the Company or, in the case of the Company, to the Company at its principal executive offices, attention Secretary.

5.6    The provisions of the Plan shall be construed in accordance with applicable federal laws and, to the extent not inconsistent therewith or preempted thereby, the laws of the State of Illinois, determined without regard to the choice of law rules of any jurisdiction.

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5.7    The Plan may be amended or canceled by the Company, in its sole discretion, without the consent of any other person, and, no person, other than Directors who participate in the Plan, shall have any rights under or interest in the Plan or the subject matter hereof. Unless the Plan is amended to so provide, the cancellation of the Plan shall not cause the date on which any payment is made under the Plan to be accelerated.

5.8    All provisions of the Plan shall inure to the benefit of and be binding upon the successors and assigns of the Company (including any successor to, or assignee of, the assets or business of the Company pursuant to a transaction constituting a Change in Control (as defined in Section 4.4)), and the term "Company" as used herein shall include Navistar International Corporation and all such successors and assigns.

5.9    Each Director may, from time to time, name a beneficiary or beneficiaries (who may be named on a contingent or successive basis) to whom any benefit under the Plan is to be paid in the event of the Director’s death before the Director receives any or all of such benefit. Each such designation shall revoke all prior designations by the same Director and shall be effective only if and when filed by the Director with the Company during the Director’s lifetime. In the absence of any such designation, benefits remaining unpaid at the Director’s death shall be paid to the Director’s estate.

5.10    The Plan shall be unfunded. Any rights that a Director has to a payment or distribution under the Plan shall be limited to those of a general and unsecured creditor of the Company.

5.11    No loans shall be permitted under the Plan.

5.12    No rights or interests under the Plan shall be assignable or transferable other than by will or the laws of descent and distribution, and such rights or interests shall be exercisable, during the Director’s lifetime, only by the Director.

5.13    All payments, including the issuance of shares of Navistar common stock, under the Plan shall be subject to all applicable laws, rules, and regulations, and to such approvals by any governmental agencies or national securities exchanges as may be required.

5.14    If and to the extent any payments or benefits under the Plan are subject to and would otherwise violate the requirements under Section 409A of the Code, (a) such payments and benefits shall be paid under such other conditions determined by the Company that cause such payments or benefits to comply with Section 409A of the Code and the Plan shall, to the extent necessary, be construed, administered, and/or amended (if and only to the extent such an amendment would be permitted under Section 409A of the Code) accordingly to achieve that objective, (b) any reference herein to the term “Plan” shall mean this Plan and any other plan with which this Plan is required to be aggregated under Section 409A of the Code, and (c) in the event of any inconsistency between the terms of this Plan and Section 409A of the Code, the terms of Section 409A of the Code shall prevail and govern. Additionally, if, as of the date of the Director’s “separation from service” from the Company, the Director is a “specified employee” (within the meaning of Section 409A), then, to the extent that payments or benefits under the Plan would, absent this section, be paid on account of the Director’s “separation from service” from the Company and within the six-month period following such separation, such payments shall not be paid until the date that is six months and one day after such separation from service (or, if earlier, the Director’s death), with any such installments that are required to be delayed being accumulated during the six-month period and paid in a lump sum on the date that is six months and one day following the Director’s separation from service and any subsequent installments, if any, being paid in accordance with the dates and terms set forth herein.

* * * * * * *

E-18

EX-31.1

EXHIBIT 31.1

CERTIFICATION

I, Troy A. Clarke, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Navistar International Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's Board of Directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: June 4, 2015

/s/     TROY A. CLARKE

Troy A. Clarke

President and Chief Executive Officer

(Principal Executive Officer)

E-19

EX-31.2

EXHIBIT 31.2

CERTIFICATION

I, Walter G. Borst, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Navistar International Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's Board of Directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: June 4, 2015

/s/     WALTER G. BORST        

Walter G. Borst

Executive Vice President and Chief Financial Officer

(Principal Financial Officer)

E-20

EX-32.1

EXHIBIT 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Navistar International Corporation (the “Company”) on Form 10-Q for the period ended April 30, 2015 as filed with the Securities and Exchange Commission (the “SEC”) on the date hereof (the “Report”), I, Troy A. Clarke, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

A signed original of this written statement required by Section 906 of the Sarbanes-Oxley Act of 2002 has been provided to the Company and will be retained by the Company and furnished to the SEC or its staff upon request.

Date: June 4, 2015

/s/     TROY A. CLARKE

Troy A. Clarke

President and Chief Executive Officer

(Principal Executive Officer)

This certification accompanies the Report pursuant to § 906 of the Sarbanes-Oxley Act of 2002 and shall not be deemed filed by the Company for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section. This certification shall also not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, except to the extent that the Company specifically incorporates it by reference.

E-21

EX-32.2

EXHIBIT 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Navistar International Corporation (the “Company”) on Form 10-Q for the period ended April 30, 2015 as filed with the Securities and Exchange Commission (the “SEC”) on the date hereof (the “Report”), I, Walter G. Borst, Principal Financial Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

A signed original of this written statement required by Section 906 of the Sarbanes-Oxley Act of 2002 has been provided to the Company and will be retained by the Company and furnished to the SEC or its staff upon request.

Date: June 4, 2015

/s/ WALTER G. BORST

Walter G. Borst

Executive Vice President and Chief Financial Officer

(Principal Financial Officer)

This certification accompanies the Report pursuant to § 906 of the Sarbanes-Oxley Act of 2002 and shall not be deemed filed by the Company for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section. This certification shall also not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, except to the extent that the Company specifically incorporates it by reference.

E-22

EX-99.1

EXHIBIT 99.1

Additional Financial Information (Unaudited)

The following additional financial information is provided based upon the continuing interest of certain stockholders and creditors to assist them in understanding our core Manufacturing operations and our Financial Services operations on an after-tax equity basis. Our Manufacturing operations, for this purpose, include our Truck segment, Parts segment, Global Operations segment, and Corporate items. The Manufacturing operations financial information represents non-GAAP financial measures. These non-GAAP financial measures should be considered supplemental to, and not as a substitute for, or superior to, financial measures calculated in accordance with U.S. GAAP. The reconciling differences between these non-GAAP financial measures and our U.S. GAAP condensed consolidated financial statements in Item 1, Financial Statements, are our Financial Services operations, which are included on an after-tax equity basis. Certain of our subsidiaries in our Manufacturing operations have debt outstanding with our Financial Services operations (“intercompany debt”). In the condensed statements of assets, liabilities, and stockholders' equity (deficit), the intercompany debt is reflected as accounts payable. The change in the intercompany debt is reflected in the net cash provided by operating activities in the condensed statements of cash activity.

Condensed Statements of Revenues and Expenses

Navistar International Corporation

(Manufacturing operations with financial services operations on an after-tax equity basis)

	For the Three Months Ended April 30, 2015
(in millions)	Manufacturing Operations			Financial Services Operations			Adjustments			Consolidated Statement of Operations
Sales of manufactured products	$	2,658		$	—		$	—		$	2,658
Finance revenues	—			60			(25		)	35
Sales and revenues, net	2,658			60			(25		)	2,693
Costs of products sold	2,360			—			—			2,360
Restructuring charges	6			—			—			6
Asset impairment charges	1			—			—			1
Selling, general and administrative expenses	220			24			(1		)	243
Engineering and product development costs	76			—			—			76
Interest expense	60			18			(3		)	75
Other income, net	(3		)	(4		)	(21		)	(28		)
Total costs and expenses	2,720			38			(25		)	2,733
Equity in income of non-consolidated affiliates	1			—			—			1
Income (loss) before equity income from financial services operations and income taxes	(61		)	22			—			(39		)
Equity income (loss) from financial services operations	15			—			(15		)	—
Income (loss) from continuing operations before income taxes	(46		)	22			(15		)	(39		)
Income tax expense	(11		)	(7		)	—			(18		)
Income (loss) from continuing operations	(57		)	15			(15		)	(57		)
Income from discontinued operations, net of tax	—			—			—			—
Net income (loss)	(57		)	15			(15		)	(57		)
Less: Income attributable to non-controlling interests	7			—			—			7
Net income (loss) attributable to Navistar International Corporation	$	(64	)	$	15		$	(15	)	$	(64	)

E-23

	For the Six Months Ended April 30, 2015
(in millions)	Manufacturing Operations			Financial Services Operations			Adjustments			Consolidated Statement of Operations
Sales of manufactured products	$	5,043		$	—		$	—		$	5,043
Finance revenues	—			120			(49		)	71
Sales and revenues, net	5,043			120			(49		)	5,114
Costs of products sold	4,405			—			—			4,405
Restructuring charges	9			—			—			9
Asset impairment charges	8			—			—			8
Selling, general and administrative expenses	439			47			(2		)	484
Engineering and product development costs	155			—			—			155
Interest expense	120			38			(6		)	152
Other (income) expense, net	21			(11		)	(41		)	(31		)
Total costs and expenses	5,157			74			(49		)	5,182
Equity in income of non-consolidated affiliates	3			—			—			3
Income (loss) before equity income from financial services operations and income taxes	(111		)	46			—			(65		)
Equity income (loss) from financial services operations	30			—			(30		)	—
Income (loss) from continuing operations before income taxes	(81		)	46			(30		)	(65		)
Income tax expense	(9		)	(16		)	—			(25		)
Income (loss) from continuing operations	(90		)	30			(30		)	(90		)
Income from discontinued operations, net of tax	—			—			—			—
Net income (loss)	(90		)	30			(30		)	(90		)
Less: Income attributable to non-controlling interests	16			—			—			16
Net income (loss) attributable to Navistar International Corporation	$	(106	)	$	30		$	(30	)	$	(106	)

E-24

Condensed Statements of Revenues and Expenses

Navistar International Corporation

(Manufacturing operations with financial services operations on an after-tax equity basis)

	For the Three Months Ended April 30, 2014
(in millions)	Manufacturing Operations			Financial Services Operations			Adjustments			Consolidated Statement of Operations
Sales of manufactured products	$	2,708		$	—		$	—		$	2,708
Finance revenues	—			57			(19		)	38
Sales and revenues, net	2,708			57			(19		)	2,746
Costs of products sold	2,468			—			—			2,468
Restructuring charges	7			1			—			8
Asset impairment charges	150			1			—			151
Selling, general and administrative expenses	216			22			(1		)	237
Engineering and product development costs	83			—			—			83
Interest expense	57			17			—			74
Other (income) expense, net	19			(9		)	(18		)	(8		)
Total costs and expenses	3,000			32			(19		)	3,013
Equity in income of non-consolidated affiliates	3			—			—			3
Income (loss) before equity income from financial services operations and income taxes	(289		)	25			—			(264		)
Equity income (loss) from financial services operations	16			—			(16		)	—
Income (loss) from continuing operations before income taxes	(273		)	25			(16		)	(264		)
Income tax expense	(14		)	(9		)	—			(23		)
Income (loss) from continuing operations	(287		)	16			(16		)	(287		)
Income from discontinued operations, net of tax	1			—			—			1
Net income (loss)	(286		)	16			(16		)	(286		)
Less: Income attributable to non-controlling interests	11			—			—			11
Net income (loss) attributable to Navistar International Corporation	$	(297	)	$	16		$	(16	)	$	(297	)

E-25

	For the Six Months Ended April 30, 2014
(in millions)	Manufacturing Operations			Financial Services Operations			Adjustments			Consolidated Statement of Operations
Sales of manufactured products	$	4,877		$	—		$	—		$	4,877
Finance revenues	—			112			(35		)	77
Sales and revenues, net	4,877			112			(35		)	4,954
Costs of products sold	4,482			—			—			4,482
Restructuring charges	10			1			—			11
Asset impairment charges	168			1			—			169
Selling, general and administrative expenses	432			46			(2		)	476
Engineering and product development costs	173			—			—			173
Interest expense	122			34			—			156
Other (income) expense, net	56			(17		)	(33		)	6
Total costs and expenses	5,443			65			(35		)	5,473
Equity in income of non-consolidated affiliates	3			—			—			3
Income (loss) before equity income from financial services operations and income taxes	(563		)	47			—			(516		)
Equity income (loss) from financial services operations	30			—			(30		)	—
Income (loss) from continuing operations before income taxes	(533		)	47			(30		)	(516		)
Income tax benefit (expense)	6			(17		)	—			(11		)
Income (loss) from continuing operations	(527		)	30			(30		)	(527		)
Income from discontinued operations, net of tax	2			—			—			2
Net income (loss)	(525		)	30			(30		)	(525		)
Less: Income attributable to non-controlling interests	20			—			—			20
Net income (loss) attributable to Navistar International Corporation	$	(545	)	$	30		$	(30	)	$	(545	)

E-26

Condensed Statements of Assets, Liabilities, and Stockholders' Equity (Deficit)

Navistar International Corporation

(Manufacturing operations with financial services operations on an after-tax equity basis)

	As of April 30, 2015
(in millions)	Manufacturing Operations			Financial Services Operations		Adjustments			Consolidated Balance Sheet
Assets
Cash and cash equivalents	$	536		$	47	$	—		$	583
Marketable securities	248			25		—			273
Restricted cash	23			90		—			113
Finance and other receivables, net	520			2,635		(481		)	2,674
Inventories	1,234			11		—			1,245
Goodwill	38			—		—			38
Property and equipment, net	1,163			244		—			1,407
Investments in and advances to financial services operations	585			—		(585		)	—
Investments in non-consolidated affiliates	68			—		—			68
Deferred taxes, net	156			16		—			172
Other assets	328			24		—			352
Total assets	$	4,899		$	3,092	$	(1,066	)	$	6,925
Liabilities and stockholders' equity (deficit)
Accounts payable	$	1,902		$	29	$	(481	)	$	1,450
Debt	2,906			2,297		—			5,203
Postretirement benefits liabilities	2,828			38		—			2,866
Other liabilities	2,007			143		—			2,150
Total liabilities	9,643			2,507		(481		)	11,669
Redeemable equity securities	1			—		—			1
Stockholders' equity attributable to non-controlling interest	30			—		—			30
Stockholders' equity (deficit) attributable to controlling interest	(4,775		)	585		(585		)	(4,775		)
Total liabilities and stockholders' equity (deficit)	$	4,899		$	3,092	$	(1,066	)	$	6,925

E-27

Condensed Statements of Assets, Liabilities, and Stockholders' Equity (Deficit)

Navistar International Corporation

(Manufacturing operations with financial services operations on an after-tax equity basis)

	As of October 31, 2014
(in millions)	Manufacturing Operations			Financial Services Operations		Adjustments			Consolidated Balance Sheet
Assets
Cash and cash equivalents	$	440		$	57	$	—		$	497
Marketable securities	578			27		—			605
Restricted cash	22			149		—			171
Finance and other receivables, net	579			2,650		(613		)	2,616
Inventories	1,303			16		—			1,319
Goodwill	38			—		—			38
Property and equipment, net	1,294			268		—			1,562
Investments in and advances to financial services operations	698			—		(698		)	—
Investments in non-consolidated affiliates	73			—		—			73
Deferred taxes, net	183			17		—			200
Other assets	335			27		—			362
Total assets	$	5,543		$	3,211	$	(1,311	)	$	7,443
Liabilities and stockholders' equity (deficit)
Accounts payable	$	2,144		$	33	$	(613	)	$	1,564
Debt	2,958			2,266		—			5,224
Postretirement benefits liabilities	2,916			40		—			2,956
Other liabilities	2,143			174		—			2,317
Total liabilities	10,161			2,513		(613		)	12,061
Redeemable equity securities	2			—		—			2
Stockholders' equity attributable to non-controlling interest	34			—		—			34
Stockholders' equity (deficit) attributable to controlling interest	(4,654		)	698		(698		)	(4,654		)
Total liabilities and stockholders' equity (deficit)	$	5,543		$	3,211	$	(1,311	)	$	7,443

E-28

Condensed Statements of Cash Flows

Navistar International Corporation

(Manufacturing operations with financial services operations on an after-tax equity basis)

	For the Six Months Ended April 30, 2015
(in millions)	Manufacturing Operations			Financial Services Operations			Adjustments			Condensed Consolidated Statement of Cash Flows
Cash flows from operating activities
Net income (loss)	$	(90	)	$	30		$	(30	)	$	(90	)
Adjustments to reconcile net income (loss) to cash used in operating activities:
Depreciation and amortization	117			1			—			118
Depreciation of equipment leased to others	12			23			—			35
Amortization of debt issuance costs and discount	12			7			—			19
Deferred income taxes	(7		)	—			—			(7		)
Asset impairment charges	4			4			—			8
Equity in loss of non-consolidated affiliates	(3		)	—			—			(3		)
Equity in income of financial services affiliates	(30		)	—			30			—
Dividends from financial services operations	125			(125		)	—			—
Dividends from non-consolidated affiliates	8			—			—			8
Change in intercompany receivables and payables	(52		)	52			—			—
Other, net	(128		)	(197		)	—			(325		)
Net cash used in operating activities	(32		)	(205		)	—			(237		)
Cash flows from investing activities
Purchases of marketable securities	(162		)	—			—			(162		)
Sales of marketable securities	430			1			—			431
Maturities of marketable securities	63			—			—			63
Net change in restricted cash and cash equivalents	(1		)	54			—			53
Capital expenditures	(43		)	(2		)	—			(45		)
Purchase of equipment leased to others	—			(20		)	—			(20		)
Other investing activities	8			4			—			12
Net cash provided by investing activities	295			37			—			332
Net cash provided by (used in) financing activities	(132		)	149			—			17
Effect of exchange rate changes on cash and cash equivalents	(35		)	9			—			(26		)
Increase (decrease) in cash and cash equivalents	96			(10		)	—			86
Cash and cash equivalents at beginning of the period	440			57			—			497
Cash and cash equivalents at end of the period	$	536		$	47		$	—		$	583

E-29

Condensed Statements of Cash Flows

Navistar International Corporation

(Manufacturing operations with financial services operations on an after-tax equity basis)

	For the Six Months Ended April 30, 2014
(in millions)	Manufacturing Operations			Financial Services Operations			Adjustments			Condensed Consolidated Statement of Cash Flows
Cash flows from operating activities
Net income (loss)	$	(525	)	$	30		$	(30	)	$	(525	)
Adjustments to reconcile net income (loss) to cash provided by (used in) operating activities:
Depreciation and amortization	122			—			—			122
Depreciation of equipment leased to others	42			21			—			63
Amortization of debt issuance costs and discount	21			6			—			27
Deferred income taxes	(2		)	—			—			(2		)
Asset impairment charges	168			1			—			169
Equity in income of financial services affiliates	(30		)	—			30			—
Dividends from non-consolidated affiliates	9			—			—			9
Change in intercompany receivables and payables	(15		)	15			—			—
Other, net	(131		)	(58		)	—			(189		)
Net cash provided by (used in) operating activities	(341		)	15			—			(326		)
Cash flows from investing activities
Purchases of marketable securities	(785		)	(3		)	—			(788		)
Sales of marketable securities	902			—			—			902
Maturities of marketable securities	182			—			—			182
Net change in restricted cash and cash equivalents	4			(25		)	—			(21		)
Capital expenditures	(49		)	(1		)	—			(50		)
Purchase of equipment leased to others	(45		)	(63		)	—			(108		)
Other investing activities	15			10			—			25
Net cash provided by (used in) investing activities	224			(82		)	—			142
Net cash provided by (used in) financing activities	(36		)	69			—			33
Effect of exchange rate changes on cash and cash equivalents	(11		)	1			—			(10		)
Increase (decrease) in cash and cash equivalents	(164		)	3			—			(161		)
Cash and cash equivalents at beginning of the period	727			28			—			755
Cash and cash equivalents at end of the period	$	563		$	31		$	—		$	594

E-30

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Summary of Significant Accounting Policies - Product Warranty Liability (Details) (USD $) In Millions, except Per Share data, unless otherwise specified	6 Months Ended		3 Months Ended
	Apr. 30, 2015	Apr. 30, 2014	Apr. 30, 2015	Apr. 30, 2014	Jan. 31, 2015	Jan. 31, 2014	Oct. 31, 2014	Oct. 31, 2013
Product Liability Contingency [Line Items]
Product Warranty Accrual	$ 1,059	$ 1,323	$ 1,059	$ 1,323			$ 1,197	$ 1,349
Product Warranty Accrual, Warranties Issued	116	153
Product Warranty Accrual, Currency Translation, Increase (Decrease)	(5)	(1)
Accrued Product Warranty And Deferred Warranty Revenue, Standard And Extended Warranty Programs, Roll Forward:
Adjustments to pre-existing warranties(A)(B)	(39)	94
Extended Warranty Program:
Product Warranty Accrual, Payments	(210)	(272)
Product Warranty Accrual, Current	496	626	496	626
Product Warranty Accrual, Noncurrent	563	697	563	697
Extended Warranty Programs [Member]
Extended Warranty Program:
Deferred Revenue, Revenue Recognized	75	60	38	33
Deferred Revenue	425		425				437
Product Warranty Accrual [Member]
Accrued Product Warranty And Deferred Warranty Revenue, Standard And Extended Warranty Programs, Roll Forward:
Adjustments to pre-existing warranties(A)(B)				$ 42	$ (57)	$ 52
Product Warranty Accrual, Preexisting Increase Decrease Per Share, Net of Tax				$ 0.52	$ (0.70)	$ 0.64

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Postretirement Benefits - Schedule of Net Benefit (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended
	Apr. 30, 2015	Apr. 30, 2014	Apr. 30, 2015	Apr. 30, 2014
Pension Benefits
Defined Benefit Plan Disclosure [Line Items]
Service cost	$ 3	$ 2	$ 6	$ 6
Interest on obligations	35	40	71	79
Amortization of cumulative loss	24	23	49	47
Amortization of cumulative loss	0	0	0	0
Contractual termination benefits	(1)	0	(1)	0
Premiums on pension insurance	4	0	5	0
Expected return on assets	(48)	(48)	(97)	(96)
Net postretirement benefits expense	17	17	33	36
Health and Life Insurance Benefits
Defined Benefit Plan Disclosure [Line Items]
Service cost	2	1	3	2
Interest on obligations	18	17	36	34
Amortization of cumulative loss	9	4	19	8
Amortization of cumulative loss	(1)	(1)	(2)	(2)
Contractual termination benefits	(1)	0	(1)	0
Premiums on pension insurance	0	0	0	0
Expected return on assets	(8)	(8)	(15)	(16)
Net postretirement benefits expense	$ 19	$ 13	$ 40	$ 26

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Allowance for Doubtful Accounts - Schedule of Allowance Aging Analysis (Details) (USD $) In Millions, unless otherwise specified	Apr. 30, 2015	Oct. 31, 2014
Financing Receivable, Recorded Investment, Past Due [Line Items]
Finance Receivables, Current	$ 2,101	$ 1,976
30-90 days past due	57	66
Over 90 days past due	24	23
Total finance receivables	2,182	2,065
Retail Portfolio [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Finance Receivables, Current	586	643
30-90 days past due	57	64
Over 90 days past due	24	19
Total finance receivables	667	726
Wholesale Portfolio [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Finance Receivables, Current	1,515	1,333
30-90 days past due	0	2
Over 90 days past due	0	4
Total finance receivables	$ 1,515	$ 1,339

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Stockholders' Deficit Accumulated Other Comprehensive Income (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended
	Apr. 30, 2015	Apr. 30, 2014	Apr. 30, 2015	Apr. 30, 2014
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward]
Accumulated Other Comprehensive Loss, Beginning Balance	$ (2,290)	$ (1,861)	$ (2,263)	$ (1,824)
Other comprehensive loss before reclassifications	(27)	47	(86)	(16)
Amounts reclassified out of accumulated other comprehensive loss	33	26	65	52
Net current-period other comprehensive income (loss)	6	73	(21)	36
Accumulated Other Comprehensive Loss, Ending Balance	(2,284)	(1,788)	(2,284)	(1,788)
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax [Abstract]
Total before tax	(57)	(287)	(90)	(527)
Tax expense	(18)	(23)	(25)	(11)
Net income (loss) attributable to Navistar International Corporation	(64)	(297)	(106)	(545)
Accumulated Net Unrealized Investment Gain (Loss) [Member]
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward]
Accumulated Other Comprehensive Loss, Beginning Balance	1	0	1	0
Other comprehensive loss before reclassifications	0	0	0	0
Amounts reclassified out of accumulated other comprehensive loss	0	0	0	0
Net current-period other comprehensive income (loss)	0	0	0	0
Accumulated Other Comprehensive Loss, Ending Balance	1	0	1	0
Accumulated Translation Adjustment [Member]
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward]
Accumulated Other Comprehensive Loss, Beginning Balance	(186)	(137)	(127)	(75)
Other comprehensive loss before reclassifications	(27)	48	(86)	(14)
Amounts reclassified out of accumulated other comprehensive loss	0	0	0	0
Net current-period other comprehensive income (loss)	(27)	48	(86)	(14)
Accumulated Other Comprehensive Loss, Ending Balance	(213)	(89)	(213)	(89)
Pension Benefits
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward]
Accumulated Other Comprehensive Loss, Beginning Balance	(2,105)	(1,724)	(2,137)	(1,749)
Other comprehensive loss before reclassifications	0	(1)	0	(2)
Amounts reclassified out of accumulated other comprehensive loss	33	26	65	52
Net current-period other comprehensive income (loss)	33	25	65	50
Accumulated Other Comprehensive Loss, Ending Balance	(2,072)	(1,699)	(2,072)	(1,699)
Reclassification out of Accumulated Other Comprehensive Income [Member] | Pension Benefits
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax [Abstract]
Total before tax	33		66
Tax expense	0		(1)
Net income (loss) attributable to Navistar International Corporation	33		65
Reclassification out of Accumulated Other Comprehensive Income [Member] | Pension Benefits | Selling, General and Administrative Expenses [Member]
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax [Abstract]
Amortization of prior service costs	(1)	(1)	(2)	(2)
Amortization of actuarial loss	(34)	27	(68)	54
Total reclassifications for the period (net of tax of $0 at both dates)		$ 26		$ 52

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Income Taxes - Narrative (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended
	Apr. 30, 2015	Apr. 30, 2014	Apr. 30, 2015	Apr. 30, 2014
Operating Loss Carryforwards [Line Items]
Income Tax Expense (Benefit)	$ 18	$ 23	$ 25	$ 11
Income Taxes Percent Likelihood Of Being Realized Upon Settlement	50.00%		50.00%
Unrecognized Tax Benefits	42		42
Unrecognized Tax Benefits, Income Tax Penalties and Interest Expense	1
Other Comprehensive Income (Loss) [Member]
Operating Loss Carryforwards [Line Items]
Income Tax Expense (Benefit)			$ (14)

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Allowance for Doubtful Accounts - Schedule of Allowance for Retail, Wholesale, Trade & Other (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended
	Apr. 30, 2015	Apr. 30, 2014	Apr. 30, 2015		Apr. 30, 2014
Allowance for Doubtful Accounts Receivable [Roll Forward]
Allowance for doubtful accounts at beginning of period	$ 58	$ 60	$ 65		$ 60
Provision for doubtful accounts, net of recoveries	3	4	5	[1]	10	[1]
Charge-off of accounts	0	(5)	(4)	[2]	(7)	[2]
Allowance for doubtful accounts at end of period	58	62	58		62
Loss on Contract Termination for Default	1	1	1		1
Financing Receivable, Allowance for Credit Losses, Other	(3)	3	(8)		(1)
Retail Portfolio [Member]
Allowance for Doubtful Accounts Receivable [Roll Forward]
Allowance for doubtful accounts at beginning of period	23	22	24		21
Provision for doubtful accounts, net of recoveries	3	3	5	[1]	7	[1]
Charge-off of accounts	0	(3)	(1)	[2]	(5)	[2]
Allowance for doubtful accounts at end of period	25	22	25		22
Financing Receivable, Allowance for Credit Losses, Other	(1)	0	(3)		(1)
Wholesale Portfolio [Member]
Allowance for Doubtful Accounts Receivable [Roll Forward]
Allowance for doubtful accounts at beginning of period	3	2	3		2
Provision for doubtful accounts, net of recoveries	0	0	0	[1]	0	[1]
Charge-off of accounts	0	0	0	[2]	0	[2]
Allowance for doubtful accounts at end of period	3	2	3		2
Financing Receivable, Allowance for Credit Losses, Other	0	0	0		0
Trade and Other Receivables [Member]
Allowance for Doubtful Accounts Receivable [Roll Forward]
Allowance for doubtful accounts at beginning of period	32	36	38		37
Provision for doubtful accounts, net of recoveries	0	1	0	[1]	3	[1]
Charge-off of accounts	0	(2)	(3)	[2]	(2)	[2]
Allowance for doubtful accounts at end of period	30	38	30		38
Financing Receivable, Allowance for Credit Losses, Other	$ (2)	$ 3	$ (5)		$ 0

[1] (A)

[2] We repossess sold and leased vehicles on defaulted finance receivables and leases, and place them into Inventories. Losses recognized at the time of repossession and charged against the allowance for doubtful accounts were both less than $1 million, for the three and six months ended April 30, 2015, as well as for the three and six months ended April 30, 2014

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Segment Reporting (Tables)

6 Months Ended

Apr. 30, 2015

Segment Reporting [Abstract]

Schedule of selected financial information, by segment

(in millions)	Truck		Parts		Global Operations		Financial Services		Corporate and Eliminations		Total
Segment assets, as of:
April 30, 2015	$	2,104	$	669	$	514	$	2,611	$	1,027	$	6,925
October 31, 2014	2,245		672		657		2,598		1,271		7,443

_________________________

(A) Total sales and revenues in the Financial Services segment include interest revenues of $44 million and $89 million for the three and six months ended April 30, 2015, respectively and $42 million and $82 million for the three and six months ended April 30, 2014, respectively.

(B) During the second quarter of 2015, we identified a $35 million adjustment related to the first quarter of 2015 Intersegment sales and revenues. As a result, the Truck segment and Corporate and Eliminations should have reported Intersegment sales and revenues of $39 million and $(89) million, respectively, and reported Total sales and revenues, net, of $1,670 million and $(87) million, respectively, for the three months ended January 31, 2015. The adjustment did not impact the consolidated results for the first quarter of 2015.

(C) Exclusive of purchases of equipment leased to others.

(in millions)	Truck			Parts		Global Operations			Financial Services(A)		Corporate and Eliminations			Total
Six Months Ended April 30, 2014
External sales and revenues, net	$	3,220		$	1,188	$	469		$	77	$	—		$	4,954
Intersegment sales and revenues	120			28		14			35		(197		)	—
Total sales and revenues, net	$	3,340		$	1,216	$	483		$	112	$	(197	)	$	4,954
Income (loss) from continuing operations attributable to NIC, net of tax	$	(337	)	$	241	$	(197	)	$	47	$	(301	)	$	(547	)
Income tax expense	—			—		—			—		(11		)	(11		)
Segment profit (loss)	$	(337	)	$	241	$	(197	)	$	47	$	(290	)	$	(536	)
Depreciation and amortization	$	129		$	8	$	14		$	21	$	13		$	185
Interest expense	—			—		—			34		122			156
Equity in income (loss) of non-consolidated affiliates	2			2		(1		)	—		—			3
Capital expenditures(C)	38			5		4			1		2			50

(in millions)	Truck			Parts		Global Operations			Financial Services(A)		Corporate and Eliminations			Total
Six Months Ended April 30, 2015
External sales and revenues, net	$	3,564		$	1,221	$	253		$	71	$	5		$	5,114
Intersegment sales and revenues(B)	72			18		29			49		(168		)	—
Total sales and revenues, net	$	3,636		$	1,239	$	282		$	120	$	(163	)	$	5,114
Income (loss) from continuing operations attributable to NIC, net of tax	$	(69	)	$	278	$	(14	)	$	46	$	(347	)	$	(106	)
Income tax expense	—			—		—			—		(25		)	(25		)
Segment profit (loss)	$	(69	)	$	278	$	(14	)	$	46	$	(322	)	$	(81	)
Depreciation and amortization	$	99		$	7	$	12		$	24	$	11		$	153
Interest expense	—			—		—			38		114			152
Equity in income (loss) of non-consolidated affiliates	3			2		(2		)	—		—			3
Capital expenditures(C)	38			—		3			2		2			45

(in millions)	Truck			Parts		Global Operations			Financial Services(A)		Corporate and Eliminations			Total
Three Months Ended April 30, 2015
External sales and revenues, net	$	1,933		$	607	$	115		$	35	$	3		$	2,693
Intersegment sales and revenues(B)	33			6		15			25		(79		)	—
Total sales and revenues, net	$	1,966		$	613	$	130		$	60	$	(76	)	$	2,693
Income (loss) from continuing operations attributable to NIC, net of tax	$	(51	)	$	133	$	1		$	22	$	(169	)	$	(64	)
Income tax expense	—			—		—			—		(18		)	(18		)
Segment profit (loss)	$	(51	)	$	133	$	1		$	22	$	(151	)	$	(46	)
Depreciation and amortization	$	47		$	4	$	5		$	12	$	6		$	74
Interest expense	—			—		—			18		57			75
Equity in income (loss) of non-consolidated affiliates	1			1		(1		)	—		—			1
Capital expenditures(C)	24			—		1			2		1			28

(in millions)	Truck			Parts		Global Operations			Financial Services(A)		Corporate and Eliminations			Total
Three Months Ended April 30, 2014
External sales and revenues, net	$	1,829		$	614	$	265		$	38	$	—		$	2,746
Intersegment sales and revenues	60			16		6			19		(101		)	—
Total sales and revenues, net	$	1,889		$	630	$	271		$	57	$	(101	)	$	2,746
Income (loss) from continuing operations attributable to NIC, net of tax	$	(129	)	$	133	$	(162	)	$	24	$	(164	)	$	(298	)
Income tax expense	—			—		—			—		(23		)	(23		)
Segment profit (loss)	$	(129	)	$	133	$	(162	)	$	24	$	(141	)	$	(275	)
Depreciation and amortization	$	71		$	4	$	6		$	11	$	7		$	99
Interest expense	—			—		—			17		57			74
Equity in income of non-consolidated affiliates	1			1		1			—		—			3
Capital expenditures(C)	26			1		1			—		1			29

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Condensed Consolidating Guarantor and Non-Guarantor Financial Information - Statement of Operations (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended
	Apr. 30, 2015	Apr. 30, 2014	Apr. 30, 2015	Apr. 30, 2014
Sales and revenues, net	$ 2,693	$ 2,746	$ 5,114	$ 4,954
Costs of products sold	2,360	2,468	4,405	4,482
Restructuring charges	6	8	9	11
Asset impairment charges	1	151	8	169
All other operating expenses (income)	366	386	760	811
Total costs and expenses	2,733	3,013	5,182	5,473
Equity in income of non-consolidated affiliates	1	3	3	3
Income (loss) before income taxes	(39)	(264)	(65)	(516)
Income tax expense	(18)	(23)	(25)	(11)
Total before tax	(57)	(287)	(90)	(527)
Income from discontinued operations, net of tax	0	1	0	2
Net income (loss)	(57)	(286)	(90)	(525)
Less: Net income attributable to non-controlling interests	7	11	16	20
Net income (loss) attributable to Navistar International Corporation	(64)	(297)	(106)	(545)
Parent Company [Member]
Sales and revenues, net	0	0	0	0
Costs of products sold	0	0	0	0
Restructuring charges	0	0	0	0
Asset impairment charges	0	0	0	0
All other operating expenses (income)	27	41	50	77
Total costs and expenses	27	41	50	77
Equity in income of non-consolidated affiliates	(37)	(269)	(56)	(481)
Income (loss) before income taxes	(64)	(310)	(106)	(558)
Income tax expense	0	13	0	13
Total before tax	(64)	(297)	(106)	(545)
Income from discontinued operations, net of tax	0	0	0	0
Net income (loss)	(64)	(297)	(106)	(545)
Less: Net income attributable to non-controlling interests	0	0	0	0
Net income (loss) attributable to Navistar International Corporation	(64)	(297)	(106)	(545)
Guarantor Subsidiaries [Member]
Sales and revenues, net	2,009	1,893	3,619	3,317
Costs of products sold	1,864	1,797	3,273	3,222
Restructuring charges	0	8	3	10
Asset impairment charges	1	0	8	0
All other operating expenses (income)	282	273	546	514
Total costs and expenses	2,147	2,078	3,830	3,746
Equity in income of non-consolidated affiliates	64	(141)	79	(152)
Income (loss) before income taxes	(74)	(326)	(132)	(581)
Income tax expense	(1)	(8)	(2)	(1)
Total before tax	(75)	(334)	(134)	(582)
Income from discontinued operations, net of tax	0	0	0	0
Net income (loss)	(75)	(334)	(134)	(582)
Less: Net income attributable to non-controlling interests	0	0	0	0
Net income (loss) attributable to Navistar International Corporation	(75)	(334)	(134)	(582)
Non-Guarantor Subsidiaries [Member]
Sales and revenues, net	1,943	2,061	3,711	3,790
Costs of products sold	1,735	1,862	3,305	3,393
Restructuring charges	6	0	6	1
Asset impairment charges	0	153	0	171
All other operating expenses (income)	79	89	204	248
Total costs and expenses	1,820	2,104	3,515	3,813
Equity in income of non-consolidated affiliates	0	2	1	1
Income (loss) before income taxes	123	(41)	197	(22)
Income tax expense	(17)	(28)	(23)	(23)
Total before tax	106	(69)	174	(45)
Income from discontinued operations, net of tax	0	1	0	2
Net income (loss)	106	(68)	174	(43)
Less: Net income attributable to non-controlling interests	7	11	16	20
Net income (loss) attributable to Navistar International Corporation	99	(79)	158	(63)
Consolidation, Eliminations [Member]
Sales and revenues, net	(1,259)	(1,208)	(2,216)	(2,153)
Costs of products sold	(1,239)	(1,191)	(2,173)	(2,133)
Restructuring charges	0	0	0	0
Asset impairment charges	0	(2)	0	(2)
All other operating expenses (income)	(22)	(17)	(40)	(28)
Total costs and expenses	(1,261)	(1,210)	(2,213)	(2,163)
Equity in income of non-consolidated affiliates	(26)	411	(21)	635
Income (loss) before income taxes	(24)	413	(24)	645
Income tax expense	0	0	0	0
Total before tax	(24)	413	(24)	645
Income from discontinued operations, net of tax	0	0	0	0
Net income (loss)	(24)	413	(24)	645
Less: Net income attributable to non-controlling interests	0	0	0	0
Net income (loss) attributable to Navistar International Corporation	$ (24)	$ 413	$ (24)	$ 645

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Fair Value Measurements - Level 3 Reconciliation (Details) (Guarantees [Member], USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended
	Apr. 30, 2015	Apr. 30, 2014	Apr. 30, 2015	Apr. 30, 2014
Guarantees [Member]
Fair Value Assets And Liablities Measured On Recurring Basis Unobservable Input Reconciliation [Line Items]
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset (Liability) Beginning Value	$ (8)	$ (6)	$ (8)	$ (6)
Transfers out of Level 3	0	0	0	0
Issuances	0	0	0	0
Settlements	1	0	1	0
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset (Liability) Ending Value	(7)	(6)	(7)	(6)
Change in unrealized gains on assets and liabilities still held	$ 0	$ 0	$ 0	$ 0

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Condensed Consolidating Guarantor and Non-Guarantor Financial Information - Statement of Cash Flows (Details) (USD $) In Millions, unless otherwise specified	6 Months Ended
	Apr. 30, 2015	Apr. 30, 2014
Net cash provided by (used in) operations	$ (237)	$ (326)
Net change in restricted cash and cash equivalents	53	(21)
Net sales of marketable securities	332	296
Capital expenditures and purchase of equipment leased to others	(65)	(158)
Other investing activities	12	25
Net cash provided by investing activities	332	142
Net borrowings (repayments) of debt	16	11
Net cash provided by financing activities	17	33
Effect of exchange rate changes on cash and cash equivalents	(26)	(10)
Increase (decrease) in cash and cash equivalents	86	(161)
Increase (decrease) in cash and cash equivalents	497	755
Cash and cash equivalents at beginning of the period	583	594
Other financing activities	1	22
Parent Company [Member]
Net cash provided by (used in) operations	(168)	(458)
Net change in restricted cash and cash equivalents	1	5
Net sales of marketable securities	229	389
Capital expenditures and purchase of equipment leased to others	0	0
Other investing activities	0	0
Net cash provided by investing activities	230	394
Net borrowings (repayments) of debt	0	(10)
Net cash provided by financing activities	0	8
Effect of exchange rate changes on cash and cash equivalents	0	0
Increase (decrease) in cash and cash equivalents	62	(56)
Increase (decrease) in cash and cash equivalents	101	336
Cash and cash equivalents at beginning of the period	163	280
Other financing activities	0	18
Guarantor Subsidiaries [Member]
Net cash provided by (used in) operations	41	(961)
Net change in restricted cash and cash equivalents	(2)	(1)
Net sales of marketable securities	0	0
Capital expenditures and purchase of equipment leased to others	(30)	(67)
Other investing activities	7	8
Net cash provided by investing activities	(25)	(60)
Net borrowings (repayments) of debt	(52)	959
Net cash provided by financing activities	(32)	993
Effect of exchange rate changes on cash and cash equivalents	0	0
Increase (decrease) in cash and cash equivalents	(16)	(28)
Increase (decrease) in cash and cash equivalents	53	72
Cash and cash equivalents at beginning of the period	37	44
Other financing activities	20	34
Non-Guarantor Subsidiaries [Member]
Net cash provided by (used in) operations	(188)	85
Net change in restricted cash and cash equivalents	54	(25)
Net sales of marketable securities	103	(93)
Capital expenditures and purchase of equipment leased to others	(35)	(91)
Other investing activities	5	17
Net cash provided by investing activities	127	(192)
Net borrowings (repayments) of debt	66	68
Net cash provided by financing activities	127	38
Effect of exchange rate changes on cash and cash equivalents	(26)	(8)
Increase (decrease) in cash and cash equivalents	40	(77)
Increase (decrease) in cash and cash equivalents	343	347
Cash and cash equivalents at beginning of the period	383	270
Other financing activities	61	(30)
Consolidation, Eliminations [Member]
Net cash provided by (used in) operations	78	1,008
Net change in restricted cash and cash equivalents	0	0
Net sales of marketable securities	0	0
Capital expenditures and purchase of equipment leased to others	0	0
Other investing activities	0	0
Net cash provided by investing activities	0	0
Net borrowings (repayments) of debt	2	(1,006)
Net cash provided by financing activities	(78)	(1,006)
Effect of exchange rate changes on cash and cash equivalents	0	(2)
Increase (decrease) in cash and cash equivalents	0	0
Increase (decrease) in cash and cash equivalents	0	0
Cash and cash equivalents at beginning of the period	0	0
Other financing activities	$ (80)	$ 0

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Loss Per Share Attributable to Navistar International Corporation - Basic & Diluted Loss per Share (Details) (USD $) In Millions, except Per Share data, unless otherwise specified	3 Months Ended		6 Months Ended
	Apr. 30, 2015	Apr. 30, 2014	Apr. 30, 2015	Apr. 30, 2014
Earnings Per Share [Abstract]
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount	16.0	24.0	16.0	27.3
Loss from continuing operations, net of tax	$ (64)	$ (298)	$ (106)	$ (547)
Income from discontinued operations, net of tax	0	1	0	2
Net loss attributable to Navistar International Corporation	$ (64)	$ (297)	$ (106)	$ (545)
Basic (in shares)	81.6	81.4	81.5	81.3
Weighted Average Number Diluted Shares Outstanding Adjustment	0	0	0	0
Diluted (in shares)	81.6	81.4	81.5	81.3
Basic: Loss from Continuing Operations (in dollars per share)	$ (0.78)	$ (3.66)	$ (1.30)	$ (6.73)
Basic: Income (Loss) from Discontinued Operations (in dollars per share)	$ 0.00	$ 0.01	$ 0.00	$ 0.03
Basic (in dollars per share)	$ (0.78)	$ (3.65)	$ (1.30)	$ (6.70)
Diluted: Loss from Continuing Operations (in dollars per share)	$ (0.78)	$ (3.66)	$ (1.30)	$ (6.73)
Diluted: Income (Loss) from Discontinued Operations (in dollars per share)	$ 0.00	$ 0.01	$ 0.00	$ 0.03
Diluted (in dollars per share)	$ (0.78)	$ (3.65)	$ (1.30)	$ (6.70)

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Restructuring and Impairments (Tables)

6 Months Ended

Apr. 30, 2015

Restructuring and Related Activities [Abstract]

Restructuring and Related Costs [Table Text Block]

The following table reconciles our impairment charges in our Consolidated Statements of Operations

	Three Months Ended April 30,				Six Months Ended April 30,
(in millions)	2015		2014		2015		2014
Goodwill impairment charge	$	—	$	142	$	—	$	142
Intangible asset impairment charge	—		7		—		7
Other asset impairment charges related to continuing operations	1		2		8		20
Total asset impairment charges	$	1	$	151	$	8	$	169

Schedule of Restructuring Reserve by Type of Cost [Table Text Block]

The following tables summarize the activity in the restructuring liability, which includes amounts related to discontinued operations and excludes pension and other postretirement contractual termination benefits:

(in millions)	Balance at October 31, 2014		Additions		Payments			Adjustments			Balance at April 30, 2015
Employee termination charges	$	8	$	7	$	(4	)	$	(1	)	$	10
Lease vacancy	11		—		(4		)	—			7
Other	1		—		—			—			1
Restructuring liability	$	20	$	7	$	(8	)	$	(1	)	$	18

(in millions)	Balance at October 31, 2013		Additions		Payments			Adjustments		Balance at April 30, 2014
Employee termination charges	$	15	$	9	$	(8	)	$	—	$	16
Employee relocation costs	—		1		(1		)	—		—
Lease vacancy	18		1		(4		)	—		15
Other	1		—		(2		)	—		(1		)
Restructuring liability	$	34	$	11	$	(15	)	$	—	$	30

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Inventories - Inventory (Details) (USD $) In Millions, unless otherwise specified	Apr. 30, 2015	Oct. 31, 2014
Inventory Disclosure [Abstract]
Finished products	$ 797	$ 880
Work in process	85	50
Raw materials	363	389
Total inventories	$ 1,245	$ 1,319

XML

Restructuring and Impairments - Schedule of Impairment Charges (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended		3 Months Ended
	Apr. 30, 2015	Apr. 30, 2014	Apr. 30, 2015	Apr. 30, 2014	Jan. 31, 2014
Restructuring Cost and Reserve [Line Items]
Other Asset Impairment Charges	$ 1	$ 2	$ 8	$ 20
Asset impairment charges	1	151	8	169
Brazilian Reporting Unit [Member]
Restructuring Cost and Reserve [Line Items]
Goodwill, Impairment Loss	0	142	0	142
Impairment of Intangible Assets, Indefinite-lived (Excluding Goodwill)	0	7	0	7
Asset impairment charges		149
Impairment charges [Member]
Restructuring Cost and Reserve [Line Items]
Asset impairment charges				169
North America Truck [Member]
Restructuring Cost and Reserve [Line Items]
Asset impairment charges					$ 18

XML

Condensed Consolidating Guarantor and Non-Guarantor Financial Information - Balance Sheet (Details) (USD $) In Millions, unless otherwise specified	Apr. 30, 2015	Oct. 31, 2014	Apr. 30, 2014	Oct. 31, 2013
Cash and cash equivalents	$ 583	$ 497	$ 594	$ 755
Marketable securities	273	605
Restricted cash	113	171
Finance and other receivables, net	2,674	2,616
Inventories	1,245	1,319
Investments in non-consolidated affiliates	68	73
Property and equipment, net	1,407	1,562
Goodwill	38	38
Deferred taxes, net	172	200
Other	352	362
Total assets	6,925	7,443
Debt	5,203	5,224
Postretirement benefits liabilities	2,866	2,955
Amounts due to (from) affiliates	0	0
Other liabilities	3,600	3,882
Total liabilities	11,669	12,061
Redeemable equity securities	1	2
Stockholders’ equity attributable to non-controlling interests	30	34
Stockholders’ equity (deficit) attributable to Navistar International Corporation	(4,775)	(4,654)
Total liabilities and stockholders’ deficit	6,925	7,443
Parent Company [Member]
Cash and cash equivalents	163	101
Marketable securities	150	379
Restricted cash	17	19
Finance and other receivables, net	3	0
Inventories	0	0
Investments in non-consolidated affiliates	(7,322)	(7,245)
Property and equipment, net	0	0
Goodwill	0	0
Deferred taxes, net	5	5
Other	32	34
Total assets	(6,952)	(6,707)
Debt	1,965	1,958
Postretirement benefits liabilities	0	0
Amounts due to (from) affiliates	(7,749)	(7,618)
Other liabilities	3,606	3,605
Total liabilities	(2,178)	(2,055)
Redeemable equity securities	1	2
Stockholders’ equity attributable to non-controlling interests	0	0
Stockholders’ equity (deficit) attributable to Navistar International Corporation	(4,775)	(4,654)
Total liabilities and stockholders’ deficit	(6,952)	(6,707)
Guarantor Subsidiaries [Member]
Cash and cash equivalents	37	53
Marketable securities	0	0
Restricted cash	6	4
Finance and other receivables, net	132	124
Inventories	785	792
Investments in non-consolidated affiliates	6,495	6,410
Property and equipment, net	768	827
Goodwill	0	0
Deferred taxes, net	9	9
Other	141	137
Total assets	8,373	8,356
Debt	887	937
Postretirement benefits liabilities	2,639	2,712
Amounts due to (from) affiliates	11,963	11,739
Other liabilities	249	370
Total liabilities	15,738	15,758
Redeemable equity securities	0	0
Stockholders’ equity attributable to non-controlling interests	0	0
Stockholders’ equity (deficit) attributable to Navistar International Corporation	(7,365)	(7,402)
Total liabilities and stockholders’ deficit	8,373	8,356
Non-Guarantor Subsidiaries [Member]
Cash and cash equivalents	383	343
Marketable securities	123	226
Restricted cash	90	148
Finance and other receivables, net	2,558	2,504
Inventories	475	539
Investments in non-consolidated affiliates	65	71
Property and equipment, net	646	740
Goodwill	38	38
Deferred taxes, net	158	185
Other	179	194
Total assets	4,715	4,988
Debt	2,357	2,336
Postretirement benefits liabilities	227	243
Amounts due to (from) affiliates	(4,352)	(4,267)
Other liabilities	(182)	(22)
Total liabilities	(1,950)	(1,710)
Redeemable equity securities	0	0
Stockholders’ equity attributable to non-controlling interests	30	34
Stockholders’ equity (deficit) attributable to Navistar International Corporation	6,635	6,664
Total liabilities and stockholders’ deficit	4,715	4,988
Consolidation, Eliminations [Member]
Cash and cash equivalents	0	0
Marketable securities	0	0
Restricted cash	0	0
Finance and other receivables, net	(19)	(12)
Inventories	(15)	(12)
Investments in non-consolidated affiliates	830	837
Property and equipment, net	(7)	(5)
Goodwill	0	0
Deferred taxes, net	0	1
Other	0	(3)
Total assets	789	806
Debt	(6)	(7)
Postretirement benefits liabilities	0	0
Amounts due to (from) affiliates	138	146
Other liabilities	(73)	(71)
Total liabilities	59	68
Redeemable equity securities	0	0
Stockholders’ equity attributable to non-controlling interests	0	0
Stockholders’ equity (deficit) attributable to Navistar International Corporation	730	738
Total liabilities and stockholders’ deficit	$ 789	$ 806

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Summary of Significant Accounting Policies - Narrative (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended		3 Months Ended
	Apr. 30, 2015	Apr. 30, 2014	Apr. 30, 2015 segments	Apr. 30, 2014	Jan. 31, 2015	Jan. 31, 2014	Oct. 31, 2014
Accounting Policies [Line Items]
Net loss attributable to Navistar International Corporation	$ (64)	$ (297)	$ (106)	$ (545)
Number Of Segments			4
Sales of manufactured products, net	2,658	2,708	5,043	4,877
Interest expense	75	74	152	156
Capital expenditures	28	29	45	50
Proceeds from financed lease obligations			20	34
Product Warranty Accrual, Preexisting, Increase (Decrease)			(39)	94
Unionized Employees Concentration Risk [Member] | Number Of Employees Hourly Workers [Member]
Accounting Policies [Line Items]
Concentration Risk Number Of Employees	6,200		6,200
concentration risk number of employees percentage	73.00%		73.00%
Unionized Employees Concentration Risk [Member] | Number of Employees Salaried Workers [Member]
Accounting Policies [Line Items]
Concentration Risk Number Of Employees	300		300
concentration risk number of employees percentage	5.00%		5.00%
Brazilian Reporting Unit [Member]
Accounting Policies [Line Items]
Impairment of Intangible Assets, Indefinite-lived (Excluding Goodwill)	0	7	0	7
Indefinite-Lived Intangible Assets (Excluding Goodwill)		43		43
Goodwill, Impairment Loss	0	142	0	142
Product Warranty Accrual [Member]
Accounting Policies [Line Items]
Product Warranty Accrual, Preexisting, Increase (Decrease)		42			(57)	52
North America Truck [Member]
Accounting Policies [Line Items]
Interest expense	0	0	0	0
Capital expenditures	24	26	38	38
Extended Warranty Programs [Member]
Accounting Policies [Line Items]
Deferred Revenue, Revenue Recognized	38	33	75	60
Deferred Revenue	$ 425		$ 425				$ 437

XML

Debt - Narrative (Details) (USD $)	3 Months Ended			6 Months Ended		12 Months Ended			1 Months Ended
	Apr. 30, 2015	Jan. 31, 2015	Apr. 30, 2014	Apr. 30, 2015	Apr. 30, 2014	Oct. 31, 2014	Oct. 31, 2013	Oct. 31, 2012	Oct. 31, 2009
Debt Instrument [Line Items]
Payments to subsidiary to meet convenant requirement						$ 0	$ 0	$ 0
Warrants and Rights Outstanding	2,875,175			2,875,175
Charge Related to Repurchase of Debt			11,000,000
Shares of Call Options Unwound			8,026,456
Shares of Warrants Unwound	1,939,376		6,523,319
Payments of Debt Issuance Costs				7,000,000	13,000,000
Cash Dividends Paid to Parent Company by Consolidated Subsidiaries		125,000,000
Proceeds from issuance of securitized debt				250,000,000	152,000,000
Three Point Zero Percent Senior Subordinated Convertible Notes [Member]
Debt Instrument [Line Items]
Shares of Warrants Unwound	1,939,376		6,523,319
Four Point Seven Five Senior Subordinated Convertible Notes [Member] [Member]
Debt Instrument [Line Items]
Option Indexed to Issuer's Equity, Strike Price				$ 54.07
Debt Instrument, Convertible, Conversion Ratio				18.4946
Financial Services Operations [Member] | VFN Facility [Member]
Debt Instrument [Line Items]
Debt Instrument, Face Amount		500,000,000
Financial Services Operations [Member] | Notes Payable, Other Payables [Member] | Investor Notes Maturing Two Thousand and Fifteen [Member]
Debt Instrument [Line Items]
Debt Instrument, Face Amount		250,000,000
Financial Services Operations [Member] | Notes Payable, Other Payables [Member] | Investor Notes Maturing October Two Thousand Thirteen [Member]
Debt Instrument [Line Items]
Debt Instrument, Face Amount		200,000,000
Manufacturing Operations [Member] | Convertible Subordinated Debt [Member] | Three Point Zero Percent Senior Subordinated Convertible Notes [Member]
Debt Instrument [Line Items]
Repayments of Long-term Debt			404,000,000
Debt Instrument, Face Amount									570,000,000
Class of Warrant or Right, Exercise Price of Warrants or Rights									$ 60.14
Proceeds from Issuance of Warrants									87,000,000
Manufacturing Operations [Member] | Convertible Subordinated Debt [Member] | Four Point Five Zero Senior Subordinated Convertible Notes [Member]
Debt Instrument [Line Items]
Debt Instrument, Interest Rate, Stated Percentage	4.50%			4.50%
Manufacturing Operations [Member] | Convertible Subordinated Debt [Member] | Four Point Seven Five Senior Subordinated Convertible Notes [Member] [Member]
Debt Instrument [Line Items]
Debt Instrument, Interest Rate, Stated Percentage	4.75%			4.75%
Debt Instrument, Face Amount			411,000,000		411,000,000
Manufacturing Operations [Member] | Tax Exempt Bond [Member]
Debt Instrument [Line Items]
Debt Instrument, Interest Rate, Stated Percentage	6.50%			6.50%
Call Option [Member] | Manufacturing Operations [Member] | Convertible Subordinated Debt [Member] | Three Point Zero Percent Senior Subordinated Convertible Notes [Member]
Debt Instrument [Line Items]
Payments for Derivative Instrument, Investing Activities									125,000,000
Option Indexed to Issuer's Equity, Indexed Shares									11,337,870
Option Indexed to Issuer's Equity, Strike Price									$ 50.27
Convertible Debt Securities [Member] | Three Point Zero Percent Senior Subordinated Convertible Notes [Member]
Debt Instrument [Line Items]
Option Indexed to Issuer's Equity, Strike Price									$ 50.27
Debt Instrument, Convertible, Conversion Ratio				19.891
Convertible Debt Securities [Member] | Four Point Five Zero Senior Subordinated Convertible Notes [Member]
Debt Instrument [Line Items]
Debt Instrument, Convertible, Conversion Ratio				17.1233
Mexican Pesos
Debt Instrument [Line Items]
Long-term Debt		1,800,000,000
United States of America, Dollars
Debt Instrument [Line Items]
Long-term Debt	$ 118,000,000			$ 118,000,000

XML

Segment Reporting - Summary of Segment Operations (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended			6 Months Ended
	Apr. 30, 2015	Jan. 31, 2015	Apr. 30, 2014	Apr. 30, 2015	Apr. 30, 2014
Segment Reporting Information [Line Items]
External sales and revenues, net	$ 2,693		$ 2,746	$ 5,114	$ 4,954
Sales and revenues, net	2,693		2,746	5,114	4,954
Loss from continuing operations, net of tax	(64)		(298)	(106)	(547)
Income tax expense	(18)		(23)	(25)	(11)
Interest expense	75		74	152	156
Equity in income of non-consolidated affiliates	1		3	3	3
Capital expenditures	28		29	45	50
Intersegment sales and revenues	0	35	0	0	0
Segment Profit Loss	(46)		(275)	(81)	(536)
Depreciation, Depletion and Amortization	74		99	153	185
North America Truck [Member]
Segment Reporting Information [Line Items]
External sales and revenues, net	1,933		1,829	3,564	3,220
Sales and revenues, net	1,966		1,889	3,636	3,340
Loss from continuing operations, net of tax	(51)		(129)	(69)	(337)
Income tax expense	0		0	0	0
Interest expense	0		0	0	0
Equity in income of non-consolidated affiliates	1		1	3	2
Capital expenditures	24		26	38	38
Intersegment sales and revenues	33		60	72	120
Segment Profit Loss	(51)		(129)	(69)	(337)
Depreciation, Depletion and Amortization	47		71	99	129
North America Parts [Member]
Segment Reporting Information [Line Items]
External sales and revenues, net	607		614	1,221	1,188
Sales and revenues, net	613		630	1,239	1,216
Loss from continuing operations, net of tax	133		133	278	241
Income tax expense	0		0	0	0
Interest expense	0		0	0	0
Equity in income of non-consolidated affiliates	1		1	2	2
Capital expenditures	0		1	0	5
Intersegment sales and revenues	6		16	18	28
Segment Profit Loss	133		133	278	241
Depreciation, Depletion and Amortization	4		4	7	8
Global Operations [Member]
Segment Reporting Information [Line Items]
External sales and revenues, net	115		265	253	469
Sales and revenues, net	130		271	282	483
Loss from continuing operations, net of tax	1		(162)	(14)	(197)
Income tax expense	0		0	0	0
Interest expense	0		0	0	0
Equity in income of non-consolidated affiliates	(1)		1	(2)	(1)
Capital expenditures	1		1	3	4
Intersegment sales and revenues	15		6	29	14
Segment Profit Loss	1		(162)	(14)	(197)
Depreciation, Depletion and Amortization	5		6	12	14
Financial Services Operations [Member]
Segment Reporting Information [Line Items]
External sales and revenues, net	35		38	71	77
Sales and revenues, net	60		57	120	112
Loss from continuing operations, net of tax	22		24	46	47
Income tax expense	0		0	0	0
Interest expense	18		17	38	34
Equity in income of non-consolidated affiliates	0		0	0	0
Capital expenditures	2		0	2	1
Investment Income, Interest	44		42	89	82
Intersegment sales and revenues	25		19	49	35
Segment Profit Loss	22		24	46	47
Depreciation, Depletion and Amortization	12		11	24	21
Corporate And Eliminations [Member]
Segment Reporting Information [Line Items]
External sales and revenues, net	3		0	5	0
Sales and revenues, net	(76)		(101)	(163)	(197)
Loss from continuing operations, net of tax	(169)		(164)	(347)	(301)
Income tax expense	(18)		(23)	(25)	(11)
Interest expense	57		57	114	122
Equity in income of non-consolidated affiliates	0		0	0	0
Capital expenditures	1		1	2	2
Intersegment sales and revenues	(79)		(101)	(168)	(197)
Segment Profit Loss	(151)		(141)	(322)	(290)
Depreciation, Depletion and Amortization	$ 6		$ 7	$ 11	$ 13

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Financial Instruments and Commodity Contracts - Narrative (Details) (USD $)	Apr. 30, 2015	Oct. 31, 2014	Apr. 30, 2014
Derivative [Line Items]
Derivative, Amount of Hedged Item	$ 0		$ 0
Derivative, Collateral, Obligation to Return Cash	1,000,000	0
Exposure to Credit Risk	1,000,000
Interest Rate Contract [Member]
Derivative [Line Items]
Derivative, Notional Amount	0	27,000,000
Diesel Fuel Forward Contracts [Member] | Commodity Contract [Member]
Derivative [Line Items]
Derivative, Notional Amount	17,000,000	24,000,000
Steel Forward Contracts [Member] | Commodity Contract [Member]
Derivative [Line Items]
Derivative, Notional Amount	11,000,000	23,000,000
Mexican Financial Services [Member] | Asset-backed Securities [Member]
Derivative [Line Items]
Derivative, Notional Amount	118,000,000
Mexican Financial Services [Member] | Interest Rate Cap [Member]
Derivative [Line Items]
Derivative, Notional Amount		$ 134,000,000

XML

Allowance for Doubtful Accounts - Schedule of Impaired Finance Receivables (Details) (USD $) In Millions, unless otherwise specified	Apr. 30, 2015	Oct. 31, 2014
Impaired finance receivables with specific loss reserves [Member]
Finance Receivable, Impaired [Line Items]
Impaired Financing Receivable, Recorded Investment	$ 20	$ 20
Impaired finance receivables with specific loss reserves [Member] | Retail Portfolio [Member]
Finance Receivable, Impaired [Line Items]
Impaired Financing Receivable, Recorded Investment	20	20
Impaired finance receivables with specific loss reserves [Member] | Wholesale Portfolio [Member]
Finance Receivable, Impaired [Line Items]
Impaired Financing Receivable, Recorded Investment	0	0
Impaired financing receivable without specific loss reserves [Member]
Finance Receivable, Impaired [Line Items]
Impaired Financing Receivable, Recorded Investment	7	1
Impaired financing receivable without specific loss reserves [Member] | Retail Portfolio [Member]
Finance Receivable, Impaired [Line Items]
Impaired Financing Receivable, Recorded Investment	7	1
Impaired financing receivable without specific loss reserves [Member] | Wholesale Portfolio [Member]
Finance Receivable, Impaired [Line Items]
Impaired Financing Receivable, Recorded Investment	0	0
Specific loss reserves on impaired finance receivables [Member]
Finance Receivable, Impaired [Line Items]
Specific loss reserves on impaired finance receivables	9	6
Specific loss reserves on impaired finance receivables [Member] | Retail Portfolio [Member]
Finance Receivable, Impaired [Line Items]
Specific loss reserves on impaired finance receivables	9	6
Specific loss reserves on impaired finance receivables [Member] | Wholesale Portfolio [Member]
Finance Receivable, Impaired [Line Items]
Specific loss reserves on impaired finance receivables	0	0
Finance receivable non-accrual status [Member]
Finance Receivable, Impaired [Line Items]
Finance receivables on non-accrual status	27	21
Finance receivable non-accrual status [Member] | Retail Portfolio [Member]
Finance Receivable, Impaired [Line Items]
Finance receivables on non-accrual status	27	21
Finance receivable non-accrual status [Member] | Wholesale Portfolio [Member]
Finance Receivable, Impaired [Line Items]
Finance receivables on non-accrual status	$ 0	$ 0

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Summary of Significant Accounting Policies

6 Months Ended

Apr. 30, 2015

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

Summary of Significant Accounting Policies

Organization and Description of the Business

Navistar International Corporation ("NIC"), incorporated under the laws of the State of Delaware in 1993, is a holding company whose principal operating entities are Navistar, Inc. and Navistar Financial Corporation ("NFC"). References herein to the "Company," "we," "our," or "us" refer collectively to NIC and its consolidated subsidiaries, including certain variable interest entities ("VIEs") of which we are the primary beneficiary. We operate in four principal industry segments: Truck, Parts, Global Operations (collectively called "Manufacturing operations"), and Financial Services, which consists of NFC and our foreign finance operations (collectively called "Financial Services operations"). These segments are discussed in Note 12, Segment Reporting.

Our fiscal year ends on October 31. As such, all references to 2015 and 2014 contained within this Quarterly Report on Form 10-Q relate to the fiscal year, unless otherwise indicated.

Basis of Presentation and Consolidation

The accompanying unaudited consolidated financial statements include the assets, liabilities, and results of operations of our Manufacturing operations, which include majority-owned dealers ("Dealcors"), and our Financial Services operations, including VIEs of which we are the primary beneficiary. The effects of transactions among consolidated entities have been eliminated to arrive at the consolidated amounts.

Certain reclassifications were made to prior period amounts to conform to the 2015 presentation, which relate to the realignment of our reporting segments that became effective during the first quarter of 2015. For more information, see Note 12, Segment Reporting.

We prepared the accompanying unaudited consolidated financial statements in accordance with United States ("U.S.") generally accepted accounting principles ("U.S. GAAP") for interim financial information and the instructions to the Quarterly Report on Form 10-Q and Article 10 of Regulation S-X issued by the U.S. Securities and Exchange Commission ("SEC"). Accordingly, they do not include all of the information and notes required by U.S. GAAP for comprehensive annual financial statements.

The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting policies described in our Annual Report on Form 10-K for the year ended October 31, 2014, which should be read in conjunction with the disclosures therein. In our opinion, these interim consolidated financial statements reflect all adjustments, consisting of normal recurring adjustments, necessary to present fairly the financial condition, results of operations, and cash flows for the periods presented. Operating results for interim periods are not necessarily indicative of annual operating results.

Variable Interest Entities

We have an interest in several VIEs, primarily joint ventures, established to manufacture or distribute products and enhance our operational capabilities. We have determined for certain of our VIEs that we are the primary beneficiary because we have the power to direct the activities of the VIE that most significantly impact its economic performance and we have the obligation to absorb losses of, or the right to receive benefits from, the VIE that could potentially be significant to the VIE. Accordingly, we include in our consolidated financial statements the assets and liabilities and results of operations of those entities, even though we may not own a majority voting interest. The liabilities recognized as a result of consolidating these VIEs do not represent additional claims on our general assets; rather they represent claims against the specific assets of these VIEs. Assets of these entities are not readily available to satisfy claims against our general assets.

We are the primary beneficiary of our Blue Diamond Parts ("BDP") and Blue Diamond Truck ("BDT") joint ventures with Ford. As a result, our Consolidated Balance Sheets include assets of $263 million and $297 million and liabilities of $238 million and $250 million as of April 30, 2015 and October 31, 2014, respectively, from BDP and BDT, including $87 million and $77 million of cash and cash equivalents, at the respective dates, which are not readily available to satisfy claims against our general assets. The creditors of BDP and BDT do not have recourse to our general credit. On May 29, 2015, we acquired Ford's remaining 25% ownership in BDT. The termination of the BDT joint venture did not have a material impact on our consolidated financial statements.

Our Financial Services segment consolidates several VIEs. As a result, our Consolidated Balance Sheets include secured assets of $1.2 billion and $1.1 billion as of April 30, 2015 and October 31, 2014, respectively, and liabilities of $923 million and $896 million as of April 30, 2015 and October 31, 2014, respectively, all of which are involved in securitizations that are treated as asset-backed debt. In addition, our Consolidated Balance Sheets include secured assets of $213 million and $156 million and

corresponding liabilities of $92 million and $54 million as of April 30, 2015 and October 31, 2014, respectively, which are related to other secured transactions that do not qualify for sale accounting treatment, and therefore, are treated as borrowings secured by operating and finance leases. Investors that hold securitization debt have a priority claim on the cash flows generated by their respective securitized assets to the extent that the related VIEs are required to make principal and interest payments. Investors in securitizations of these entities have no recourse to our general credit.

We also have an interest in other VIEs, which we do not consolidate because we are not the primary beneficiary. Our financial support and maximum loss exposure relating to these non-consolidated VIEs are not material to our financial condition, results of operations, or cash flows.

We use the equity method to account for our investments in entities that we do not control under the voting interest or variable interest models, but where we have the ability to exercise significant influence over operating and financial policies. Equity in income of non-consolidated affiliates includes our share of the net income of these entities.

Product Warranty Liability

The following table presents accrued product warranty and deferred warranty revenue activity:

	Six Months Ended April 30,
(in millions)	2015			2014
Balance at beginning of period	$	1,197		$	1,349
Costs accrued and revenues deferred	116			153
Currency translation adjustment	(5		)	(1		)
Adjustments to pre-existing warranties(A)	(39		)	94
Payments and revenues recognized	(210		)	(272		)
Balance at end of period	1,059			1,323
Less: Current portion	496			626
Noncurrent accrued product warranty and deferred warranty revenue	$	563		$	697

_________________________

(A) Adjustments to pre-existing warranties reflect changes in our estimate of warranty costs for products sold in prior periods. Such adjustments typically occur when claims experience deviates from historic and expected trends. Our warranty liability is generally affected by component failure rates, repair costs, and the timing of failures. Future events and circumstances related to these factors could materially change our estimates and require adjustments to our liability. In addition, new product launches require a greater use of judgment in developing estimates until historical experience becomes available.

In the first quarter of 2015, we recognized a benefit for adjustments to pre-existing warranties of $57 million or a benefit of $0.70 per diluted share. Inthe first quarter of 2014, we recorded adjustments for changes in estimates of $52 million or charges of $0.64 per diluted share. In the second quarter of 2014, we recorded adjustments for changes in estimates of $42 million, or charges of $0.52 per diluted share. The impact of income taxes on the 2015 and 2014 adjustments are not material due to our deferred tax valuation allowances on our U.S. deferred tax assets.

Extended Warranty Programs

The amount of deferred revenue related to extended warranty programs was $425 million and $437 million at April 30, 2015 and October 31, 2014, respectively. Revenue recognized under our extended warranty programs was $38 million and $75 million, in the three and six months ended April 30, 2015, respectively, and $33 million and $60 million for the three and six months ended April 30, 2014, respectively.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses for the periods presented. Significant estimates and assumptions are used for, but are not limited to, pension and other postretirement benefits, allowance for doubtful accounts, income tax contingency accruals and valuation allowances, product warranty accruals, asbestos and other product liability accruals, asset impairment charges, and litigation-related accruals. Actual results could differ from our estimates.

Concentration Risks

Our financial condition, results of operations, and cash flows are subject to concentration risks related to concentrations of our union employees. As of April 30, 2015, approximately 6,200, or 73%, of our hourly workers and approximately 300, or 5%, of our salaried workers are represented by labor unions and are covered by collective bargaining agreements. On February 9, 2015, our United Automobile, Aerospace, and Agricultural Implement Workers of America ("UAW") represented employees ratified a new four-year labor agreement that replaced the prior contract that expired October 1, 2014. Our future operations may be affected by changes in governmental procurement policies, budget considerations, changing national defense requirements, and global, political, regulatory and economic developments in the U.S. and certain foreign countries (primarily Canada, Mexico, and Brazil).

Goodwill and Indefinite-Lived Intangible Assets

Goodwill represents the excess of the cost of an acquired business over the amounts assigned to the net assets. Goodwill is not amortized but is tested for impairment at a reporting unit level on an annual basis or more frequently, if circumstances change or an event occurs that would more likely than not reduce the fair value of a reporting unit below its carrying amount. Qualitative factors may be assessed to determine whether it is more likely than not that the fair value of the reporting unit is less than its carrying amount. If the qualitative assessment indicates that the carrying amount is more likely than not higher than the fair value, goodwill is tested for impairment based on a two-step test. The first step compares the fair value of a reporting unit with its carrying amount, including goodwill. If the fair value of a reporting unit exceeds its carrying amount, goodwill of the reporting unit is considered not impaired, thus the second step of the impairment test is unnecessary. If the carrying amount of a reporting unit exceeds its fair value, the second step of the goodwill impairment test shall be performed to measure the amount of impairment loss, if any. The second step compares the implied fair value of reporting unit goodwill with the carrying amount of that goodwill. If the carrying amount of reporting unit goodwill exceeds the implied fair value of that goodwill, an impairment loss shall be recognized in an amount equal to that excess.

Significant judgment is applied when goodwill is assessed for impairment. This judgment includes developing cash flow projections, selecting appropriate discount rates, identifying relevant market comparables, incorporating general economic and market conditions, and selecting an appropriate control premium. The income approach is based on discounted cash flows which are derived from internal forecasts and economic expectations for each respective reporting unit.

An intangible asset determined to have an indefinite useful life is not amortized until its useful life is determined to no longer be indefinite. Indefinite-lived intangible assets are evaluated each reporting period to determine whether events and circumstances continue to support an indefinite useful life. Indefinite-lived intangible assets are tested for impairment annually or more frequently if events or changes in circumstances indicate that the asset might be impaired. The impairment test consists of a comparison of the fair value of the indefinite-lived intangible asset with its carrying amount. If the carrying amount of an indefinite-lived intangible asset exceeds its fair value, an impairment loss is recognized in an amount equal to that excess.

Significant judgment is applied when evaluating if an intangible asset has a finite useful life. In addition, for indefinite-lived intangible assets, significant judgment is applied in testing for impairment. This judgment includes developing cash flow projections, selecting appropriate discount rates, identifying relevant market comparables, and incorporating general economic and market conditions. 

During the second quarter of 2014, the economic downturn in Brazil resulted in the continued decline in actual and forecasted results for the Brazilian engine reporting unit with goodwill of $142 million and an indefinite-lived intangible asset, trademark, of $43 million. As a result, we performed an impairment analysis in the second quarter of 2014 utilizing the income approach, based on discounted cash flows, which are derived from internal forecasts and economic expectations. It was determined that the carrying value of the Brazilian engine reporting unit, including goodwill, exceeded its fair value. As a result we compared the implied fair value of the reporting unit's goodwill with the carrying amount of that goodwill. A decrease in the enterprise value of the reporting unit coupled with appreciation in the value of certain tangible assets, which are not recognized for accounting purposes, resulted in the determination that the entire $142 million of goodwill was impaired. In addition, we determined that the related trademark was impaired and recognized an impairment charge of $7 million. The non-cash impairment charges were included in Asset impairment charges in the Company's Consolidated Statements of Operations. The Brazilian engine reporting unit is included in the Global Operations segment.

Recently Adopted Accounting Standards

In the six months ended April 30, 2015, the Company has not adopted any new accounting guidance that has had a material impact on our consolidated financial statements.

Recently Issued Accounting Standards

In May 2014, the Financial Accounting Standards Board ("FASB") issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606), which supersedes the revenue recognition requirements in ASC 605, Revenue Recognition. This ASU is based on the principle that revenue is recognized to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The ASU also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract. This new guidance is effective for annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period. Early adoption is not permitted. Our effective date is November 1, 2017. On April 29, 2015 the FASB issued an exposure draft of a proposed ASU that would delay by one year the effective date of ASU 2014-09 and allow early adoption as of the original effective date. The changes to the effective date and early adoption are still subject to final approval. We are currently evaluating the impact and method of adoption of this ASU on our consolidated financial statements.

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Financial Instruments and Commodity Contracts - Derivative Financial Instruments (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended
	Apr. 30, 2015	Apr. 30, 2014	Apr. 30, 2015	Apr. 30, 2014
Derivative [Line Items]
Derivative Instruments,Derivative, Gain (Loss) on Derivative, Net	$ (4)	$ 2	$ 9	$ 2
Interest Rate Cap [Member] | Interest Expense [Member]
Derivative [Line Items]
Derivative Instruments,Derivative, Gain (Loss) on Derivative, Net	0	(2)	0	(1)
Cross currency swaps | Other Income Expense Net [Member]
Derivative [Line Items]
Derivative Instruments,Derivative, Gain (Loss) on Derivative, Net	1	(1)	3	1
Foreign Exchange Contract [Member] | Other Income Expense Net [Member]
Derivative [Line Items]
Derivative Instruments,Derivative, Gain (Loss) on Derivative, Net	0	1	1	0
Commodity Contract [Member] | Cost of Sales [Member]
Derivative [Line Items]
Derivative Instruments,Derivative, Gain (Loss) on Derivative, Net	$ 5	$ 0	$ (5)	$ 0

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Finance Receivables - Narrative (Details) (USD $)	Apr. 30, 2015 segments	Jan. 31, 2015 segments	Oct. 31, 2014
Schedule of Securitization [Line Items]
Loans and Leases Receivable, Net Amount	$ 2,200,000,000		$ 2,000,000,000
Number of Portfolio Segments for Finance Receivables	2	2
Trac Funding Facility [Member]
Schedule of Securitization [Line Items]
Finance Receivables Retail Accounts Collateral For Borrowed Securities	1,100,000,000		996,000,000
Cash Collateral for Borrowed Securities	149,000,000		93,000,000
Financial Services Operations [Member]
Schedule of Securitization [Line Items]
Assets Net Of Intercompany Balances	$ 2,600,000,000		$ 2,600,000,000

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Debt (Tables)

6 Months Ended

Apr. 30, 2015

Debt Disclosure [Abstract]

Debt

(in millions)	April 30, 2015		October 31, 2014
Manufacturing operations
Senior Secured Term Loan Credit Facility, as amended, due 2017, net of unamortized discount of $3, at both dates	$	694	$	694
8.25% Senior Notes, due 2021, net of unamortized discount of $19 and $20, respectively	1,181		1,180
4.50% Senior Subordinated Convertible Notes, due 2018, net of unamortized discount of $17 and $19, respectively	183		181
4.75% Senior Subordinated Convertible Notes, due 2019, net of unamortized discount of $36 and $40, respectively	375		371
Debt of majority-owned dealerships	28		30
Financing arrangements and capital lease obligations	50		54
Loan Agreement related to 6.5% Tax Exempt Bonds, due 2040	225		225
Promissory Note	5		10
Financed lease obligations	141		184
Other	24		29
Total Manufacturing operations debt	2,906		2,958
Less: Current portion	115		100
Net long-term Manufacturing operations debt	$	2,791	$	2,858

(in millions)	April 30, 2015		October 31, 2014
Financial Services operations
Asset-backed debt issued by consolidated SPEs, at fixed and variable rates, due serially through 2018	$	986	$	914
Bank revolvers, at fixed and variable rates, due dates from 2015 through 2020	1,205		1,242
Commercial paper, at variable rates, program matures in 2017	77		74
Borrowings secured by operating and finance leases, at various rates, due serially through 2018	29		36
Total Financial Services operations debt	2,297		2,266
Less: Current portion	1,096		1,195
Net long-term Financial Services operations debt	$	1,201	$	1,071

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Inventories (Tables)

6 Months Ended

Apr. 30, 2015

Inventory Disclosure [Abstract]

Schedule of inventories

The following table presents the components of Inventories:

(in millions)	April 30, 2015		October 31, 2014
Finished products	$	797	$	880
Work in process	85		50
Raw materials	363		389
Total inventories	$	1,245	$	1,319

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Fair Value Measurements - Financial Instruments Measured on Recurring Basis (Details) (Fair Value, Measurements, Recurring [Member], USD $) In Millions, unless otherwise specified	Apr. 30, 2015	Oct. 31, 2014
Fair Value, Inputs, Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, Fair Value Disclosure	$ 273	$ 605
Guarantees, Fair Value Disclosure	0	0
Liabilities, Fair Value Disclosure	0	0
Fair Value, Inputs, Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, Fair Value Disclosure	1	1
Guarantees, Fair Value Disclosure	0	0
Liabilities, Fair Value Disclosure	6	2
Fair Value, Inputs, Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, Fair Value Disclosure	0	0
Guarantees, Fair Value Disclosure	7	8
Liabilities, Fair Value Disclosure	7	8
US Treasury Bill Securities [Member] | Fair Value, Inputs, Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	170	256
US Treasury Bill Securities [Member] | Fair Value, Inputs, Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	0	0
US Treasury Bill Securities [Member] | Fair Value, Inputs, Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	0	0
Other Investment Companies [Member] | Fair Value, Inputs, Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	103	349
Other Investment Companies [Member] | Fair Value, Inputs, Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	0	0
Other Investment Companies [Member] | Fair Value, Inputs, Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	0	0
Other Current Assets [Member] | Foreign Exchange Contract [Member] | Fair Value, Inputs, Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative Liability, Fair Value, Gross Asset	0	0
Other Current Assets [Member] | Foreign Exchange Contract [Member] | Fair Value, Inputs, Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative Liability, Fair Value, Gross Asset		0
Other Current Assets [Member] | Foreign Exchange Contract [Member] | Fair Value, Inputs, Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative Liability, Fair Value, Gross Asset	0	0
Other Noncurrent Assets [Member] | Interest Rate Cap [Member] | Fair Value, Inputs, Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Foreign currency contracts	0	0
Other Noncurrent Assets [Member] | Interest Rate Cap [Member] | Fair Value, Inputs, Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Foreign currency contracts	1	1
Other Noncurrent Assets [Member] | Interest Rate Cap [Member] | Fair Value, Inputs, Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Foreign currency contracts	0	0
Other Current Liabilities [Member] | Foreign Exchange Contract [Member] | Fair Value, Inputs, Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative Liability, Fair Value, Gross Asset	1
Other Current Liabilities [Member] | Commodity Contract [Member] | Fair Value, Inputs, Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative Liability, Fair Value, Gross Liability	0	0
Other Current Liabilities [Member] | Commodity Contract [Member] | Fair Value, Inputs, Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative Liability, Fair Value, Gross Liability	5	2
Other Current Liabilities [Member] | Commodity Contract [Member] | Fair Value, Inputs, Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative Liability, Fair Value, Gross Liability	0	0
Estimate of Fair Value Measurement [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, Fair Value Disclosure	274	606
Guarantees, Fair Value Disclosure	7	8
Liabilities, Fair Value Disclosure	13	10
Estimate of Fair Value Measurement [Member] | US Treasury Bill Securities [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	170	256
Estimate of Fair Value Measurement [Member] | Other Investment Companies [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale Securities, Fair Value Disclosure	103	349
Estimate of Fair Value Measurement [Member] | Other Current Assets [Member] | Foreign Exchange Contract [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative Liability, Fair Value, Gross Asset	1	0
Estimate of Fair Value Measurement [Member] | Other Noncurrent Assets [Member] | Interest Rate Cap [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Foreign currency contracts	1	1
Estimate of Fair Value Measurement [Member] | Other Current Liabilities [Member] | Commodity Contract [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative Liability, Fair Value, Gross Liability	$ 5	$ 2

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Finance Receivables - Finance Receivables (Details) (USD $) In Millions, unless otherwise specified	Apr. 30, 2015		Oct. 31, 2014
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount, Covered	$ 2,182		$ 2,065
Less: Allowance for Doubtful accounts	28		27
Total finance receivables, net	2,154		2,038
Financing Receivable, Recorded Investment, Current	1,929	[1]	1,758	[1]
Finance Receivables, Noncurrent	225		280
Retail Portfolio [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount, Covered	667		726
Wholesale Portfolio [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount, Covered	$ 1,515		$ 1,339

[1] The current portion of finance receivables is computed based on contractual maturities. Actual cash collections typically vary from the contractual cash flows because of prepayments, extensions, delinquencies, credit losses, and renewals.

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Postretirement Benefits (Tables)

6 Months Ended

Apr. 30, 2015

Compensation and Retirement Disclosure [Abstract]

Schedule of Net Benefit Costs [Table Text Block]

	Three Months Ended April 30,												Six Months Ended April 30,
	Pension Benefits						Health and Life Insurance Benefits						Pension Benefits						Health and Life Insurance Benefits
(in millions)	2015			2014			2015			2014			2015			2014			2015			2014
Service cost for benefits earned during the period	$	3		$	2		$	2		$	1		$	6		$	6		$	3		$	2
Interest on obligation	35			40			18			17			71			79			36			34
Amortization of cumulative loss	24			23			9			4			49			47			19			8
Amortization of prior service benefit	—			—			(1		)	(1		)	—			—			(2		)	(2		)
Contractual termination benefits	(1		)	—			(1		)	—			(1		)	—			(1		)	—
Premiums on pension insurance	4			—			—			—			5			—			—			—
Expected return on assets	(48		)	(48		)	(8		)	(8		)	(97		)	(96		)	(15		)	(16		)
Net postretirement benefits expense	$	17		$	17		$	19		$	13		$	33		$	36		$	40		$	26

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Fair Value Measurements (Tables)

6 Months Ended

Apr. 30, 2015

Fair Value Disclosures [Abstract]

Financial instruments measured at fair value, recurring basis

The following table presents the financial instruments measured at fair value on a recurring basis:

	April 30, 2015								October 31, 2014
(in millions)	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
Assets
Marketable securities:
U.S. Treasury bills	$	170	$	—	$	—	$	170	$	256	$	—	$	—	$	256
Other	103		—		—		103		349		—		—		349
Derivative financial instruments:
Interest rate caps(A)	—		1		—		1		—		1		—		1
Total assets	$	273	$	1	$	—	$	274	$	605	$	1	$	—	$	606
Liabilities
Derivative financial instruments:
Commodity forward contracts(B)	$	—	$	5	$	—	$	5	$	—	$	2	$	—	$	2
Foreign currency contracts(C)	—		1		—		1		—		—		—		—
Guarantees	—		—		7		7		—		—		8		8
Total liabilities	$	—	$	6	$	7	$	13	$	—	$	2	$	8	$	10

Financial instruments classified within Level 3

The following table presents the changes for those financial instruments classified within Level 3 of the valuation hierarchy:

	Three Months Ended April 30,
(in millions)	2015			2014
Guarantees, at February 1	$	(8	)	$	(6	)
Transfers out of Level 3	—			—
Issuances	—			—
Settlements	1			—
Guarantees, at April 30	$	(7	)	$	(6	)
Change in unrealized gains on assets and liabilities still held	$	—		$	—

	Six Months Ended April 30,
(in millions)	2015			2014
Guarantees, at November 1	$	(8	)	$	(6	)
Transfers out of Level 3	—			—
Issuances	—			—
Settlements	1			—
Guarantees, at April 30	$	(7	)	$	(6	)
Change in unrealized gains on assets and liabilities still held	$	—		$	—

Financial instruments measured at fair value, nonrecurring basis

The following table presents the financial instruments measured at fair value on a nonrecurring basis:

(in millions)	April 30, 2015			October 31, 2014
Level 2 financial instruments
Carrying value of impaired finance receivables (A)	$	20		$	20
Specific loss reserve	(9		)	(6		)
Fair value	$	11		$	14

_________________________

(A) Certain impaired finance receivables are measured at fair value on a nonrecurring basis. An impairment charge is recorded for the amount by which the carrying value of the receivables exceeds the fair value of the underlying collateral, net of remarketing costs. Fair values of the underlying collateral are determined by reference to dealer vehicle value publications adjusted for certain market factors.

Carrying values and estimated fair values of financial instruments

The following tables present the carrying values and estimated fair values of financial instruments:

	As of April 30, 2015
	Estimated Fair Value								Carrying Value
(in millions)	Level 1		Level 2		Level 3		Total
Assets
Retail notes	$	—	$	—	$	209	$	209	$	208
Notes receivable	—		—		5		5		5
Liabilities
Debt:
Manufacturing operations
Senior Secured Term Loan Credit Facility, as Amended, due 2017	—		—		719		719		694
8.25% Senior Notes, due 2021	1,233		—		—		1,233		1,181
4.50% Senior Subordinated Convertible Notes, due 2018(A)	—		—		185		185		183
4.75% Senior Subordinated Convertible Notes, due 2019(A)	—		—		383		383		375
Debt of majority-owned dealerships	—		—		28		28		28
Financing arrangements	—		—		21		21		45
Loan Agreement related to 6.50% Tax Exempt Bonds, due 2040	—		243		—		243		225
Promissory Note	—		—		5		5		5
Financed lease obligations	—		—		141		141		141
Other	—		—		24		24		24
Financial Services operations
Asset-backed debt issued by consolidated SPEs, at various rates, due serially through 2018	—		—		984		984		986
Bank revolvers, at fixed and variable rates, due dates from 2015 through 2020	—		—		1,184		1,184		1,205
Commercial paper, at variable rates, program matures in 2017	77		—		—		77		77
Borrowings secured by operating and finance leases, at various rates, due serially through 2018	—		—		29		29		29

	As of October 31, 2014
	Estimated Fair Value								Carrying Value
(in millions)	Level 1		Level 2		Level 3		Total
Assets
Retail notes	$	—	$	—	$	279	$	279	$	275
Notes receivable	—		—		7		7		8
Liabilities
Debt:
Manufacturing operations
Senior Secured Term Loan Credit Facility, as Amended, due 2017	—		—		704		704		694
8.25% Senior Notes, due 2021	1,285		—		—		1,285		1,180
4.50% Senior Subordinated Convertible Notes, due 2018(A)	—		—		196		196		181
4.75% Senior Subordinated Convertible Notes, due 2019(A)	—		—		413		413		371
Debt of majority-owned dealerships	—		—		30		30		30
Financing arrangements	—		—		22		22		48
Loan Agreement related to 6.50% Tax Exempt Bonds, due 2040	—		232		—		232		225
Promissory Note	—		—		10		10		10
Financed lease obligations	—		—		184		184		184
Other	—		—		28		28		29
Financial Services operations
Asset-backed debt issued by consolidated SPEs, at various rates, due serially through 2019	—		—		911		911		914
Bank revolvers, at fixed and variable rates, due dates from 2014 through 2020	—		—		1,214		1,214		1,242
Commercial paper, at variable rates, program matures in 2015	74		—		—		74		74
Borrowings secured by operating and finance leases, at various rates, due serially through 2018	—		—		36		36		36

_________________________

(A) The carrying value represents the consolidated financial statement amount of the debt which excludes the allocation of the conversion feature to equity, while the fair value is based on internally developed valuation techniques such as discounted cash flow modeling for Level 3 convertible notes which include the equity feature.

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Consolidated Statements of Stockholders' Equity (Deficit) (USD $) In Millions	Total	Preferred Stock [Member]	Common Stock [Member]	Additional Paid-in Capital [Member]	Retained Earnings [Member]	Accumulated Other Comprehensive Income (Loss) [Member]	Treasury Stock [Member]	Noncontrolling Interest [Member]
Stockholders' Equity balance at beginning of period at Oct. 31, 2013	$ (3,605)	$ 3	$ 9	$ 2,477	$ (4,063)	$ (1,824)	$ (251)	$ 44
Adjustments to Additional Paid in Capital, Equity Component of Convertible Debt, Tax	16
Net loss attributable to Navistar International Corporation	(545)
Net income (loss)	(525)
Total other comprehensive income	36
Less: Net income attributable to non-controlling interests	20
Transfer from redeemable equity securities upon exercise or expiration of stock options	2			2
Stock-based compensation	9			9
Stock ownership programs	17			(8)			25
Adjustments to Additional Paid in Capital, Other	27			27
Adjustments to Additional Paid in Capital, Equity Component of Convertible Debt, Tax	(5)			(5)
Dividends paid by subsidiaries to non-controlling interest	(30)							(30)
Adjustments to Additional Paid in Capital, Equity Component of Convertible Debt, Repurchase, Tax	3
Stockholders' Equity balance at end of period at Apr. 30, 2014	(4,074)	3	9	2,502	(4,608)	(1,788)	(226)	34
Stockholders' Equity balance at beginning of period at Oct. 31, 2014	(4,620)	3	9	2,500	(4,682)	(2,263)	(221)	34
Net loss attributable to Navistar International Corporation	(106)
Net income (loss)	(90)
Total other comprehensive income	(21)
Less: Net income attributable to non-controlling interests	16
Transfer from redeemable equity securities upon exercise or expiration of stock options	1			1
Stock-based compensation	6			6
Stock ownership programs	(1)			(9)			8
Dividends paid by subsidiaries to non-controlling interest	(20)							(20)
Stockholders' Equity balance at end of period at Apr. 30, 2015	$ (4,745)	$ 3	$ 9	$ 2,498	$ (4,788)	$ (2,284)	$ (213)	$ 30

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Financial Instruments and Commodity Contracts (Tables)

6 Months Ended

Apr. 30, 2015

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Schedule of Derivative Instruments, Gain (Loss) in Statement of Financial Performance [Table Text Block]

	Location in Consolidated Statements of Operations	Three Months Ended April 30,
(in millions)		2015			2014
Interest rate caps	Interest expense	$	—		$	2
Cross currency swaps	Other (income) expense, net	1			(1		)
Foreign currency contracts	Other (income) expense, net	—			1
Commodity forward contracts	Costs of products sold	(5		)	—
Total (income) loss		$	(4	)	$	2

	Location in Consolidated Statements of Operations	Six Months Ended April 30,
(in millions)		2015		2014
Interest rate caps	Interest expense	$	—	$	1
Cross currency swaps	Other (income) expense, net	3		1
Foreign currency contracts	Other (income) expense, net	1		—
Commodity forward contracts	Costs of products sold	5		—
Total loss		$	9	$	2

Schedule of Notional Amounts of Outstanding Derivative Positions [Table Text Block]

The following table presents the outstanding foreign currency contracts as of April 30, 2015 and October 31, 2014:

(in millions)	Currency	Notional Amount		Maturity
As of April 30, 2015
Forward exchange contract	EUR	€	6	May 2015
Forward exchange contract	EUR	€	5	June 2015
Forward exchange contract	EUR	€	5	July 2015
Forward exchange contract	EUR	€	6	August 2015-October 2015(A)
Forward exchange contract	CAD	C$	25	May 2015
Forward exchange contract	CAD	C$	25	June 2015
Forward exchange contract	CAD	C$	25	July 2015
Forward exchange contract	CAD	C$	75	August 2015-October 2015(B)
Forward exchange contract	MXN	₱	763	May 2015
As of October 31, 2014
Forward exchange contract	EUR	€	4	November 2014
Forward exchange contract	EUR	€	4	December 2014
Forward exchange contract	EUR	€	5	January 2015
Forward exchange contract	EUR	€	9	February 2015 - October 2015(C)

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Restructuring and Impairments - Narrative (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended		3 Months Ended
	Apr. 30, 2015	Apr. 30, 2014	Apr. 30, 2015	Apr. 30, 2014	Jan. 31, 2014	Jan. 31, 2015
Restructuring Cost and Reserve [Line Items]
Restructuring charges	$ 6	$ 8	$ 9	$ 11
Asset impairment charges	1	151	8	169
Employee Severance [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring charges		8
North America Truck [Member]
Restructuring Cost and Reserve [Line Items]
Asset impairment charges					18
Minimum [Member] | Chatham [Member] | North America Truck [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring and Related Cost, Expected Cost	0		0
Maximum [Member] | Chatham [Member] | North America Truck [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring and Related Cost, Expected Cost	60		60
Maximum [Member] | Indianapolis and Waukesha Foundry [Member] | North America Truck [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring and Related Cost, Cost Incurred to Date	12		12			13
Brazilian Reporting Unit [Member]
Restructuring Cost and Reserve [Line Items]
Asset impairment charges		149
Goodwill, Impairment Loss	0	142	0	142
Impairment of Intangible Assets, Indefinite-lived (Excluding Goodwill)	$ 0	$ 7	$ 0	$ 7

XML

Postretirement Benefits - Narrative (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended
	Apr. 30, 2015	Apr. 30, 2014	Apr. 30, 2015	Apr. 30, 2014
Defined Benefit Plan Disclosure [Line Items]
Restructuring charges	$ 6	$ 8	$ 9	$ 11
Defined Contribution Plan, Cost Recognized	8	7	17	15
Defined Benefit Plans, Estimated Future Employer Contributions in Current Fiscal Year			51
Pension Benefits
Defined Benefit Plan Disclosure [Line Items]
Employer contributions	$ 32	$ 36	$ 62	$ 65

XML

Loss Per Share Attributable to Navistar International Corporation - Narrative (Details) (USD $)	3 Months Ended		6 Months Ended		1 Months Ended	12 Months Ended
	Apr. 30, 2015	Apr. 30, 2014	Apr. 30, 2015	Apr. 30, 2014	Oct. 31, 2009	Oct. 31, 2014	Jan. 31, 2015
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Shares of Warrants Unwound	1,939,376	6,523,319
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount	16,000,000	24,000,000	16,000,000	27,300,000
Shares related to warrants		4,800,000		8,100,000
Three Point Zero Percent Senior Subordinated Convertible Notes [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Shares of Warrants Unwound	1,939,376	6,523,319
Class of Warrant or Right, Outstanding							2,900,000
Shares related to convertible notes		3,300,000		7,300,000
Three Point Zero Percent Senior Subordinated Convertible Notes [Member] | Convertible Debt Securities [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Debt Instrument, Convertible, Conversion Ratio			19.891
Debt Instrument Convertible Conversion Ratio Basis			1,000
Option Indexed to Issuer's Equity, Strike Price					$ 50.27
Investment Warrants, Exercise Price			60.14
Four Point Five Zero Senior Subordinated Convertible Notes [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Shares related to convertible notes	3,400,000	3,400,000	3,400,000	3,400,000
Four Point Five Zero Senior Subordinated Convertible Notes [Member] | Convertible Debt Securities [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Debt Instrument, Convertible, Conversion Ratio			17.1233
Debt Instrument Convertible Conversion Ratio Basis			1,000
Debt Instrument, Convertible, Conversion Price							58.40
Four Point Seven Five Senior Subordinated Convertible Notes [Member] [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Debt Instrument, Convertible, Conversion Ratio			18.4946
Option Indexed to Issuer's Equity, Strike Price			54.07
Shares related to convertible notes	7,600,000		7,600,000	3,800,000		7,600,000
Four Point Seven Five Senior Subordinated Convertible Notes [Member] [Member] | Convertible Debt Securities [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Debt Instrument Convertible Conversion Ratio Basis			1,000

XML

Consolidated Statements of Operations (USD $) In Millions, except Per Share data, unless otherwise specified	3 Months Ended		6 Months Ended
	Apr. 30, 2015	Apr. 30, 2014	Apr. 30, 2015	Apr. 30, 2014
Sales and revenues
Sales of manufactured products, net	$ 2,658	$ 2,708	$ 5,043	$ 4,877
Finance revenues	35	38	71	77
Sales and revenues, net	2,693	2,746	5,114	4,954
Costs and expenses
Costs of products sold	2,360	2,468	4,405	4,482
Restructuring charges	6	8	9	11
Asset impairment charges	1	151	8	169
Selling, general and administrative expenses	243	237	484	476
Engineering and product development costs	76	83	155	173
Interest expense	75	74	152	156
Other (income) expense, net	(28)	(8)	(31)	6
Total costs and expenses	2,733	3,013	5,182	5,473
Equity in income of non-consolidated affiliates	1	3	3	3
Income (loss) before income taxes	(39)	(264)	(65)	(516)
Income tax expense	(18)	(23)	(25)	(11)
Earnings (loss) from continuing operations	(57)	(287)	(90)	(527)
Income from discontinued operations, net of tax	0	1	0	2
Net income (loss)	(57)	(286)	(90)	(525)
Less: Net income attributable to non-controlling interests	7	11	16	20
Net income (loss) attributable to Navistar International Corporation	(64)	(297)	(106)	(545)
Loss from continuing operations, net of tax	(64)	(298)	(106)	(547)
Income from discontinued operations, net of tax	$ 0	$ 1	$ 0	$ 2
Earnings (loss) per share attributable to Navistar International Corporation:
Basic: Loss from Continuing Operations (in dollars per share)	$ (0.78)	$ (3.66)	$ (1.30)	$ (6.73)
Basic: Income (Loss) from Discontinued Operations (in dollars per share)	$ 0.00	$ 0.01	$ 0.00	$ 0.03
Basic (in dollars per share)	$ (0.78)	$ (3.65)	$ (1.30)	$ (6.70)
Diluted: Loss from Continuing Operations (in dollars per share)	$ (0.78)	$ (3.66)	$ (1.30)	$ (6.73)
Diluted: Income (Loss) from Discontinued Operations (in dollars per share)	$ 0.00	$ 0.01	$ 0.00	$ 0.03
Diluted (in dollars per share)	$ (0.78)	$ (3.65)	$ (1.30)	$ (6.70)
Weighted average shares outstanding:
Basic (in shares)	81.6	81.4	81.5	81.3
Diluted (in shares)	81.6	81.4	81.5	81.3

XML

Finance Receivables - Schedule of Finance Revenues (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended
	Apr. 30, 2015	Apr. 30, 2014	Apr. 30, 2015	Apr. 30, 2014
Finance Revenues [Line Items]
Retail notes and finance leases revenue	$ 12	$ 16	$ 25	$ 33
Gross finance revenues	60	57	120	112
Less: Intercompany revenues	(25)	(19)	(49)	(35)
Finance revenues	35	38	71	77
Financing Receivable [Member]
Finance Revenues [Line Items]
Operating lease revenue	15	15	30	29
Wholesale Portfolio [Member] | Notes Receivable [Member]
Finance Revenues [Line Items]
Interest Income, Operating	24	19	48	37
Retail And Wholesale Portfolios [Member]
Finance Revenues [Line Items]
Interest Income, Operating	$ 9	$ 7	$ 17	$ 13

XML

Consolidated Balance Sheets (Parenthetical) (USD $) In Millions, except Per Share data, unless otherwise specified	Apr. 30, 2015	Oct. 31, 2014
Statement of Financial Position [Abstract]
Accumulated Depreciation, Depletion and Amortization, Property, Plant, and Equipment	$ 2,590	$ 2,535
Finite-Lived Intangible Assets, Accumulated Amortization	$ 113	$ 109
Common stock, par value	$ 0.10	$ 0.10
Common stock, shares authorized	220	220
Common stock, shares issued	86.8	86.8
Common stock held in treasury, shares	5.3	5.4

XML

Fair Value Measurements - Carrying Values and Estimated Fair Values of Financial Instruments (Details) (USD $) In Millions, unless otherwise specified	Apr. 30, 2015		Oct. 31, 2014
Reported Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Retail Notes	$ 208		$ 275
Notes Receivable	5		8
Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Retail Notes	209		279
Notes Receivable	5		7
Fair Value, Inputs, Level 1 [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Retail Notes	0		0
Notes Receivable	0		0
Fair Value, Inputs, Level 2 [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Retail Notes	0		0
Notes Receivable	0		0
Fair Value, Inputs, Level 3 [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Retail Notes	209		279
Notes Receivable	5		7
Line of Credit [Member] | Manufacturing Operations [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt	694		694
Line of Credit [Member] | Manufacturing Operations [Member] | Reported Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt	694		694
Line of Credit [Member] | Manufacturing Operations [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	719		704
Line of Credit [Member] | Manufacturing Operations [Member] | Fair Value, Inputs, Level 1 [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	0		0
Line of Credit [Member] | Manufacturing Operations [Member] | Fair Value, Inputs, Level 2 [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	0		0
Line of Credit [Member] | Manufacturing Operations [Member] | Fair Value, Inputs, Level 3 [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	719		704
Line of Credit [Member] | Financial Services Operations [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt	1,205		1,242
Line of Credit [Member] | Financial Services Operations [Member] | Reported Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt	1,205		1,242
Line of Credit [Member] | Financial Services Operations [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	1,184		1,214
Line of Credit [Member] | Financial Services Operations [Member] | Fair Value, Inputs, Level 1 [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	0		0
Line of Credit [Member] | Financial Services Operations [Member] | Fair Value, Inputs, Level 2 [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	0		0
Line of Credit [Member] | Financial Services Operations [Member] | Fair Value, Inputs, Level 3 [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	1,184		1,214
Debt Of Majority Owned Dealerships [Member] | Manufacturing Operations [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt	28		30
Debt Of Majority Owned Dealerships [Member] | Manufacturing Operations [Member] | Reported Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt	28		30
Debt Of Majority Owned Dealerships [Member] | Manufacturing Operations [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	28		30
Debt Of Majority Owned Dealerships [Member] | Manufacturing Operations [Member] | Fair Value, Inputs, Level 1 [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	0		0
Debt Of Majority Owned Dealerships [Member] | Manufacturing Operations [Member] | Fair Value, Inputs, Level 2 [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	0		0
Debt Of Majority Owned Dealerships [Member] | Manufacturing Operations [Member] | Fair Value, Inputs, Level 3 [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	28		30
Financing Arrangements [Member] | Manufacturing Operations [Member] | Reported Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt	45		48
Financing Arrangements [Member] | Manufacturing Operations [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	21		22
Financing Arrangements [Member] | Manufacturing Operations [Member] | Fair Value, Inputs, Level 1 [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	0		0
Financing Arrangements [Member] | Manufacturing Operations [Member] | Fair Value, Inputs, Level 2 [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	0		0
Financing Arrangements [Member] | Manufacturing Operations [Member] | Fair Value, Inputs, Level 3 [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	21		22
Tax Exempt Bond [Member] | Manufacturing Operations [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt	225		225
Tax Exempt Bond [Member] | Manufacturing Operations [Member] | Reported Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt	225		225
Tax Exempt Bond [Member] | Manufacturing Operations [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	243		232
Tax Exempt Bond [Member] | Manufacturing Operations [Member] | Fair Value, Inputs, Level 1 [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	0		0
Tax Exempt Bond [Member] | Manufacturing Operations [Member] | Fair Value, Inputs, Level 2 [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	243		232
Tax Exempt Bond [Member] | Manufacturing Operations [Member] | Fair Value, Inputs, Level 3 [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	0		0
Promissory Note [Member] | Manufacturing Operations [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt	5		10
Promissory Note [Member] | Manufacturing Operations [Member] | Reported Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt	5		10
Promissory Note [Member] | Manufacturing Operations [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	5		10
Promissory Note [Member] | Manufacturing Operations [Member] | Fair Value, Inputs, Level 1 [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	0		0
Promissory Note [Member] | Manufacturing Operations [Member] | Fair Value, Inputs, Level 2 [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	0		0
Promissory Note [Member] | Manufacturing Operations [Member] | Fair Value, Inputs, Level 3 [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	5		10
Financed lease obligations [Member] | Manufacturing Operations [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt	141		184
Financed lease obligations [Member] | Manufacturing Operations [Member] | Reported Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt	141		184
Financed lease obligations [Member] | Manufacturing Operations [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	141		184
Financed lease obligations [Member] | Manufacturing Operations [Member] | Fair Value, Inputs, Level 1 [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	0		0
Financed lease obligations [Member] | Manufacturing Operations [Member] | Fair Value, Inputs, Level 2 [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	0		0
Financed lease obligations [Member] | Manufacturing Operations [Member] | Fair Value, Inputs, Level 3 [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	141		184
Notes Payable, Other Payables [Member] | Manufacturing Operations [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt	24		29
Notes Payable, Other Payables [Member] | Manufacturing Operations [Member] | Reported Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt	24		29
Notes Payable, Other Payables [Member] | Manufacturing Operations [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	24		28
Notes Payable, Other Payables [Member] | Manufacturing Operations [Member] | Fair Value, Inputs, Level 1 [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	0		0
Notes Payable, Other Payables [Member] | Manufacturing Operations [Member] | Fair Value, Inputs, Level 2 [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	0		0
Notes Payable, Other Payables [Member] | Manufacturing Operations [Member] | Fair Value, Inputs, Level 3 [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	24		28
Secured Debt [Member] | Financial Services Operations [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt	986		914
Secured Debt [Member] | Financial Services Operations [Member] | Reported Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt	986		914
Secured Debt [Member] | Financial Services Operations [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	984		911
Secured Debt [Member] | Financial Services Operations [Member] | Fair Value, Inputs, Level 1 [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	0		0
Secured Debt [Member] | Financial Services Operations [Member] | Fair Value, Inputs, Level 2 [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	0		0
Secured Debt [Member] | Financial Services Operations [Member] | Fair Value, Inputs, Level 3 [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	984		911
Commercial Paper [Member] | Financial Services Operations [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt	77		74
Commercial Paper [Member] | Financial Services Operations [Member] | Reported Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt	77		74
Commercial Paper [Member] | Financial Services Operations [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	77		74
Commercial Paper [Member] | Financial Services Operations [Member] | Fair Value, Inputs, Level 1 [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	77
Commercial Paper [Member] | Financial Services Operations [Member] | Fair Value, Inputs, Level 1 [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value			74
Commercial Paper [Member] | Financial Services Operations [Member] | Fair Value, Inputs, Level 2 [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	0
Commercial Paper [Member] | Financial Services Operations [Member] | Fair Value, Inputs, Level 2 [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value			0
Commercial Paper [Member] | Financial Services Operations [Member] | Fair Value, Inputs, Level 3 [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	0
Commercial Paper [Member] | Financial Services Operations [Member] | Fair Value, Inputs, Level 3 [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value			0
Borrowings Secured By Operating and Finance Leases [Member] | Financial Services Operations [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt	29		36
Borrowings Secured By Operating and Finance Leases [Member] | Financial Services Operations [Member] | Reported Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt	29		36
Borrowings Secured By Operating and Finance Leases [Member] | Financial Services Operations [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	29		36
Borrowings Secured By Operating and Finance Leases [Member] | Financial Services Operations [Member] | Fair Value, Inputs, Level 1 [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	0		0
Borrowings Secured By Operating and Finance Leases [Member] | Financial Services Operations [Member] | Fair Value, Inputs, Level 2 [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	0		0
Borrowings Secured By Operating and Finance Leases [Member] | Financial Services Operations [Member] | Fair Value, Inputs, Level 3 [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	29		36
Eight Point Two Five Percent Senior Notes [Member] | Notes Payable to Banks [Member] | Manufacturing Operations [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt	1,181		1,180
Eight Point Two Five Percent Senior Notes [Member] | Notes Payable to Banks [Member] | Manufacturing Operations [Member] | Reported Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt	1,181		1,180
Eight Point Two Five Percent Senior Notes [Member] | Notes Payable to Banks [Member] | Manufacturing Operations [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	1,233		1,285
Eight Point Two Five Percent Senior Notes [Member] | Notes Payable to Banks [Member] | Manufacturing Operations [Member] | Fair Value, Inputs, Level 1 [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	1,233		1,285
Eight Point Two Five Percent Senior Notes [Member] | Notes Payable to Banks [Member] | Manufacturing Operations [Member] | Fair Value, Inputs, Level 2 [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	0		0
Eight Point Two Five Percent Senior Notes [Member] | Notes Payable to Banks [Member] | Manufacturing Operations [Member] | Fair Value, Inputs, Level 3 [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	0		0
Four Point Five Zero Senior Subordinated Convertible Notes [Member] | Convertible Subordinated Debt [Member] | Manufacturing Operations [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt	183		181
Four Point Five Zero Senior Subordinated Convertible Notes [Member] | Convertible Subordinated Debt [Member] | Manufacturing Operations [Member] | Reported Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt	183	[1]	181	[1]
Four Point Five Zero Senior Subordinated Convertible Notes [Member] | Convertible Subordinated Debt [Member] | Manufacturing Operations [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	185	[1]	196	[1]
Four Point Five Zero Senior Subordinated Convertible Notes [Member] | Convertible Subordinated Debt [Member] | Manufacturing Operations [Member] | Fair Value, Inputs, Level 1 [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	0	[1]	0	[1]
Four Point Five Zero Senior Subordinated Convertible Notes [Member] | Convertible Subordinated Debt [Member] | Manufacturing Operations [Member] | Fair Value, Inputs, Level 2 [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	0	[1]	0	[1]
Four Point Five Zero Senior Subordinated Convertible Notes [Member] | Convertible Subordinated Debt [Member] | Manufacturing Operations [Member] | Fair Value, Inputs, Level 3 [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	185	[1]	196	[1]
Four Point Seven Five Senior Subordinated Convertible Notes [Member] [Member] | Convertible Subordinated Debt [Member] | Manufacturing Operations [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt	375		371
Four Point Seven Five Senior Subordinated Convertible Notes [Member] [Member] | Convertible Subordinated Debt [Member] | Manufacturing Operations [Member] | Reported Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt	375	[1]	371	[1]
Four Point Seven Five Senior Subordinated Convertible Notes [Member] [Member] | Convertible Subordinated Debt [Member] | Manufacturing Operations [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	383	[1]	413	[1]
Four Point Seven Five Senior Subordinated Convertible Notes [Member] [Member] | Convertible Subordinated Debt [Member] | Manufacturing Operations [Member] | Fair Value, Inputs, Level 1 [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	0	[1]	0	[1]
Four Point Seven Five Senior Subordinated Convertible Notes [Member] [Member] | Convertible Subordinated Debt [Member] | Manufacturing Operations [Member] | Fair Value, Inputs, Level 2 [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	0	[1]	0
Four Point Seven Five Senior Subordinated Convertible Notes [Member] [Member] | Convertible Subordinated Debt [Member] | Manufacturing Operations [Member] | Fair Value, Inputs, Level 3 [Member] | Estimate of Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Fair Value	$ 383	[1]	$ 413	[1]

[1] The carrying value represents the consolidated financial statement amount of the debt which excludes the allocation of the conversion feature to equity, while the fair value is based on internally developed valuation techniques such as discounted cash flow modeling for Level 3 convertible notes which include the equity feature.

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Loss Per Share Attributable to Navistar International Corporation (Tables)

6 Months Ended

Apr. 30, 2015

Earnings Per Share [Abstract]

Schedule of Earnings Per Share Reconciliation [Table Text Block]

	Three Months Ended April 30,						Six Months Ended April 30,
(in millions, except per share data)	2015			2014			2015			2014
Numerator:
Amounts attributable to Navistar International Corporation common stockholders:
Loss from continuing operations, net of tax	$	(64	)	$	(298	)	$	(106	)	$	(547	)
Income from discontinued operations, net of tax	—			1			—			2
Net loss	$	(64	)	$	(297	)	$	(106	)	$	(545	)
Denominator:
Weighted average shares outstanding:
Basic	81.6			81.4			81.5			81.3
Effect of dilutive securities	—			—			—			—
Diluted	81.6			81.4			81.5			81.3
Earnings (loss) per share attributable to Navistar International Corporation:
Basic:
Continuing operations	$	(0.78	)	$	(3.66	)	$	(1.30	)	$	(6.73	)
Discontinued operations	—			0.01			—			0.03
Net loss	$	(0.78	)	$	(3.65	)	$	(1.30	)	$	(6.70	)
Diluted:
Continuing operations	$	(0.78	)	$	(3.66	)	$	(1.30	)	$	(6.73	)
Discontinued operations	—			0.01			—			0.03
Net loss	$	(0.78	)	$	(3.65	)	$	(1.30	)	$	(6.70	)

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Segment Reporting - Narrative (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended			6 Months Ended
	Apr. 30, 2015	Jan. 31, 2015	Apr. 30, 2014	Apr. 30, 2015 segments	Apr. 30, 2014
Segment Reporting Information [Line Items]
Number Of Segments				4
Intersegment sales and revenues	$ 0	$ 35	$ 0	$ 0	$ 0
Sales and revenues, net	2,693		2,746	5,114	4,954
North America Truck [Member]
Segment Reporting Information [Line Items]
Intersegment sales and revenues	33		60	72	120
Sales and revenues, net	1,966		1,889	3,636	3,340
North America Parts [Member]
Segment Reporting Information [Line Items]
Intersegment sales and revenues	6		16	18	28
Sales and revenues, net	613		630	1,239	1,216
Corporate And Eliminations [Member]
Segment Reporting Information [Line Items]
Intersegment sales and revenues	(79)		(101)	(168)	(197)
Sales and revenues, net	(76)		(101)	(163)	(197)
Restatement Adjustment [Member] | North America Truck [Member]
Segment Reporting Information [Line Items]
Intersegment sales and revenues		39
Sales and revenues, net		1,670
Restatement Adjustment [Member] | Corporate And Eliminations [Member]
Segment Reporting Information [Line Items]
Intersegment sales and revenues		(89)
Sales and revenues, net		$ (87)

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Loss Per Share Attributable to Navistar International Corporation

6 Months Ended

Apr. 30, 2015

Earnings Per Share [Abstract]

Loss Per Share Attributable to Navistar International Corporation

Earnings (Loss) Per Share Attributable to Navistar International Corporation

The following table presents the information used in the calculation of our basic and diluted income (loss) per share for continuing operations, discontinued operations, and net loss, all attributable to Navistar International Corporation:

	Three Months Ended April 30,						Six Months Ended April 30,
(in millions, except per share data)	2015			2014			2015			2014
Numerator:
Amounts attributable to Navistar International Corporation common stockholders:
Loss from continuing operations, net of tax	$	(64	)	$	(298	)	$	(106	)	$	(547	)
Income from discontinued operations, net of tax	—			1			—			2
Net loss	$	(64	)	$	(297	)	$	(106	)	$	(545	)
Denominator:
Weighted average shares outstanding:
Basic	81.6			81.4			81.5			81.3
Effect of dilutive securities	—			—			—			—
Diluted	81.6			81.4			81.5			81.3
Earnings (loss) per share attributable to Navistar International Corporation:
Basic:
Continuing operations	$	(0.78	)	$	(3.66	)	$	(1.30	)	$	(6.73	)
Discontinued operations	—			0.01			—			0.03
Net loss	$	(0.78	)	$	(3.65	)	$	(1.30	)	$	(6.70	)
Diluted:
Continuing operations	$	(0.78	)	$	(3.66	)	$	(1.30	)	$	(6.73	)
Discontinued operations	—			0.01			—			0.03
Net loss	$	(0.78	)	$	(3.65	)	$	(1.30	)	$	(6.70	)

The conversion rate on our 2014 Convertible Notes were 19.891 shares of common stock per $1,000 principal amount of 2014 Convertible Notes, equivalent to an initial conversion price of $50.27 per share of common stock. In connection with the sale of the 2014 Convertible Notes, we sold warrants to various counterparties to purchase shares of our common stock from us at an exercise price of $60.14 per share. The 2014 Convertible Notes and warrants were anti-dilutive when calculating diluted earnings per share when our average stock price is less than $50.27 and $60.14, respectively. During the second quarter of 2014, the Company unwound warrants representing 6.5 million shares associated with the repurchased 2014 Convertible Notes. On October 15, 2014, upon maturity the 2014 Convertible Notes were repaid in full. During the first quarter of 2015, the Company unwound warrants representing 1.9 million shares associated with the 2014 Convertible Notes, and the remaining 2.9 million warrants expired worthless on April 10, 2015.

The conversion rate on our 4.50% Senior Subordinated Convertible Notes due 2018 ("the 2018 Convertible Notes") is 17.1233 shares of common stock per $1,000 principal amount of 2018 Convertible Notes, equivalent to an initial conversion price of approximately $58.40 per share of common stock. The 2018 Convertible Notes are anti-dilutive when calculating diluted earnings per share when our average stock price is less than $58.40.

The conversion rate on our 2019 Convertible Notes is 18.4946 shares of common stock per $1,000 principal amount of 2019 Convertible Notes, equivalent to an initial conversion price of approximately $54.07 per share of common stock. The 2019 Convertible Notes are anti-dilutive when calculating diluted earnings per share when our average stock price is less than $54.07.

The computation of diluted earnings per share also excludes outstanding options and other common stock equivalents in periods where inclusion of such potential common stock instruments would be anti-dilutive.

For the three and six months ended April 30, 2015 and 2014, no dilutive securities were included in the computation of diluted loss per share since they would have been anti-dilutive due to the net loss attributable to Navistar International Corporation. Additionally, certain securities have been excluded from the computation of earnings per share, as our average stock price was less than their respective exercise prices. For both the three and six months ended April 30, 2015, the aggregate shares not included were 16.0 million. For the three and six months ended April 30, 2014, the aggregate shares not included were 24.0 million and 27.3 million, respectively.

For both the three and six months ended April 30, 2015, the aggregate shares not included in the computation of earnings per share were primarily comprised of 3.4 million shares related to the 2018 Convertible Notes, and 7.6 million shares related to the 2019 Convertible Notes.

For the three months ended April 30, 2014, the aggregate shares not included in the computation of earnings per share were primarily comprised of 4.8 million shares related to the warrants, 3.3 million shares related to the 2014 Convertible Notes, 3.4 million shares related to the 2018 Convertible Notes, and 7.6 million shares related to the 2019 Convertible Notes.

For the six months ended April 30, 2014, the aggregate shares not included in the computation of earnings per share were primarily comprised of 8.1 million shares related to the warrants, 7.3 million shares related to the 2014 Convertible Notes, 3.4 million shares related to the 2018 Convertible Notes, and 3.8 million shares related to the 2019 Convertible Notes.

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Condensed Consolidating Guarantor and Non-Guarantor Financial Information (Tables)

6 Months Ended

Apr. 30, 2015

Condensed Consolidating Guarantor and Non-Guarantor [Abstract]

Schedule of Condensed Income Statement [Table Text Block]

Condensed Consolidating Statement of Operations for the Three Months Ended April 30, 2015
(in millions)	NIC			Navistar, Inc.			Non-Guarantor Subsidiaries			Eliminations and Other			Consolidated
Sales and revenues, net	$	—		$	2,009		$	1,943		$	(1,259	)	$	2,693
Costs of products sold	—			1,864			1,735			(1,239		)	2,360
Restructuring charges	—			—			6			—			6
Asset impairment charges	—			1			—			—			1
All other operating expenses (income)	27			282			79			(22		)	366
Total costs and expenses	27			2,147			1,820			(1,261		)	2,733
Equity in income (loss) of affiliates	(37		)	64			—			(26		)	1
Income (loss) before income taxes	(64		)	(74		)	123			(24		)	(39		)
Income tax expense	—			(1		)	(17		)	—			(18		)
Earnings (loss) from continuing operations	(64		)	(75		)	106			(24		)	(57		)
Income from discontinued operations, net of tax	—			—			—			—			—
Net income (loss)	(64		)	(75		)	106			(24		)	(57		)
Less: Net income attributable to non-controlling interests	—			—			7			—			7
Net income (loss) attributable to Navistar International Corporation	$	(64	)	$	(75	)	$	99		$	(24	)	$	(64	)

Condensed Consolidating Statement of Operations for the Three Months Ended April 30, 2014
(in millions)	NIC			Navistar, Inc.			Non-Guarantor Subsidiaries			Eliminations and Other			Consolidated
Sales and revenues, net	$	—		$	1,893		$	2,061		$	(1,208	)	$	2,746
Costs of products sold	—			1,797			1,862			(1,191		)	2,468
Restructuring charges	—			8			—			—			8
Asset impairment charges	—			—			153			(2		)	151
All other operating expenses (income)	41			273			89			(17		)	386
Total costs and expenses	41			2,078			2,104			(1,210		)	3,013
Equity in income (loss) of affiliates	(269		)	(141		)	2			411			3
Income (loss) before income taxes	(310		)	(326		)	(41		)	413			(264		)
Income tax benefit (expense)	13			(8		)	(28		)	—			(23		)
Earnings (loss) from continuing operations	(297		)	(334		)	(69		)	413			(287		)
Income from discontinued operations, net of tax	—			—			1			—			1
Net income (loss)	(297		)	(334		)	(68		)	413			(286		)
Less: Net income attributable to non-controlling interests	—			—			11			—			11
Net income (loss) attributable to Navistar International Corporation	$	(297	)	$	(334	)	$	(79	)	$	413		$	(297	)

Condensed Consolidating Statement of Operations for the Six Months Ended April 30, 2014
(in millions)	NIC			Navistar, Inc.			Non-Guarantor Subsidiaries			Eliminations and Other			Consolidated
Sales and revenues, net	$	—		$	3,317		$	3,790		$	(2,153	)	$	4,954
Costs of products sold	—			3,222			3,393			(2,133		)	4,482
Restructuring charges	—			10			1			—			11
Asset impairment charges	—			—			171			(2		)	169
All other operating expenses (income)	77			514			248			(28		)	811
Total costs and expenses	77			3,746			3,813			(2,163		)	5,473
Equity in income (loss) of affiliates	(481		)	(152		)	1			635			3
Income (loss) before income taxes	(558		)	(581		)	(22		)	645			(516		)
Income tax benefit (expense)	13			(1		)	(23		)	—			(11		)
Earnings (loss) from continuing operations	(545		)	(582		)	(45		)	645			(527		)
Income from discontinued operations, net of tax	—			—			2			—			2
Net income (loss)	(545		)	(582		)	(43		)	645			(525		)
Less: Net income attributable to non-controlling interests	—			—			20			—			20
Net income (loss) attributable to Navistar International Corporation	$	(545	)	$	(582	)	$	(63	)	$	645		$	(545	)

Condensed Consolidating Statement of Operations for the Six Months Ended April 30, 2015
(in millions)	NIC			Navistar, Inc.			Non-Guarantor Subsidiaries			Eliminations and Other			Consolidated
Sales and revenues, net	$	—		$	3,619		$	3,711		$	(2,216	)	$	5,114
Costs of products sold	—			3,273			3,305			(2,173		)	4,405
Restructuring charges	—			3			6			—			9
Asset impairment charges	—			8			—			—			8
All other operating expenses (income)	50			546			204			(40		)	760
Total costs and expenses	50			3,830			3,515			(2,213		)	5,182
Equity in income (loss) of affiliates	(56		)	79			1			(21		)	3
Income (loss) before income taxes	(106		)	(132		)	197			(24		)	(65		)
Income tax expense	—			(2		)	(23		)	—			(25		)
Earnings (loss) from continuing operations	(106		)	(134		)	174			(24		)	(90		)
Income from discontinued operations, net of tax	—			—			—			—			—
Net income (loss)	(106		)	(134		)	174			(24		)	(90		)
Less: Net income attributable to non-controlling interests	—			—			16			—			16
Net income (loss) attributable to Navistar International Corporation	$	(106	)	$	(134	)	$	158		$	(24	)	$	(106	)

Schedule of Condensed Statement of Comprehensive Income [Table Text Block]

Condensed Consolidating Statement of Comprehensive Income (Loss) for the Six Months Ended April 30, 2014
(in millions)	NIC			Navistar, Inc.			Non-Guarantor Subsidiaries			Eliminations and Other			Consolidated
Net income (loss) attributable to Navistar International Corporation	$	(545	)	$	(582	)	$	(63	)	$	645		$	(545	)
Other comprehensive income (loss):
Foreign currency translation adjustment	(14		)	—			(14		)	14			(14		)
Defined benefit plans (net of tax of $(1) $0, $(1), $1, and $(1), respectively)	50			50			—			(50		)	50
Total other comprehensive income (loss)	36			50			(14		)	(36		)	36
Total comprehensive income (loss) attributable to Navistar International Corporation	$	(509	)	$	(532	)	$	(77	)	$	609		$	(509	)

Condensed Consolidating Statement of Comprehensive Income (Loss) for the Three Months Ended April 30, 2015
(in millions)	NIC			Navistar, Inc.			Non-Guarantor Subsidiaries			Eliminations and Other			Consolidated
Net income (loss) attributable to Navistar International Corporation	$	(64	)	$	(75	)	$	99		$	(24	)	$	(64	)
Other comprehensive income (loss):
Foreign currency translation adjustment	(27		)	—			(27		)	27			(27		)
Defined benefit plans (net of tax of $(0), for all entities)	33			31			2			(33		)	33
Total other comprehensive income (loss)	6			31			(25		)	(6		)	6
Total comprehensive income (loss) attributable to Navistar International Corporation	$	(58	)	$	(44	)	$	74		$	(30	)	$	(58	)

Condensed Consolidating Statement of Comprehensive Income (Loss) for the Three Months Ended April 30, 2014
(in millions)	NIC			Navistar, Inc.			Non-Guarantor Subsidiaries			Eliminations and Other			Consolidated
Net income (loss) attributable to Navistar International Corporation	$	(297	)	$	(334	)	$	(79	)	$	413		$	(297	)
Other comprehensive income (loss):
Foreign currency translation adjustment	48			—			48			(48		)	48
Defined benefit plans (net of tax of $0, for all entities)	25			25			—			(25		)	25
Total other comprehensive income (loss)	73			25			48			(73		)	73
Total comprehensive income (loss) attributable to Navistar International Corporation	$	(224	)	$	(309	)	$	(31	)	$	340		$	(224	)

Condensed Consolidating Statement of Comprehensive Income (Loss) for the Six Months Ended April 30, 2015
(in millions)	NIC			Navistar, Inc.			Non-Guarantor Subsidiaries			Eliminations and Other			Consolidated
Net income (loss) attributable to Navistar International Corporation	$	(106	)	$	(134	)	$	158		$	(24	)	$	(106	)
Other comprehensive income (loss):
Foreign currency translation adjustment	(86		)	—			(86		)	86			(86		)
Defined benefit plans (net of tax of $(1), $(0), $(1), $1, and $(1), respectively)	65			62			3			(65		)	65
Total other comprehensive income (loss)	(21		)	62			(83		)	21			(21		)
Total comprehensive income (loss) attributable to Navistar International Corporation	$	(127	)	$	(72	)	$	75		$	(3	)	$	(127	)

Schedule of Condensed Balance Sheet [Table Text Block]

Condensed Consolidating Balance Sheet as of April 30, 2015
(in millions)	NIC			Navistar, Inc.			Non-Guarantor Subsidiaries			Eliminations and Other			Consolidated
Assets
Cash and cash equivalents	$	163		$	37		$	383		$	—		$	583
Marketable securities	150			—			123			—			273
Restricted cash	17			6			90			—			113
Finance and other receivables, net	3			132			2,558			(19		)	2,674
Inventories	—			785			475			(15		)	1,245
Investments in non-consolidated affiliates	(7,322		)	6,495			65			830			68
Property and equipment, net	—			768			646			(7		)	1,407
Goodwill	—			—			38			—			38
Deferred taxes, net	5			9			158			—			172
Other	32			141			179			—			352
Total assets	$	(6,952	)	$	8,373		$	4,715		$	789		$	6,925
Liabilities and stockholders’ equity (deficit)
Debt	$	1,965		$	887		$	2,357		$	(6	)	$	5,203
Postretirement benefits liabilities	—			2,639			227			—			2,866
Amounts due to (from) affiliates	(7,749		)	11,963			(4,352		)	138			—
Other liabilities	3,606			249			(182		)	(73		)	3,600
Total liabilities	(2,178		)	15,738			(1,950		)	59			11,669
Redeemable equity securities	1			—			—			—			1
Stockholders’ equity attributable to non-controlling interest	—			—			30			—			30
Stockholders’ equity (deficit) attributable to Navistar International Corporation	(4,775		)	(7,365		)	6,635			730			(4,775		)
Total liabilities and stockholders’ equity (deficit)	$	(6,952	)	$	8,373		$	4,715		$	789		$	6,925

Condensed Consolidating Balance Sheet as of October 31, 2014
(in millions)	NIC			Navistar, Inc.			Non-Guarantor Subsidiaries			Eliminations and Other			Consolidated
Assets
Cash and cash equivalents	$	101		$	53		$	343		$	—		$	497
Marketable securities	379			—			226			—			605
Restricted cash	19			4			148			—			171
Finance and other receivables, net	—			124			2,504			(12		)	2,616
Inventories	—			792			539			(12		)	1,319
Investments in non-consolidated affiliates	(7,245		)	6,410			71			837			73
Property and equipment, net	—			827			740			(5		)	1,562
Goodwill	—			—			38			—			38
Deferred taxes, net	5			9			185			1			200
Other	34			137			194			(3		)	362
Total assets	$	(6,707	)	$	8,356		$	4,988		$	806		$	7,443
Liabilities and stockholders’ equity (deficit)
Debt	$	1,958		$	937		$	2,336		$	(7	)	$	5,224
Postretirement benefits liabilities	—			2,712			243			—			2,955
Amounts due to (from) affiliates	(7,618		)	11,739			(4,267		)	146			—
Other liabilities	3,605			370			(22		)	(71		)	3,882
Total liabilities	(2,055		)	15,758			(1,710		)	68			12,061
Redeemable equity securities	2			—			—			—			2
Stockholders’ equity attributable to non-controlling interest	—			—			34			—			34
Stockholders’ equity (deficit) attributable to Navistar International Corporation	(4,654		)	(7,402		)	6,664			738			(4,654		)
Total liabilities and stockholders’ equity (deficit)	$	(6,707	)	$	8,356		$	4,988		$	806		$	7,443

Schedule of Condensed Cash Flow Statement [Table Text Block]

Condensed Consolidating Statement of Cash Flows for the Six Months Ended April 30, 2015
(in millions)	NIC			Navistar, Inc.			Non-Guarantor Subsidiaries			Eliminations and Other			Consolidated
Net cash provided by (used in) operations	$	(168	)	$	41		$	(188	)	$	78		$	(237	)
Cash flows from investment activities
Net change in restricted cash and cash equivalents	1			(2		)	54			—			53
Net sales of marketable securities	229			—			103			—			332
Capital expenditures and purchase of equipment leased to others	—			(30		)	(35		)	—			(65		)
Other investing activities	—			7			5			—			12
Net cash provided by (used in) investment activities	230			(25		)	127			—			332
Cash flows from financing activities
Net borrowings (repayments) of debt	—			(52		)	66			2			16
Other financing activities	—			20			61			(80		)	1
Net cash provided by (used in) financing activities	—			(32		)	127			(78		)	17
Effect of exchange rate changes on cash and cash equivalents	—			—			(26		)	—			(26		)
Increase (decrease) in cash and cash equivalents	62			(16		)	40			—			86
Cash and cash equivalents at beginning of the period	101			53			343			—			497
Cash and cash equivalents at end of the period	$	163		$	37		$	383		$	—		$	583

Condensed Consolidating Statement of Cash Flows for the Six Months Ended April 30, 2014
(in millions)	NIC			Navistar, Inc.			Non-Guarantor Subsidiaries			Eliminations and Other			Consolidated
Net cash provided by (used in) operations	$	(458	)	$	(961	)	$	85		$	1,008		$	(326	)
Cash flows from investment activities
Net change in restricted cash and cash equivalents	5			(1		)	(25		)	—			(21		)
Net sales of marketable securities	389			—			(93		)	—			296
Capital expenditures and purchase of equipment leased to others	—			(67		)	(91		)	—			(158		)
Other investing activities	—			8			17			—			25
Net cash provided by (used in) investment activities	394			(60		)	(192		)	—			142
Cash flows from financing activities
Net borrowings (repayments) of debt	(10		)	959			68			(1,006		)	11
Other financing activities	18			34			(30		)	—			22
Net cash provided by (used in) financing activities	8			993			38			(1,006		)	33
Effect of exchange rate changes on cash and cash equivalents	—			—			(8		)	(2		)	(10		)
Decrease in cash and cash equivalents	(56		)	(28		)	(77		)	—			(161		)
Cash and cash equivalents at beginning of the period	336			72			347			—			755
Cash and cash equivalents at end of the period	$	280		$	44		$	270		$	—		$	594

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Summary of Significant Accounting Policies (Policies)

6 Months Ended

Apr. 30, 2015

Accounting Policies [Abstract]

Basis of Presentation and Consolidation

Basis of Presentation and Consolidation

The accompanying unaudited consolidated financial statements include the assets, liabilities, and results of operations of our Manufacturing operations, which include majority-owned dealers ("Dealcors"), and our Financial Services operations, including VIEs of which we are the primary beneficiary. The effects of transactions among consolidated entities have been eliminated to arrive at the consolidated amounts.

Certain reclassifications were made to prior period amounts to conform to the 2015 presentation, which relate to the realignment of our reporting segments that became effective during the first quarter of 2015. For more information, see Note 12, Segment Reporting.

We prepared the accompanying unaudited consolidated financial statements in accordance with United States ("U.S.") generally accepted accounting principles ("U.S. GAAP") for interim financial information and the instructions to the Quarterly Report on Form 10-Q and Article 10 of Regulation S-X issued by the U.S. Securities and Exchange Commission ("SEC"). Accordingly, they do not include all of the information and notes required by U.S. GAAP for comprehensive annual financial statements.

The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting policies described in our Annual Report on Form 10-K for the year ended October 31, 2014, which should be read in conjunction with the disclosures therein. In our opinion, these interim consolidated financial statements reflect all adjustments, consisting of normal recurring adjustments, necessary to present fairly the financial condition, results of operations, and cash flows for the periods presented. Operating results for interim periods are not necessarily indicative of annual operating results.

Variable Interest Entities

Variable Interest Entities

We have an interest in several VIEs, primarily joint ventures, established to manufacture or distribute products and enhance our operational capabilities. We have determined for certain of our VIEs that we are the primary beneficiary because we have the power to direct the activities of the VIE that most significantly impact its economic performance and we have the obligation to absorb losses of, or the right to receive benefits from, the VIE that could potentially be significant to the VIE. Accordingly, we include in our consolidated financial statements the assets and liabilities and results of operations of those entities, even though we may not own a majority voting interest. The liabilities recognized as a result of consolidating these VIEs do not represent additional claims on our general assets; rather they represent claims against the specific assets of these VIEs. Assets of these entities are not readily available to satisfy claims against our general assets.

We are the primary beneficiary of our Blue Diamond Parts ("BDP") and Blue Diamond Truck ("BDT") joint ventures with Ford. As a result, our Consolidated Balance Sheets include assets of $263 million and $297 million and liabilities of $238 million and $250 million as of April 30, 2015 and October 31, 2014, respectively, from BDP and BDT, including $87 million and $77 million of cash and cash equivalents, at the respective dates, which are not readily available to satisfy claims against our general assets. The creditors of BDP and BDT do not have recourse to our general credit. On May 29, 2015, we acquired Ford's remaining 25% ownership in BDT. The termination of the BDT joint venture did not have a material impact on our consolidated financial statements.

Our Financial Services segment consolidates several VIEs. As a result, our Consolidated Balance Sheets include secured assets of $1.2 billion and $1.1 billion as of April 30, 2015 and October 31, 2014, respectively, and liabilities of $923 million and $896 million as of April 30, 2015 and October 31, 2014, respectively, all of which are involved in securitizations that are treated as asset-backed debt. In addition, our Consolidated Balance Sheets include secured assets of $213 million and $156 million and

corresponding liabilities of $92 million and $54 million as of April 30, 2015 and October 31, 2014, respectively, which are related to other secured transactions that do not qualify for sale accounting treatment, and therefore, are treated as borrowings secured by operating and finance leases. Investors that hold securitization debt have a priority claim on the cash flows generated by their respective securitized assets to the extent that the related VIEs are required to make principal and interest payments. Investors in securitizations of these entities have no recourse to our general credit.

We also have an interest in other VIEs, which we do not consolidate because we are not the primary beneficiary. Our financial support and maximum loss exposure relating to these non-consolidated VIEs are not material to our financial condition, results of operations, or cash flows.

We use the equity method to account for our investments in entities that we do not control under the voting interest or variable interest models, but where we have the ability to exercise significant influence over operating and financial policies. Equity in income of non-consolidated affiliates includes our share of the net income of these entities.

Equity Method Investments, Policy [Policy Text Block]

We use the equity method to account for our investments in entities that we do not control under the voting interest or variable interest models, but where we have the ability to exercise significant influence over operating and financial policies. Equity in income of non-consolidated affiliates includes our share of the net income of these entities.

Product Warranty Liability

The following table presents accrued product warranty and deferred warranty revenue activity:

	Six Months Ended April 30,
(in millions)	2015			2014
Balance at beginning of period	$	1,197		$	1,349
Costs accrued and revenues deferred	116			153
Currency translation adjustment	(5		)	(1		)
Adjustments to pre-existing warranties(A)	(39		)	94
Payments and revenues recognized	(210		)	(272		)
Balance at end of period	1,059			1,323
Less: Current portion	496			626
Noncurrent accrued product warranty and deferred warranty revenue	$	563		$	697

_________________________

(A) Adjustments to pre-existing warranties reflect changes in our estimate of warranty costs for products sold in prior periods. Such adjustments typically occur when claims experience deviates from historic and expected trends. Our warranty liability is generally affected by component failure rates, repair costs, and the timing of failures. Future events and circumstances related to these factors could materially change our estimates and require adjustments to our liability. In addition, new product launches require a greater use of judgment in developing estimates until historical experience becomes available.

In the first quarter of 2015, we recognized a benefit for adjustments to pre-existing warranties of $57 million or a benefit of $0.70 per diluted share. Inthe first quarter of 2014, we recorded adjustments for changes in estimates of $52 million or charges of $0.64 per diluted share. In the second quarter of 2014, we recorded adjustments for changes in estimates of $42 million, or charges of $0.52 per diluted share. The impact of income taxes on the 2015 and 2014 adjustments are not material due to our deferred tax valuation allowances on our U.S. deferred tax assets.

Extended Warranty Programs

The amount of deferred revenue related to extended warranty programs was $425 million and $437 million at April 30, 2015 and October 31, 2014, respectively. Revenue recognized under our extended warranty programs was $38 million and $75 million, in the three and six months ended April 30, 2015, respectively, and $33 million and $60 million for the three and six months ended April 30, 2014, respectively.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses for the periods presented. Significant estimates and assumptions are used for, but are not limited to, pension and other postretirement benefits, allowance for doubtful accounts, income tax contingency accruals and valuation allowances, product warranty accruals, asbestos and other product liability accruals, asset impairment charges, and litigation-related accruals. Actual results could differ from our estimates.

Concentration Risks

Our financial condition, results of operations, and cash flows are subject to concentration risks related to concentrations of our union employees. As of April 30, 2015, approximately 6,200, or 73%, of our hourly workers and approximately 300, or 5%, of our salaried workers are represented by labor unions and are covered by collective bargaining agreements. On February 9, 2015, our United Automobile, Aerospace, and Agricultural Implement Workers of America ("UAW") represented employees ratified a new four-year labor agreement that replaced the prior contract that expired October 1, 2014. Our future operations may be affected by changes in governmental procurement policies, budget considerations, changing national defense requirements, and global, political, regulatory and economic developments in the U.S. and certain foreign countries (primarily Canada, Mexico, and Brazil).

Goodwill and Indefinite-Lived Intangible Assets

Goodwill represents the excess of the cost of an acquired business over the amounts assigned to the net assets. Goodwill is not amortized but is tested for impairment at a reporting unit level on an annual basis or more frequently, if circumstances change or an event occurs that would more likely than not reduce the fair value of a reporting unit below its carrying amount. Qualitative factors may be assessed to determine whether it is more likely than not that the fair value of the reporting unit is less than its carrying amount. If the qualitative assessment indicates that the carrying amount is more likely than not higher than the fair value, goodwill is tested for impairment based on a two-step test. The first step compares the fair value of a reporting unit with its carrying amount, including goodwill. If the fair value of a reporting unit exceeds its carrying amount, goodwill of the reporting unit is considered not impaired, thus the second step of the impairment test is unnecessary. If the carrying amount of a reporting unit exceeds its fair value, the second step of the goodwill impairment test shall be performed to measure the amount of impairment loss, if any. The second step compares the implied fair value of reporting unit goodwill with the carrying amount of that goodwill. If the carrying amount of reporting unit goodwill exceeds the implied fair value of that goodwill, an impairment loss shall be recognized in an amount equal to that excess.

Significant judgment is applied when goodwill is assessed for impairment. This judgment includes developing cash flow projections, selecting appropriate discount rates, identifying relevant market comparables, incorporating general economic and market conditions, and selecting an appropriate control premium. The income approach is based on discounted cash flows which are derived from internal forecasts and economic expectations for each respective reporting unit.

An intangible asset determined to have an indefinite useful life is not amortized until its useful life is determined to no longer be indefinite. Indefinite-lived intangible assets are evaluated each reporting period to determine whether events and circumstances continue to support an indefinite useful life. Indefinite-lived intangible assets are tested for impairment annually or more frequently if events or changes in circumstances indicate that the asset might be impaired. The impairment test consists of a comparison of the fair value of the indefinite-lived intangible asset with its carrying amount. If the carrying amount of an indefinite-lived intangible asset exceeds its fair value, an impairment loss is recognized in an amount equal to that excess.

Significant judgment is applied when evaluating if an intangible asset has a finite useful life. In addition, for indefinite-lived intangible assets, significant judgment is applied in testing for impairment. This judgment includes developing cash flow projections, selecting appropriate discount rates, identifying relevant market comparables, and incorporating general economic and market conditions. 

During the second quarter of 2014, the economic downturn in Brazil resulted in the continued decline in actual and forecasted results for the Brazilian engine reporting unit with goodwill of $142 million and an indefinite-lived intangible asset, trademark, of $43 million. As a result, we performed an impairment analysis in the second quarter of 2014 utilizing the income approach, based on discounted cash flows, which are derived from internal forecasts and economic expectations. It was determined that the carrying value of the Brazilian engine reporting unit, including goodwill, exceeded its fair value. As a result we compared the implied fair value of the reporting unit's goodwill with the carrying amount of that goodwill. A decrease in the enterprise value of the reporting unit coupled with appreciation in the value of certain tangible assets, which are not recognized for accounting purposes, resulted in the determination that the entire $142 million of goodwill was impaired. In addition, we determined that the related trademark was impaired and recognized an impairment charge of $7 million. The non-cash impairment charges were included in Asset impairment charges in the Company's Consolidated Statements of Operations. The Brazilian engine reporting unit is included in the Global Operations segment.

Recently Adopted Accounting Standards

In the six months ended April 30, 2015, the Company has not adopted any new accounting guidance that has had a material impact on our consolidated financial statements.

Recently Issued Accounting Standards

Use of Estimates, Policy [Policy Text Block]

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses for the periods presented. Significant estimates and assumptions are used for, but are not limited to, pension and other postretirement benefits, allowance for doubtful accounts, income tax contingency accruals and valuation allowances, product warranty accruals, asbestos and other product liability accruals, asset impairment charges, and litigation-related accruals. Actual results could differ from our estimates.

Concentration Risk Disclosure [Text Block]

Concentration Risks

Our financial condition, results of operations, and cash flows are subject to concentration risks related to concentrations of our union employees. As of April 30, 2015, approximately 6,200, or 73%, of our hourly workers and approximately 300, or 5%, of our salaried workers are represented by labor unions and are covered by collective bargaining agreements. On February 9, 2015, our United Automobile, Aerospace, and Agricultural Implement Workers of America ("UAW") represented employees ratified a new four-year labor agreement that replaced the prior contract that expired October 1, 2014. Our future operations may be affected by changes in governmental procurement policies, budget considerations, changing national defense requirements, and global, political, regulatory and economic developments in the U.S. and certain foreign countries (primarily Canada, Mexico, and Brazil).

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Segment Reporting - Summary of Segment Long Lived Assets and Revenue (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended
	Apr. 30, 2015	Apr. 30, 2014	Apr. 30, 2015	Apr. 30, 2014
Revenues from External Customers and Long-Lived Assets [Line Items]
Sales and revenues, net	$ 2,693	$ 2,746	$ 5,114	$ 4,954
Financial Services Operations [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Investment Income, Interest	44	42	89	82
Sales and revenues, net	$ 60	$ 57	$ 120	$ 112

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Consolidated Statements of Cash Flows (USD $) In Millions, unless otherwise specified	6 Months Ended
	Apr. 30, 2015	Apr. 30, 2014
Cash flows from operating activities
Net income (loss)	$ (90)	$ (525)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	118	122
Depreciation of equipment leased to others	35	63
Deferred taxes, including change in valuation allowance	(7)	(2)
Asset impairment charges	8	169
Amortization of debt issuance costs and discount	19	27
Stock-based compensation	8	12
Provision for doubtful accounts, net of recoveries	(3)	9
Equity in income of non-consolidated affiliates, net of dividends	5	7
Write off of Deferred Debt Issuance Cost	0	1
Other non-cash operating activities	(20)	(15)
Changes in other assets and liabilities, exclusive of the effects of businesses disposed	(310)	(194)
Net cash used in operating activities	(237)	(326)
Cash flows from investing activities
Purchases of marketable securities	(162)	(788)
Sales of marketable securities	431	902
Maturities of marketable securities	63	182
Net change in restricted cash and cash equivalents	53	(21)
Capital expenditures	(45)	(50)
Purchases of equipment leased to others	(20)	(108)
Proceeds from sales of property and equipment	5	20
Proceeds from Divestiture of Businesses and Interests in Affiliates	7	5
Net cash provided by investing activities	332	142
Cash flows from financing activities
Proceeds from issuance of securitized debt	250	152
Principal payments on securitized debt	(169)	(81)
Proceeds from issuance of non-securitized debt	84	473
Principal payments on non-securitized debt	(146)	(509)
Net increase in notes and debt outstanding under revolving credit facilities	5	3
Principal payments under financing arrangements and capital lease obligations	(1)	(14)
Debt issuance costs	(7)	(13)
Proceeds from financed lease obligations	20	34
Proceeds from exercise of stock options	1	18
Dividends paid by subsidiaries to non-controlling interest	(20)	(30)
Net cash provided by financing activities	17	33
Effect of exchange rate changes on cash and cash equivalents	(26)	(10)
Increase (decrease) in cash and cash equivalents	86	(161)
Cash and cash equivalents at beginning of the period	497	755
Cash and cash equivalents at end of the period	$ 583	$ 594

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Consolidated Statements of Comprehensive Loss (USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended
	Apr. 30, 2015	Apr. 30, 2014	Apr. 30, 2015	Apr. 30, 2014
Statement of Comprehensive Income [Abstract]
Net loss attributable to Navistar International Corporation	$ (64)	$ (297)	$ (106)	$ (545)
Other comprehensive income (loss):
Foreign currency translation adjustment	(27)	48	(86)	(14)
Defined benefit plans (net of tax of $0, $0, $(1), $(1), respectively)	33	25	65	50
Total other comprehensive income (loss)	6	73	(21)	36
Total comprehensive loss attributable to Navistar International Corporation	$ (58)	$ (224)	$ (127)	$ (509)

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Fair Value Measurements

6 Months Ended

Apr. 30, 2015

Fair Value Disclosures [Abstract]

Fair value measurements

Fair Value Measurements

For assets and liabilities measured at fair value on a recurring and nonrecurring basis, a three-level hierarchy of measurements based upon observable and unobservable inputs is used to arrive at fair value. Observable inputs are developed based on market data obtained from independent sources, while unobservable inputs reflect our assumptions about valuation based on the best information available in the circumstances. Depending on the inputs, we classify each fair value measurement as follows:

• Level 1—based upon quoted prices for identical instruments in active markets,

• Level 2—based upon quoted prices for similar instruments, prices for identical or similar instruments in markets that are not active, or model-derived valuations, all of whose significant inputs are observable, and

• Level 3—based upon one or more significant unobservable inputs.

The following section describes key inputs and assumptions in our valuation methodologies:

Cash Equivalents and Restricted Cash Equivalents—We classify highly liquid investments, with an original maturity of 90 days or less, including U.S. Treasury bills, federal agency securities, and commercial paper, as cash equivalents. The carrying amounts of cash and cash equivalents and restricted cash approximate fair value because of the short-term maturity and highly liquid nature of these instruments.

Marketable Securities—Our marketable securities portfolios are classified as available-for-sale and primarily include investments in U.S. government securities and commercial paper with an original maturity greater than 90 days. We use quoted prices from active markets to determine fair value.

Derivative Assets and Liabilities—We measure the fair value of derivatives assuming that the unit of account is an individual derivative transaction and that each derivative could be sold or transferred on a stand-alone basis. We classify within Level 2 our derivatives that are traded over-the-counter and valued using internal models based on observable market inputs. In certain cases, market data is not available and we estimate inputs such as in situations where trading in a particular commodity is not active. Measurements based upon these unobservable inputs are classified within Level 3. For more information regarding derivatives, see Note 10, Financial Instruments and Commodity Contracts.

Guarantees—We provide certain guarantees of payments and residual values to specific counterparties. Fair value of these guarantees is based upon internally developed models that utilize current market-based assumptions and historical data. We classify these liabilities within Level 3. For more information regarding guarantees, see Note 11, Commitments and Contingencies.

The following table presents the financial instruments measured at fair value on a recurring basis:

	April 30, 2015								October 31, 2014
(in millions)	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
Assets
Marketable securities:
U.S. Treasury bills	$	170	$	—	$	—	$	170	$	256	$	—	$	—	$	256
Other	103		—		—		103		349		—		—		349
Derivative financial instruments:
Interest rate caps(A)	—		1		—		1		—		1		—		1
Total assets	$	273	$	1	$	—	$	274	$	605	$	1	$	—	$	606
Liabilities
Derivative financial instruments:
Commodity forward contracts(B)	$	—	$	5	$	—	$	5	$	—	$	2	$	—	$	2
Foreign currency contracts(C)	—		1		—		1		—		—		—		—
Guarantees	—		—		7		7		—		—		8		8
Total liabilities	$	—	$	6	$	7	$	13	$	—	$	2	$	8	$	10

_________________________

(A) The asset value of interest rate caps are included in other noncurrent assets as of April 30, 2015 and October 31, 2014 in the accompanying Consolidated Balance Sheets.

(B) The liability value of commodity forward contracts are included in other noncurrent liabilities as of April 30, 2015 and October 31, 2014 in the accompanying Consolidated Balance Sheets.

(C) The liability value of foreign currency contracts are included in other noncurrent liabilities as of April 30, 2015 in the accompanying Consolidated Balance Sheets.

The following table presents the changes for those financial instruments classified within Level 3 of the valuation hierarchy:

	Three Months Ended April 30,
(in millions)	2015			2014
Guarantees, at February 1	$	(8	)	$	(6	)
Transfers out of Level 3	—			—
Issuances	—			—
Settlements	1			—
Guarantees, at April 30	$	(7	)	$	(6	)
Change in unrealized gains on assets and liabilities still held	$	—		$	—

	Six Months Ended April 30,
(in millions)	2015			2014
Guarantees, at November 1	$	(8	)	$	(6	)
Transfers out of Level 3	—			—
Issuances	—			—
Settlements	1			—
Guarantees, at April 30	$	(7	)	$	(6	)
Change in unrealized gains on assets and liabilities still held	$	—		$	—

The following table presents the financial instruments measured at fair value on a nonrecurring basis:

(in millions)	April 30, 2015			October 31, 2014
Level 2 financial instruments
Carrying value of impaired finance receivables (A)	$	20		$	20
Specific loss reserve	(9		)	(6		)
Fair value	$	11		$	14

_________________________

(A) Certain impaired finance receivables are measured at fair value on a nonrecurring basis. An impairment charge is recorded for the amount by which the carrying value of the receivables exceeds the fair value of the underlying collateral, net of remarketing costs. Fair values of the underlying collateral are determined by reference to dealer vehicle value publications adjusted for certain market factors.

In the second quarter of 2014, for the purpose of impairment evaluation the Company measured the implied fair value of the Company's Brazilian engine reporting unit's goodwill and the fair value of an indefinite-lived intangible asset, trademark. The Company's Brazilian engine reporting unit's goodwill was determined to be fully impaired and resulted in a non-cash charge of $142 million. In addition, the related trademark, with a carrying value of $43 million was determined to be impaired and a non-cash charge of $7 million was recognized. The impairment charges were included in Asset impairment charges in the Company's Consolidated Statements of Operations. We utilized the income approach to determine the fair value of these Level 3 assets. For more information, see Note 1, Summary of Significant Accounting Policies.

In the first quarter of 2014, the Company concluded it had a triggering event related to potential sales of assets requiring assessment of impairment for certain intangible and long-lived assets in the Truck segment. As a result, certain amortizing intangible assets and long-lived assets with a carrying value of $18 million were determined to be fully impaired, resulting in an impairment charge of $18 million, which was included in Asset impairment charges in the Company's Consolidated Statements of Operations. We utilized the market approach to determine the fair values of these Level 2 assets.

In addition to the methods and assumptions we use for the financial instruments recorded at fair value as discussed above, we use the following methods and assumptions to estimate the fair value for our other financial instruments that are not marked to market on a recurring basis. The carrying amounts of Cash and cash equivalents, Restricted cash, and Accounts payable approximate fair values because of the short-term maturity and highly liquid nature of these instruments. Finance receivables generally consist of retail and wholesale accounts and retail and wholesale notes. The carrying amounts of Trade and other receivables and retail and wholesale accounts approximate fair values as a result of the short-term nature of the receivables. The carrying amounts of wholesale notes approximate fair values as a result of the short-term nature of the wholesale notes and their variable interest rate terms. The fair values of these financial instruments are classified as Level 1. Due to the nature of the aforementioned financial instruments, they have been excluded from the fair value amounts presented in the table below.

The fair values of our retail notes are estimated by discounting expected cash flows at estimated current market rates. The fair values of our retail notes are classified as Level 3 financial instruments.

The fair values of our debt instruments classified as Level 1 were determined using quoted market prices. The 6.5% Tax Exempt Bonds, due 2040, are traded, but the trading market is illiquid, and as a result, the Loan Agreement underlying the Tax Exempt Bonds is classified as Level 2. The fair values of our Level 3 debt instruments are generally determined using internally developed valuation techniques such as discounted cash flow modeling. Inputs such as discount rates and credit spreads reflect our estimates of assumptions that market participants would use in pricing the instrument and may be unobservable.

The following tables present the carrying values and estimated fair values of financial instruments:

	As of April 30, 2015
	Estimated Fair Value								Carrying Value
(in millions)	Level 1		Level 2		Level 3		Total
Assets
Retail notes	$	—	$	—	$	209	$	209	$	208
Notes receivable	—		—		5		5		5
Liabilities
Debt:
Manufacturing operations
Senior Secured Term Loan Credit Facility, as Amended, due 2017	—		—		719		719		694
8.25% Senior Notes, due 2021	1,233		—		—		1,233		1,181
4.50% Senior Subordinated Convertible Notes, due 2018(A)	—		—		185		185		183
4.75% Senior Subordinated Convertible Notes, due 2019(A)	—		—		383		383		375
Debt of majority-owned dealerships	—		—		28		28		28
Financing arrangements	—		—		21		21		45
Loan Agreement related to 6.50% Tax Exempt Bonds, due 2040	—		243		—		243		225
Promissory Note	—		—		5		5		5
Financed lease obligations	—		—		141		141		141
Other	—		—		24		24		24
Financial Services operations
Asset-backed debt issued by consolidated SPEs, at various rates, due serially through 2018	—		—		984		984		986
Bank revolvers, at fixed and variable rates, due dates from 2015 through 2020	—		—		1,184		1,184		1,205
Commercial paper, at variable rates, program matures in 2017	77		—		—		77		77
Borrowings secured by operating and finance leases, at various rates, due serially through 2018	—		—		29		29		29

	As of October 31, 2014
	Estimated Fair Value								Carrying Value
(in millions)	Level 1		Level 2		Level 3		Total
Assets
Retail notes	$	—	$	—	$	279	$	279	$	275
Notes receivable	—		—		7		7		8
Liabilities
Debt:
Manufacturing operations
Senior Secured Term Loan Credit Facility, as Amended, due 2017	—		—		704		704		694
8.25% Senior Notes, due 2021	1,285		—		—		1,285		1,180
4.50% Senior Subordinated Convertible Notes, due 2018(A)	—		—		196		196		181
4.75% Senior Subordinated Convertible Notes, due 2019(A)	—		—		413		413		371
Debt of majority-owned dealerships	—		—		30		30		30
Financing arrangements	—		—		22		22		48
Loan Agreement related to 6.50% Tax Exempt Bonds, due 2040	—		232		—		232		225
Promissory Note	—		—		10		10		10
Financed lease obligations	—		—		184		184		184
Other	—		—		28		28		29
Financial Services operations
Asset-backed debt issued by consolidated SPEs, at various rates, due serially through 2019	—		—		911		911		914
Bank revolvers, at fixed and variable rates, due dates from 2014 through 2020	—		—		1,214		1,214		1,242
Commercial paper, at variable rates, program matures in 2015	74		—		—		74		74
Borrowings secured by operating and finance leases, at various rates, due serially through 2018	—		—		36		36		36

_________________________

(A) The carrying value represents the consolidated financial statement amount of the debt which excludes the allocation of the conversion feature to equity, while the fair value is based on internally developed valuation techniques such as discounted cash flow modeling for Level 3 convertible notes which include the equity feature.

XML

Document and Entity Information Document	6 Months Ended
	Apr. 30, 2015	May 31, 2015
Document and Entity Information [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Apr. 30, 2015
Document Fiscal Year Focus	2015
Document Fiscal Period Focus	Q2
Trading Symbol	nav
Entity Registrant Name	NAVISTAR INTERNATIONAL CORP
Entity Central Index Key	0000808450
Current Fiscal Year End Date	--10-31
Entity Well-known Seasoned Issuer	Yes
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		81,500,808

XML

Financial Instruments and Commodity Contracts

6 Months Ended

Apr. 30, 2015

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Financial Instruments and Commodity Contracts

Financial Instruments and Commodity Contracts

Derivative Financial Instruments

We use derivative financial instruments as part of our overall interest rate, foreign currency, and commodity risk management strategies to reduce our interest rate exposure, reduce exchange rate risk for transactional exposures denominated in currencies other than the functional currency, and minimize the effect of commodity price volatility. From time to time, we use foreign currency forward and option contracts to manage the risk of exchange rate movements that would affect the value of our foreign currency cash flows. Foreign currency exchange rate movements create a degree of risk by affecting the value of sales made and costs incurred in currencies other than the functional currency. In addition, we also use commodity forward contracts to manage our exposure to variability in certain commodity prices.

We generally do not enter into derivative financial instruments for speculative or trading purposes and did not during the three and six months ended April 30, 2015 and 2014. None of our derivatives qualified for hedge accounting treatment during the three and six months ended April 30, 2015 and 2014.

The majority of our derivative contracts are transacted under International Swaps and Derivatives Association ("ISDA") master agreements. Each agreement permits the net settlement of amounts owed in the event of default or certain other termination events. For derivative financial instruments, we have elected not to offset derivative positions in the balance sheet with the same counterparty under the same agreement. Certain of our derivative contracts contain provisions that require us to provide collateral if certain thresholds are exceeded. Collateral of $1 million was provided at April 30, 2015 and no collateral was provided as of October 31, 2014. Collateral is generally not required to be provided by our counter-parties for derivative contracts. We manage exposure to counter-party credit risk by entering into derivative financial instruments with various major financial institutions that can be expected to fully perform under the terms of such instruments. We do not anticipate nonperformance by any of the counter-parties. Our exposure to credit risk in the event of nonperformance by the counter-parties

is limited to those assets that have been recorded, but have not yet been received in cash. We had $1 million exposure to the credit risk of others at both April 30, 2015 and October 31, 2014.

	Location in Consolidated Statements of Operations	Three Months Ended April 30,
(in millions)		2015			2014
Interest rate caps	Interest expense	$	—		$	2
Cross currency swaps	Other (income) expense, net	1			(1		)
Foreign currency contracts	Other (income) expense, net	—			1
Commodity forward contracts	Costs of products sold	(5		)	—
Total (income) loss		$	(4	)	$	2

	Location in Consolidated Statements of Operations	Six Months Ended April 30,
(in millions)		2015		2014
Interest rate caps	Interest expense	$	—	$	1
Cross currency swaps	Other (income) expense, net	3		1
Foreign currency contracts	Other (income) expense, net	1		—
Commodity forward contracts	Costs of products sold	5		—
Total loss		$	9	$	2

Foreign Currency Contracts

During 2015 and 2014, we entered into foreign exchange forward and option contracts as economic hedges of anticipated cash flows denominated in Brazilian Reais, Euros, Canadian Dollars, and Mexican Pesos. All contracts were entered into to protect against the risk that the eventual cash flows resulting from certain transactions would be affected by changes in exchange rates between the U.S. Dollar and the respective foreign currency.

The following table presents the outstanding foreign currency contracts as of April 30, 2015 and October 31, 2014:

(in millions)	Currency	Notional Amount		Maturity
As of April 30, 2015
Forward exchange contract	EUR	€	6	May 2015
Forward exchange contract	EUR	€	5	June 2015
Forward exchange contract	EUR	€	5	July 2015
Forward exchange contract	EUR	€	6	August 2015-October 2015(A)
Forward exchange contract	CAD	C$	25	May 2015
Forward exchange contract	CAD	C$	25	June 2015
Forward exchange contract	CAD	C$	25	July 2015
Forward exchange contract	CAD	C$	75	August 2015-October 2015(B)
Forward exchange contract	MXN	₱	763	May 2015
As of October 31, 2014
Forward exchange contract	EUR	€	4	November 2014
Forward exchange contract	EUR	€	4	December 2014
Forward exchange contract	EUR	€	5	January 2015
Forward exchange contract	EUR	€	9	February 2015 - October 2015(C)

_________________________

(A) Forward exchange contracts of €2 million expire on the last day of each month from August 2015 through October 2015.

(B) Forward exchange contracts of C$25 million expire on the last day of each month from August 2015 through October 2015.

(C) Forward exchange contracts of €1 million expire on the last day of each month from February 2015 through October 2015.

Commodity Forward Contracts

During 2015 and 2014, we entered into commodity forward contracts as economic hedges of our exposure to variability in commodity prices for diesel fuel and steel. As of April 30, 2015, we had outstanding diesel fuel contracts with aggregate notional values of $17 million and outstanding steel contracts with aggregate notional values of $11 million. The commodity forward contracts have maturity dates ranging from April 30, 2015 to October 31, 2015. As of October 31, 2014, we had outstanding diesel fuel contracts with aggregate notional values of $24 million and outstanding steel contracts with aggregate notional values of $23 million. All of these contracts were entered into to protect against the risk that the eventual cash flows related to purchases of the commodities will be affected by changes in prices.

Interest-Rate Contracts

From time to time, we enter into various interest-rate contracts, interest rate caps, and cross currency swaps. As of April 30, 2015, there were no outstanding cross currency swaps. As of October 31, 2014, the notional amount of our outstanding cross currency swaps was $27 million. We are exposed to interest rate and exchange rate risk as a result of our borrowing activities. The objective of these contracts is to mitigate fluctuations in earnings, cash flows, and fair value of borrowings. Our Mexican financial services operation uses interest rate caps and cross currency swaps to protect against the potential of rising interest rates as required by the terms of its variable-rate asset-backed securities and fluctuations in the value of the peso, as required under Mexican bank credit facilities. As of April 30, 2015 and October 31, 2014, the notional amount of our outstanding interest rate caps was $118 million and $134 million, respectively.

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Consolidated Statements of Comprehensive Loss (Parenthetical) (USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended
	Apr. 30, 2015	Apr. 30, 2014	Apr. 30, 2015	Apr. 30, 2014
Statement of Comprehensive Income [Abstract]
Defined benefit plan, tax	$ 0	$ 0	$ (1)	$ (1)

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Allowance for Doubtful Accounts

6 Months Ended

Apr. 30, 2015

Allowance for Doubtful Accounts [Abstract]

Allowance for Doubtful Accounts

Allowance for Doubtful Accounts

Our two finance receivables portfolio segments, retail and wholesale, each consist of one class of receivable based on: (i) initial measurement attributes of the receivables, and (ii) the assessment and monitoring of risk and performance of the receivables. For more information, see Note 3, Finance Receivables.

The following tables present the activity related to our allowance for doubtful accounts for our retail portfolio segment, wholesale portfolio segment, and trade and other receivables:

	Three Months Ended April 30, 2015											Three Months Ended April 30, 2014
(in millions)	Retail Portfolio			Wholesale Portfolio		Trade and Other Receivables			Total			Retail Portfolio			Wholesale Portfolio		Trade and Other Receivables			Total
Allowance for doubtful accounts, at beginning of period	$	23		$	3	$	32		$	58		$	22		$	2	$	36		$	60
Provision for doubtful accounts, net of recoveries	3			—		—			3			3			—		1			4
Charge-off of accounts(A)	—			—		—			—			(3		)	—		(2		)	(5		)
Other(B)	(1		)	—		(2		)	(3		)	—			—		3			3
Allowance for doubtful accounts, at end of period	$	25		$	3	$	30		$	58		$	22		$	2	$	38		$	62

	Six Months Ended April 30, 2015											Six Months Ended April 30, 2014
(in millions)	Retail Portfolio			Wholesale Portfolio		Trade and Other Receivables			Total			Retail Portfolio			Wholesale Portfolio		Trade and Other Receivables			Total
Allowance for doubtful accounts, at beginning of period	$	24		$	3	$	38		$	65		$	21		$	2	$	37		$	60
Provision for doubtful accounts, net of recoveries	5			—		—			5			7			—		3			10
Charge-off of accounts(A)	(1		)	—		(3		)	(4		)	(5		)	—		(2		)	(7		)
Other(B)	(3		)	—		(5		)	(8		)	(1		)	—		—			(1		)
Allowance for doubtful accounts, at end of period	$	25		$	3	$	30		$	58		$	22		$	2	$	38		$	62

________________________

(A) We repossess sold and leased vehicles on defaulted finance receivables and leases, and place them into Inventories. Losses recognized at the time of repossession and charged against the allowance for doubtful accounts were both less than $1 million, for the three and six months ended April 30, 2015, as well as for the three and six months ended April 30, 2014.

(B) Amounts include currency translation.

The accrual of interest income is discontinued on certain impaired finance receivables. Impaired finance receivables include accounts with specific loss reserves and certain accounts that are on non-accrual status. In certain cases, we continue to collect payments on our impaired finance receivables.

The following table presents information regarding impaired finance receivables:

	April 30, 2015						October 31, 2014
(in millions)	Retail Portfolio		Wholesale Portfolio		Total		Retail Portfolio		Wholesale Portfolio		Total
Impaired finance receivables with specific loss reserves	$	20	$	—	$	20	$	20	$	—	$	20
Impaired finance receivables without specific loss reserves	7		—		7		1		—		1
Specific loss reserves on impaired finance receivables	9		—		9		6		—		6
Finance receivables on non-accrual status	27		—		27		21		—		21

For the impaired finance receivables in the retail portfolio as of April 30, 2015 and 2014, the average balances of those receivables were $25 million and $16 million during the six months ended April 30, 2015 and 2014, respectively.

The Company uses the aging of its receivables as well as other inputs when assessing credit quality. The following table presents the aging analysis for finance receivables:

	April 30, 2015						October 31, 2014
(in millions)	Retail Portfolio		Wholesale Portfolio		Total		Retail Portfolio		Wholesale Portfolio		Total
Current, and up to 30 days past due	$	586	$	1,515	$	2,101	$	643	$	1,333	$	1,976
30-90 days past due	57		—		57		64		2		66
Over 90 days past due	24		—		24		19		4		23
Total finance receivables	$	667	$	1,515	$	2,182	$	726	$	1,339	$	2,065

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Finance Receivables

6 Months Ended

Apr. 30, 2015

Receivables [Abstract]

Finance Receivables

Finance Receivables

Finance receivables are receivables of our Financial Services operations. Finance receivables generally consist of wholesale notes and accounts, as well as retail notes, finance leases and accounts. Total finance receivables reported on the Consolidated Balance Sheets are net of an allowance for doubtful accounts. Total assets of our Financial Services operations net of intercompany balances were $2.6 billion as of both April 30, 2015 and October 31, 2014. Included in total assets of our Financial Services operations are finance receivables of $2.2 billion and $2.0 billion as of April 30, 2015 and October 31, 2014, respectively. We have two portfolio segments of finance receivables based on the type of financing inherent to each portfolio. The retail portfolio segment represents loans or leases to end-users for the purchase or lease of vehicles. The wholesale portfolio segment represents loans to dealers to finance their inventory.

Our Finance receivables, net consist of the following:

(in millions)	April 30, 2015		October 31, 2014
Retail portfolio	$	667	$	726
Wholesale portfolio	1,515		1,339
Total finance receivables	2,182		2,065
Less: Allowance for doubtful accounts	28		27
Total finance receivables, net	2,154		2,038
Less: Current portion, net(A)	1,929		1,758
Noncurrent portion, net	$	225	$	280

_________________________

(A) The current portion of finance receivables is computed based on contractual maturities. Actual cash collections typically vary from the contractual cash flows because of prepayments, extensions, delinquencies, credit losses, and renewals.

Securitizations

Our Financial Services operations transfers wholesale notes, retail accounts receivable, retail notes, finance leases, and operating leases through special purpose entities ("SPEs"), which generally are only permitted to purchase these assets, issue asset-backed securities, and make payments on the securities. In addition to servicing receivables, our continued involvement in the SPEs may include an economic interest in the transferred receivables and, in some cases, managing exposure to interest rates using interest rate swaps and interest rate caps. There were no transfers of finance receivables that qualified for sale accounting treatment as of April 30, 2015 and October 31, 2014, and as a result, the transferred finance receivables are included in our Consolidated Balance Sheets and the related interest earned is included in Finance revenues.

We transfer eligible finance receivables into retail note owner trusts or wholesale note owner trusts in order to issue asset-backed securities. These trusts are VIEs of which we are determined to be the primary beneficiary and, therefore, the assets and liabilities of the trusts are included in our Consolidated Balance Sheets. The outstanding balance of finance receivables transferred into these VIEs was $1.1 billion and $996 million as of April 30, 2015 and October 31, 2014, respectively. Other finance receivables related to secured transactions that do not qualify for sale accounting treatment were $149 million and $93 million as of April 30, 2015 and October 31, 2014, respectively. For more information on assets and liabilities of consolidated VIEs and other securitizations accounted for as secured borrowings by our Financial Services segment, see Note 1, Summary of Significant Accounting Policies.

Finance Revenues

The following table presents the components of our Finance revenues:

	Three Months Ended April 30,						Six Months Ended April 30,
(in millions)	2015			2014			2015			2014
Retail notes and finance leases revenue	$	12		$	16		$	25		$	33
Wholesale notes interest	24			19			48			37
Operating lease revenue	15			15			30			29
Retail and wholesale accounts interest	9			7			17			13
Gross finance revenues	60			57			120			112
Less: Intercompany revenues	(25		)	(19		)	(49		)	(35		)
Finance revenues	$	35		$	38		$	71		$	77

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Condensed Consolidating Guarantor and Non-Guarantor Financial Information

6 Months Ended

Apr. 30, 2015

Condensed Consolidating Guarantor and Non-Guarantor [Abstract]

Condensed Consolidating Guarantor and Non-guarantor Financial Information

Consolidating Guarantor and Non-guarantor Financial Information

The following tables set forth condensed consolidating balance sheets as of April 30, 2015 and October 31, 2014, and condensed consolidating statements of operations and condensed consolidating statements of comprehensive income (loss) for the three and six months ended April 30, 2015 and 2014, and condensed consolidating statements of cash flows for the six months ended April 30, 2015 and 2014.

The information is presented as a result of Navistar, Inc.’s guarantee, exclusive of its subsidiaries, of NIC’s indebtedness under our 8.25% Senior Notes, due 2021, and obligations under our Loan Agreement related to the 6.5% Tax Exempt Bonds, due 2040. Navistar, Inc. is a direct wholly-owned subsidiary of NIC. None of NIC’s other subsidiaries guarantee any of these notes or bonds. The guarantees are "full and unconditional", as those terms are used in Regulation S-X Rule 3-10, except that the guarantees will be automatically released in certain customary circumstances, such as when the subsidiary is sold or all of the assets of the subsidiary are sold, the capital stock is sold, when the subsidiary is designated as an "unrestricted subsidiary" for purposes of the respective indenture for each of the 8.25% Senior Notes, due 2021, and the 6.5% Tax Exempt Bonds, due 2040, upon liquidation or dissolution of the subsidiary or upon legal or covenant defeasance, or satisfaction and discharge of the notes or bonds. Separate financial statements and other disclosures concerning Navistar, Inc. have not been presented because management believes that such information is not material to investors. Within this disclosure only, "NIC" includes the financial results of the parent company only, with all of its wholly-owned subsidiaries accounted for under the equity method. Likewise, "Navistar, Inc.," for purposes of this disclosure only, includes the consolidated financial results of its wholly-owned subsidiaries accounted for under the equity method and its operating units accounted for on a consolidated basis. "Non-Guarantor Subsidiaries" includes the combined financial results of all other non-guarantor subsidiaries. "Eliminations and Other" includes all eliminations and reclassifications to reconcile to the consolidated financial statements. NIC files a consolidated U.S. federal income tax return that includes Navistar, Inc. and its U.S. subsidiaries. Navistar, Inc. has a tax allocation agreement ("Tax Agreement") with NIC which requires Navistar, Inc. to compute its separate federal income tax liability and remit any resulting tax liability to NIC. Tax benefits that may arise from net operating losses of Navistar, Inc. are not refunded to Navistar, Inc. but may be used to offset future required tax payments under the Tax Agreement. The effect of the Tax Agreement is to allow NIC, the parent company, rather than Navistar, Inc., to utilize current U.S. taxable losses of Navistar, Inc. and all other direct or indirect subsidiaries of NIC.

Condensed Consolidating Statement of Operations for the Three Months Ended April 30, 2015
(in millions)	NIC			Navistar, Inc.			Non-Guarantor Subsidiaries			Eliminations and Other			Consolidated
Sales and revenues, net	$	—		$	2,009		$	1,943		$	(1,259	)	$	2,693
Costs of products sold	—			1,864			1,735			(1,239		)	2,360
Restructuring charges	—			—			6			—			6
Asset impairment charges	—			1			—			—			1
All other operating expenses (income)	27			282			79			(22		)	366
Total costs and expenses	27			2,147			1,820			(1,261		)	2,733
Equity in income (loss) of affiliates	(37		)	64			—			(26		)	1
Income (loss) before income taxes	(64		)	(74		)	123			(24		)	(39		)
Income tax expense	—			(1		)	(17		)	—			(18		)
Earnings (loss) from continuing operations	(64		)	(75		)	106			(24		)	(57		)
Income from discontinued operations, net of tax	—			—			—			—			—
Net income (loss)	(64		)	(75		)	106			(24		)	(57		)
Less: Net income attributable to non-controlling interests	—			—			7			—			7
Net income (loss) attributable to Navistar International Corporation	$	(64	)	$	(75	)	$	99		$	(24	)	$	(64	)

Condensed Consolidating Statement of Comprehensive Income (Loss) for the Three Months Ended April 30, 2015
(in millions)	NIC			Navistar, Inc.			Non-Guarantor Subsidiaries			Eliminations and Other			Consolidated
Net income (loss) attributable to Navistar International Corporation	$	(64	)	$	(75	)	$	99		$	(24	)	$	(64	)
Other comprehensive income (loss):
Foreign currency translation adjustment	(27		)	—			(27		)	27			(27		)
Defined benefit plans (net of tax of $(0), for all entities)	33			31			2			(33		)	33
Total other comprehensive income (loss)	6			31			(25		)	(6		)	6
Total comprehensive income (loss) attributable to Navistar International Corporation	$	(58	)	$	(44	)	$	74		$	(30	)	$	(58	)

Condensed Consolidating Statement of Operations for the Six Months Ended April 30, 2015
(in millions)	NIC			Navistar, Inc.			Non-Guarantor Subsidiaries			Eliminations and Other			Consolidated
Sales and revenues, net	$	—		$	3,619		$	3,711		$	(2,216	)	$	5,114
Costs of products sold	—			3,273			3,305			(2,173		)	4,405
Restructuring charges	—			3			6			—			9
Asset impairment charges	—			8			—			—			8
All other operating expenses (income)	50			546			204			(40		)	760
Total costs and expenses	50			3,830			3,515			(2,213		)	5,182
Equity in income (loss) of affiliates	(56		)	79			1			(21		)	3
Income (loss) before income taxes	(106		)	(132		)	197			(24		)	(65		)
Income tax expense	—			(2		)	(23		)	—			(25		)
Earnings (loss) from continuing operations	(106		)	(134		)	174			(24		)	(90		)
Income from discontinued operations, net of tax	—			—			—			—			—
Net income (loss)	(106		)	(134		)	174			(24		)	(90		)
Less: Net income attributable to non-controlling interests	—			—			16			—			16
Net income (loss) attributable to Navistar International Corporation	$	(106	)	$	(134	)	$	158		$	(24	)	$	(106	)

Condensed Consolidating Statement of Comprehensive Income (Loss) for the Six Months Ended April 30, 2015
(in millions)	NIC			Navistar, Inc.			Non-Guarantor Subsidiaries			Eliminations and Other			Consolidated
Net income (loss) attributable to Navistar International Corporation	$	(106	)	$	(134	)	$	158		$	(24	)	$	(106	)
Other comprehensive income (loss):
Foreign currency translation adjustment	(86		)	—			(86		)	86			(86		)
Defined benefit plans (net of tax of $(1), $(0), $(1), $1, and $(1), respectively)	65			62			3			(65		)	65
Total other comprehensive income (loss)	(21		)	62			(83		)	21			(21		)
Total comprehensive income (loss) attributable to Navistar International Corporation	$	(127	)	$	(72	)	$	75		$	(3	)	$	(127	)

Condensed Consolidating Balance Sheet as of April 30, 2015
(in millions)	NIC			Navistar, Inc.			Non-Guarantor Subsidiaries			Eliminations and Other			Consolidated
Assets
Cash and cash equivalents	$	163		$	37		$	383		$	—		$	583
Marketable securities	150			—			123			—			273
Restricted cash	17			6			90			—			113
Finance and other receivables, net	3			132			2,558			(19		)	2,674
Inventories	—			785			475			(15		)	1,245
Investments in non-consolidated affiliates	(7,322		)	6,495			65			830			68
Property and equipment, net	—			768			646			(7		)	1,407
Goodwill	—			—			38			—			38
Deferred taxes, net	5			9			158			—			172
Other	32			141			179			—			352
Total assets	$	(6,952	)	$	8,373		$	4,715		$	789		$	6,925
Liabilities and stockholders’ equity (deficit)
Debt	$	1,965		$	887		$	2,357		$	(6	)	$	5,203
Postretirement benefits liabilities	—			2,639			227			—			2,866
Amounts due to (from) affiliates	(7,749		)	11,963			(4,352		)	138			—
Other liabilities	3,606			249			(182		)	(73		)	3,600
Total liabilities	(2,178		)	15,738			(1,950		)	59			11,669
Redeemable equity securities	1			—			—			—			1
Stockholders’ equity attributable to non-controlling interest	—			—			30			—			30
Stockholders’ equity (deficit) attributable to Navistar International Corporation	(4,775		)	(7,365		)	6,635			730			(4,775		)
Total liabilities and stockholders’ equity (deficit)	$	(6,952	)	$	8,373		$	4,715		$	789		$	6,925

Condensed Consolidating Statement of Cash Flows for the Six Months Ended April 30, 2015
(in millions)	NIC			Navistar, Inc.			Non-Guarantor Subsidiaries			Eliminations and Other			Consolidated
Net cash provided by (used in) operations	$	(168	)	$	41		$	(188	)	$	78		$	(237	)
Cash flows from investment activities
Net change in restricted cash and cash equivalents	1			(2		)	54			—			53
Net sales of marketable securities	229			—			103			—			332
Capital expenditures and purchase of equipment leased to others	—			(30		)	(35		)	—			(65		)
Other investing activities	—			7			5			—			12
Net cash provided by (used in) investment activities	230			(25		)	127			—			332
Cash flows from financing activities
Net borrowings (repayments) of debt	—			(52		)	66			2			16
Other financing activities	—			20			61			(80		)	1
Net cash provided by (used in) financing activities	—			(32		)	127			(78		)	17
Effect of exchange rate changes on cash and cash equivalents	—			—			(26		)	—			(26		)
Increase (decrease) in cash and cash equivalents	62			(16		)	40			—			86
Cash and cash equivalents at beginning of the period	101			53			343			—			497
Cash and cash equivalents at end of the period	$	163		$	37		$	383		$	—		$	583

Condensed Consolidating Statement of Operations for the Three Months Ended April 30, 2014
(in millions)	NIC			Navistar, Inc.			Non-Guarantor Subsidiaries			Eliminations and Other			Consolidated
Sales and revenues, net	$	—		$	1,893		$	2,061		$	(1,208	)	$	2,746
Costs of products sold	—			1,797			1,862			(1,191		)	2,468
Restructuring charges	—			8			—			—			8
Asset impairment charges	—			—			153			(2		)	151
All other operating expenses (income)	41			273			89			(17		)	386
Total costs and expenses	41			2,078			2,104			(1,210		)	3,013
Equity in income (loss) of affiliates	(269		)	(141		)	2			411			3
Income (loss) before income taxes	(310		)	(326		)	(41		)	413			(264		)
Income tax benefit (expense)	13			(8		)	(28		)	—			(23		)
Earnings (loss) from continuing operations	(297		)	(334		)	(69		)	413			(287		)
Income from discontinued operations, net of tax	—			—			1			—			1
Net income (loss)	(297		)	(334		)	(68		)	413			(286		)
Less: Net income attributable to non-controlling interests	—			—			11			—			11
Net income (loss) attributable to Navistar International Corporation	$	(297	)	$	(334	)	$	(79	)	$	413		$	(297	)

Condensed Consolidating Statement of Comprehensive Income (Loss) for the Three Months Ended April 30, 2014
(in millions)	NIC			Navistar, Inc.			Non-Guarantor Subsidiaries			Eliminations and Other			Consolidated
Net income (loss) attributable to Navistar International Corporation	$	(297	)	$	(334	)	$	(79	)	$	413		$	(297	)
Other comprehensive income (loss):
Foreign currency translation adjustment	48			—			48			(48		)	48
Defined benefit plans (net of tax of $0, for all entities)	25			25			—			(25		)	25
Total other comprehensive income (loss)	73			25			48			(73		)	73
Total comprehensive income (loss) attributable to Navistar International Corporation	$	(224	)	$	(309	)	$	(31	)	$	340		$	(224	)

Condensed Consolidating Statement of Operations for the Six Months Ended April 30, 2014
(in millions)	NIC			Navistar, Inc.			Non-Guarantor Subsidiaries			Eliminations and Other			Consolidated
Sales and revenues, net	$	—		$	3,317		$	3,790		$	(2,153	)	$	4,954
Costs of products sold	—			3,222			3,393			(2,133		)	4,482
Restructuring charges	—			10			1			—			11
Asset impairment charges	—			—			171			(2		)	169
All other operating expenses (income)	77			514			248			(28		)	811
Total costs and expenses	77			3,746			3,813			(2,163		)	5,473
Equity in income (loss) of affiliates	(481		)	(152		)	1			635			3
Income (loss) before income taxes	(558		)	(581		)	(22		)	645			(516		)
Income tax benefit (expense)	13			(1		)	(23		)	—			(11		)
Earnings (loss) from continuing operations	(545		)	(582		)	(45		)	645			(527		)
Income from discontinued operations, net of tax	—			—			2			—			2
Net income (loss)	(545		)	(582		)	(43		)	645			(525		)
Less: Net income attributable to non-controlling interests	—			—			20			—			20
Net income (loss) attributable to Navistar International Corporation	$	(545	)	$	(582	)	$	(63	)	$	645		$	(545	)

Condensed Consolidating Statement of Comprehensive Income (Loss) for the Six Months Ended April 30, 2014
(in millions)	NIC			Navistar, Inc.			Non-Guarantor Subsidiaries			Eliminations and Other			Consolidated
Net income (loss) attributable to Navistar International Corporation	$	(545	)	$	(582	)	$	(63	)	$	645		$	(545	)
Other comprehensive income (loss):
Foreign currency translation adjustment	(14		)	—			(14		)	14			(14		)
Defined benefit plans (net of tax of $(1) $0, $(1), $1, and $(1), respectively)	50			50			—			(50		)	50
Total other comprehensive income (loss)	36			50			(14		)	(36		)	36
Total comprehensive income (loss) attributable to Navistar International Corporation	$	(509	)	$	(532	)	$	(77	)	$	609		$	(509	)

Condensed Consolidating Balance Sheet as of October 31, 2014
(in millions)	NIC			Navistar, Inc.			Non-Guarantor Subsidiaries			Eliminations and Other			Consolidated
Assets
Cash and cash equivalents	$	101		$	53		$	343		$	—		$	497
Marketable securities	379			—			226			—			605
Restricted cash	19			4			148			—			171
Finance and other receivables, net	—			124			2,504			(12		)	2,616
Inventories	—			792			539			(12		)	1,319
Investments in non-consolidated affiliates	(7,245		)	6,410			71			837			73
Property and equipment, net	—			827			740			(5		)	1,562
Goodwill	—			—			38			—			38
Deferred taxes, net	5			9			185			1			200
Other	34			137			194			(3		)	362
Total assets	$	(6,707	)	$	8,356		$	4,988		$	806		$	7,443
Liabilities and stockholders’ equity (deficit)
Debt	$	1,958		$	937		$	2,336		$	(7	)	$	5,224
Postretirement benefits liabilities	—			2,712			243			—			2,955
Amounts due to (from) affiliates	(7,618		)	11,739			(4,267		)	146			—
Other liabilities	3,605			370			(22		)	(71		)	3,882
Total liabilities	(2,055		)	15,758			(1,710		)	68			12,061
Redeemable equity securities	2			—			—			—			2
Stockholders’ equity attributable to non-controlling interest	—			—			34			—			34
Stockholders’ equity (deficit) attributable to Navistar International Corporation	(4,654		)	(7,402		)	6,664			738			(4,654		)
Total liabilities and stockholders’ equity (deficit)	$	(6,707	)	$	8,356		$	4,988		$	806		$	7,443

Condensed Consolidating Statement of Cash Flows for the Six Months Ended April 30, 2014
(in millions)	NIC			Navistar, Inc.			Non-Guarantor Subsidiaries			Eliminations and Other			Consolidated
Net cash provided by (used in) operations	$	(458	)	$	(961	)	$	85		$	1,008		$	(326	)
Cash flows from investment activities
Net change in restricted cash and cash equivalents	5			(1		)	(25		)	—			(21		)
Net sales of marketable securities	389			—			(93		)	—			296
Capital expenditures and purchase of equipment leased to others	—			(67		)	(91		)	—			(158		)
Other investing activities	—			8			17			—			25
Net cash provided by (used in) investment activities	394			(60		)	(192		)	—			142
Cash flows from financing activities
Net borrowings (repayments) of debt	(10		)	959			68			(1,006		)	11
Other financing activities	18			34			(30		)	—			22
Net cash provided by (used in) financing activities	8			993			38			(1,006		)	33
Effect of exchange rate changes on cash and cash equivalents	—			—			(8		)	(2		)	(10		)
Decrease in cash and cash equivalents	(56		)	(28		)	(77		)	—			(161		)
Cash and cash equivalents at beginning of the period	336			72			347			—			755
Cash and cash equivalents at end of the period	$	280		$	44		$	270		$	—		$	594

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Commitments and Contingencies

6 Months Ended

Apr. 30, 2015

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Commitments and Contingencies

Guarantees

We occasionally provide guarantees that could obligate us to make future payments if the primary entity fails to perform under its contractual obligations. We have recognized liabilities for some of these guarantees in our Consolidated Balance Sheets as they meet the recognition and measurement provisions of U.S. GAAP. In addition to the liabilities that have been recognized, we are contingently liable for other potential losses under various guarantees. We do not believe that claims that may be made under such guarantees would have a material effect on our financial condition, results of operations, or cash flows.

In March 2010, we entered into an operating agreement, as amended, which contains automatic extensions and is subject to early termination provisions, with GE (the "GE Operating Agreement"). Under the terms of the GE Operating Agreement, as amended, GE is our preferred source of retail customer financing for equipment offered by us and our dealers in the U.S. We provide GE with a loss sharing arrangement for certain credit losses. Under the loss sharing arrangement, as amended, we generally reimburse GE for credit losses in excess of the first 10% of the financed value of a contract; for certain leases we reimburse GE for credit losses up to a maximum of the first 9.5% of the financed value of those lease contracts. The Company’s exposure to loss is mitigated because contracts under the GE Operating Agreement are secured by the financed equipment. There were $1.6 billion and $1.5 billion of outstanding loan principal and operating lease payments receivable at April 30, 2015 and October 31, 2014, financed through the GE Operating Agreement and subject to the loss sharing arrangements in the U.S. The related financed values of these outstanding contracts were $2.3 billion at both April 30, 2015 and October 31, 2014. Generally, we do not carry the contracts under the GE Operating Agreement on our Consolidated Balance Sheets. However, for certain GE financed contracts which we have accounted for as borrowings, we have recognized equipment leased to others of $129 million and financed lease obligations of $139 million in our Consolidated Balance Sheets for the period ended April 30, 2015.

Historically, our losses, representing the entire loss amount, on similar contracts, measured as a percentage of the average balance of the related contracts, ranged from 0.3% to 2.1%. Under limited circumstances NFC retains the right to originate retail customer financings. Based on our historic experience of losses on similar contracts and the nature of the loss sharing arrangement, we do not believe our share of losses related to balances currently outstanding will be material.

For certain independent dealers’ wholesale inventory financed by third-party banks or finance companies, we provide limited repurchase agreements to the respective financing institution. The amount of losses related to these arrangements has not been material to our Consolidated Statements of Operations or Consolidated Statements of Cash Flows and the value of the guarantees and accruals recorded are not material to our Consolidated Balance Sheets.

We also have issued limited residual value guarantees in connection with various leases. The amounts of the guarantees are estimated and recorded. Our guarantees are contingent upon the fair value of the leased assets at the end of the lease term. The amount of losses related to these arrangements has not been material to our Consolidated Statements of Operations or Consolidated Statements of Cash Flows and the value of the guarantees and accruals recorded are not material to our Consolidated Balance Sheets.

We obtain certain stand-by letters of credit and surety bonds from third-party financial institutions in the ordinary course of business when required under contracts or to satisfy insurance-related requirements. As of April 30, 2015, the amount of stand-by letters of credit and surety bonds was $88 million.

We extend credit commitments to certain truck fleet customers, which allow them to purchase parts and services from participating dealers. The participating dealers receive accelerated payments from us with the result that we carry the receivables and absorb the credit risk related to these customers. As of April 30, 2015, the total credit limit under this program was $11 million of which $7 million was unused.

In addition, as of April 30, 2015, we have entered into various purchase commitments of $120 million and contracts that have cancellation fees of $33 million with various expiration dates through 2020.

In the ordinary course of business, we also provide routine indemnifications and other guarantees, the terms of which range in duration and often are not explicitly defined. We do not believe these will result in claims that would have a material impact on our financial condition, results of operations, or cash flows.

Environmental Liabilities

We have been named a potentially responsible party ("PRP"), in conjunction with other parties, in a number of cases arising under an environmental protection law, the Comprehensive Environmental Response, Compensation, and Liability Act, popularly known as the "Superfund" law. These cases involve sites that allegedly received wastes from current or former Company locations. Based on information available to us which, in most cases, consists of data related to quantities and characteristics of material generated at current or former Company locations, material allegedly shipped by us to these disposal sites, as well as cost estimates from PRPs and/or federal or state regulatory agencies for the cleanup of these sites, a reasonable estimate is calculated of our share of the probable costs, if any, and accruals are recorded in our consolidated financial statements. These accruals are generally recognized no later than upon completion of the remedial feasibility study and are not discounted to their present value. We review all accruals on a regular basis and believe that, based on these calculations, our share of the potential additional costs for the cleanup of each site will not have a material effect on our financial condition, results of operations, or cash flows.

Two sites formerly owned by us: (i) Solar Turbines in San Diego, California, and (ii) the Canton Plant in Canton, Illinois; were identified as having soil and groundwater contamination. Two sites in Sao Paulo, Brazil, one at which we are currently operating and one where we formerly operated, were identified as having soil and groundwater contamination. While investigations and cleanup activities continue at these and other sites, we believe that we have adequate accruals to cover costs to complete the cleanup of all sites.

We have accrued $22 million for these and other environmental matters, which are included within Other current liabilities and Other noncurrent liabilities, as of April 30, 2015. The majority of these accrued liabilities are expected to be paid subsequent to 2015.

Along with other vehicle manufacturers, we have been subject to an increased number of asbestos-related claims in recent years. In general, these claims relate to illnesses alleged to have resulted from asbestos exposure from component parts found in older vehicles, although some cases relate to the alleged presence of asbestos in our facilities. In these claims, we are generally not the sole defendant, and the claims name as defendants numerous manufacturers and suppliers of a wide variety of products allegedly containing asbestos. We have strongly disputed these claims, and it has been our policy to defend against them vigorously. Historically, the actual damages paid out to claimants have not been material in any year to our financial condition, results of operations, or cash flows. It is possible that the number of these claims will continue to grow, and that the costs for resolving asbestos related claims could become significant in the future.

Legal Proceedings

Overview

We are subject to various claims arising in the ordinary course of business, and are party to various legal proceedings that constitute ordinary, routine litigation incidental to our business. The majority of these claims and proceedings relate to commercial, product liability, and warranty matters. In addition, from time to time we are subject to various claims and legal proceedings related to employee compensation, benefits, and benefits administration including, but not limited to, compliance with the Employee Retirement Income Security Act of 1974, as amended ("ERISA"), and Department of Labor requirements. In our opinion, apart from the actions set forth below, the disposition of these proceedings and claims, after taking into account recorded accruals and the availability and limits of our insurance coverage, will not have a material adverse effect on our business or our financial condition, results of operations, or cash flows.

Profit Sharing Disputes

Pursuant to the 1993 Settlement Agreement, the program administrator and named fiduciary of the Supplemental Benefit Program is the Supplemental Benefit Program committee (the "Committee"), comprised of non-Company individuals. In August 2013, the Committee filed a motion for leave to amend its February 2013 complaint (which sought injunctive relief for the Company to provide certain information to which it was allegedly entitled under the Supplemental Benefits Profit Sharing Plan) and a proposed amended complaint (the "Profit Sharing Complaint") in the U.S. District Court for the Southern District of Ohio (the "Court"). Leave to file the Profit Sharing Complaint was granted by the Court in October 2013. In its Profit Sharing Complaint, the Committee alleged the Company breached the 1993 Settlement Agreement and violated ERISA by failing to properly calculate profit sharing contributions due under the Supplemental Benefits Profit Sharing Plan. The Committee seeks damages in excess of $50 million, injunctive relief and reimbursement of attorneys' fees and costs. In October 2013, the Company filed a Motion to Dismiss the Profit Sharing Complaint and to compel the Committee to comply with the dispute resolution procedures set forth in the Supplemental Benefits Profit Sharing Plan. In March 2014, the Court denied the Company's Motion to Dismiss and ruled, among other things, that the Company waived its right to compel the Committee to comply with the dispute resolution provisions set forth in the Supplemental Benefits Profit Sharing Plan. In April 2014, the Company appealed the Court's refusal to compel the Committee to comply with the dispute resolution process to the Court of Appeals for the 6th Circuit. The Company also filed a motion with the Court to stay all proceedings pending the appeal. In May 2014, the Court granted the motion to stay all proceedings, including discovery, pending the appeal. In March 2015, the Court of Appeals vacated the Court's March 2014 denial of the Company's Motion to Dismiss and related ruling and remanded with instructions to order that the Committee's claims in the Profit Sharing Complaint be arbitrated. In May 2015, the Court ordered that the claims in the Profit Sharing Complaint be arbitrated pursuant to the dispute resolution procedures in the Supplemental Benefit Profit Sharing Plan.

In addition, various local bargaining units of the UAW have filed separate grievances pursuant to the profit sharing plans under various collective bargaining agreements in effect between the Company and the UAW that may have similar legal and factual issues as the Profit Sharing Complaint.

Based on our assessment of the facts underlying the claims in the above actions, we are unable to provide meaningful quantification of how the final resolution of these claims may impact our future consolidated financial condition, results of operations, or cash flows.

FATMA Notice

International Indústria de Motores da América do Sul Ltda. ("IIAA"), formerly known as Maxion International Motores S/A ("Maxion"), now a wholly owned subsidiary of the Company, received a notice in July 2010 from the State of Santa Catarina Environmental Protection Agency ("FATMA") in Brazil. The notice alleged that Maxion had sent wastes to a facility owned and operated by a company known as Natureza and that soil and groundwater contamination had occurred at the Natureza facility. The notice asserted liability against Maxion and assessed an initial penalty in the amount of R$2 million (the equivalent of less than US$1 million at April 30, 2015), which is not due and final until all administrative appeals are exhausted. Maxion was one of numerous companies that received similar notices. IIAA filed an administrative defense in August 2010 and has not yet received a decision following that filing. IIAA disputes the allegations in the notice and intends to vigorously defend itself.

Sao Paulo Groundwater Notice

In March 2014, IIAA, along with other nearby companies, received from the Sao Paulo District Attorney a notice and proposed Consent Agreement relating to alleged neighborhood-wide groundwater contamination at or around its Sao Paulo manufacturing facility. The proposed Consent Agreement seeks certain groundwater investigations and other technical relief and proposes sanctions in the amount of R$3 million (the equivalent of approximately US$1 million at April 30, 2015). In November 2014, IIAA extended a settlement offer and the parties remain in discussions regarding this matter.

MaxxForce Engine EGR Warranty Litigation

On June 24, 2014, N&C Transportation Ltd. filed a putative class action lawsuit against NIC, Navistar, Inc., Navistar Canada Inc., and Harbour International Trucks in Canada in the Supreme Court of British Columbia (the "N&C Action").  Subsequently, five additional, similar putative class action lawsuits have been filed in Canada (together with the N&C Action, the "Canadian Actions").

On July 7, 2014, Par 4 Transport, LLC filed a putative class action lawsuit against Navistar, Inc. in the United States District Court for the Northern District of Illinois (the "Par 4 Action"). Subsequently, similar putative class action lawsuits were filed in various United States district courts, including the Northern District of Illinois, the Eastern District of Wisconsin, the Southern District of Florida, the Southern District of Texas, the District of Minnesota, the Northern District of Alabama, the Western District of Kentucky, and the Middle District of Pennsylvania (together with the Par 4 Action, the "U.S. Actions"). The U.S. Actions contained allegations substantially similar to the Canadian Actions. More specifically, the Canadian Actions and the U.S. Actions (collectively, the "EGR Class Actions") seek to certify one or more classes of persons or entities in Canada or the United States who purchased and/or leased a ProStar or other Navistar vehicle equipped with a model year 2008-2013 MaxxForce Advanced EGR engine.  In substance, the EGR Class Actions allege that the MaxxForce Advanced EGR engines are defective and that Navistar, Inc. failed to disclose and/or correct the alleged defect. The EGR Class Actions assert claims based on various theories, including breach of contract, breach of warranty, consumer fraud, unfair competition, misrepresentation and negligence. The EGR Class Actions seek relief in the form of monetary damages, punitive damages, declaratory relief, interest, fees, and costs.

On October 3, 2014, NIC and Navistar, Inc. filed a motion before the United States Judicial Panel on Multidistrict Litigation (the "MDL Panel") seeking to transfer and consolidate before Judge Joan B. Gottschall of the United States District Court for the Northern District of Illinois all of the U.S. Actions then pending, as well as certain non-class action MaxxForce Advanced EGR engine lawsuits pending in various federal district courts. On December 17, 2014, Navistar's motion was granted. The MDL Panel issued an order consolidating all of the U.S. Actions pending on the date the motion was filed before Judge Gottschall in the United States District Court for the Northern District of Illinois. The MDL Panel also consolidated certain non-class action MaxxForce Advanced EGR engine lawsuits pending in the various federal district courts, with the exception of one matter.

For cases filed after the initial ruling by the MDL Panel, we continue to request that the MDL Panel similarly transfer and consolidate cases involving one or more common questions of fact. To date, eight putative class actions and three non-class cases have been added to the MDL proceeding before Judge Gottschall. On March 5, 2015, Judge Gottschall entered an order in the MDL proceeding, appointing interim lead counsel and interim liaison counsel for the Plaintiffs. On May 11, 2015, lead counsel for the Plaintiffs filed a First Master Consolidated Class Action Complaint. The next status conference is set for July 2015.

Based on our assessment of the facts underlying the claims in the above actions, we are unable to provide meaningful quantification of how the final resolution of these claims may impact our future consolidated financial condition, results of operations, or cash flows.

EPA Notice of Violation

In February 2012, Navistar, Inc. received a Notice of Violation ("NOV") from the U.S. Environmental Protection Agency ("EPA"). The NOV pertains to approximately 7,600 diesel engines which, according to the EPA, were produced by Navistar, Inc. in 2010 and, therefore, should have met the EPA's 2010 emissions standards. Navistar, Inc. previously provided information to the EPA evidencing its belief that the engines were in fact produced in 2009. The NOV contains the EPA's conclusion that Navistar, Inc.'s alleged production of the engines in 2010 violated the Federal Clean Air Act. The NOV states that the EPA reserves the right to file an administrative complaint or to refer this matter to the U.S. Department of Justice ("DOJ") with a recommendation that a civil complaint be filed in federal district court. In July 2014, the DOJ informed Navistar that the matter had been referred to the DOJ. Navistar and the DOJ are in continuing discussions concerning this matter. If the DOJ ultimately initiates litigation, it is likely that the DOJ will request a significant civil penalty.

Based on our assessment of the facts underlying the NOV above, we are unable to provide meaningful quantification of how the final resolution of this matter may impact our future consolidated financial condition, results of operations or cash flows.

CARB Notice of Violation

In April 2013, Navistar, Inc. received a notice of violation and proposed settlement ("Notice") from the California Air Resources Board ("CARB"). The Notice alleges violations of the California regulations relating to verification of after-treatment devices and proposed civil penalties of approximately $2.5 million, among other proposed settlement terms. Beginning in June 2013, the Company has made settlement offers to CARB and remains in discussions regarding this matter. In October 2014, the parties tentatively agreed to resolve the matter for a penalty payment of $0.3 million and the Company's agreement to conduct certain in-use testing. The parties are in the process of finalizing documents formalizing the settlement.

Shareholder Litigation

In March 2013, a putative class action complaint, alleging securities fraud, was filed against us by the Construction Workers Pension Trust Fund - Lake County and Vicinity, on behalf of itself and all other similarly situated purchasers of our common stock between the period of November 3, 2010 and August 1, 2012. A second class action complaint was filed in April 2013 by the Norfolk County Retirement System, individually and on behalf of all other similarly situated purchasers of our common stock between the period of June 9, 2010 and August 1, 2012. A third class action complaint was filed in April 2013 by Jane C. Purnell FBO Purnell Family Trust, on behalf of itself and all other similarly situated purchasers of our common stock between the period of November 3, 2010 and August 1, 2012. Each complaint named us as well as Daniel C. Ustian, our former President and Chief Executive Officer, and Andrew J. Cederoth, our former Executive Vice President and Chief Financial Officer as defendants. These complaints (collectively, the "10b-5 Cases") contain similar factual allegations which include, among other things, that we violated the federal securities laws by knowingly issuing materially false and misleading statements concerning our financial condition and future business prospects and that we misrepresented and omitted material facts in filings with the SEC concerning the timing and likelihood of EPA certification of our EGR technology to meet 2010 EPA emission standards. The plaintiffs in these matters seek compensatory damages and attorneys' fees, among other relief. In May 2013, an order was entered transferring and consolidating all cases before one judge and in July 2013, the Court appointed a lead plaintiff and lead plaintiff's counsel. The lead plaintiff filed a consolidated amended complaint in October 2013. The consolidated amended complaint enlarged the proposed class period to June 9, 2009 through August 1, 2012, and named fourteen additional current and former directors and officers as defendants. In December 2013, we filed a motion to dismiss the consolidated amended complaint. In July 2014, the Court granted the defendants' Motions to Dismiss, denied the lead plaintiff's Motion to Strike as moot, and gave the lead plaintiff leave to file a second consolidated amended complaint. In August, 2014, the plaintiff timely filed a Second Amended Complaint, which narrows the claims in two ways. First, the plaintiff abandoned its claims against the majority of the defendants, asserting claims against only Navistar, Dan Ustian, A.J. Cederoth, Jack Allen, and Eric Tech. The plaintiff also shortened the putative class period by changing the class period commencement date from June 9, 2009 to March 10, 2010. Defendants filed their Motion to Dismiss the Second Amended Complaint in September, 2014 and in October, 2014, the plaintiff filed its opposition to defendants Motion to Dismiss. In November, 2014, defendants filed their reply brief in support of defendants Motion to Dismiss the Second Amended Complaint. Also in November 2014, the plaintiff voluntarily dismissed Eric Tech as a defendant. The Court had set a ruling date on the Motion to Dismiss the Second Amended Complaint for February 17, 2015. On the Court's own motions, the ruling date was initially extended to April 15, 2015 and subsequently extended again to May 13, 2015 and subsequently extended again to June 11, 2015.

In March 2013, James Gould filed a derivative complaint on behalf of the Company against us and certain of our current and former directors and former officers. The complaint alleges, among other things, that certain of our current and former directors and former officers committed a breach of fiduciary duty, waste of corporate assets and were unjustly enriched in relation to similar factual allegations made in the 10b-5 Cases. The plaintiff in this matter seeks compensatory damages, certain corporate governance reforms, certain injunctive relief, disgorgement of the proceeds of certain defendants' profits from the sale of Company stock, and attorneys' fees, among other relief. On May 3, 2013, the Court entered a Stipulation and Order to Stay Action, staying the case pending further order of the court or entry of an order on the motion to dismiss the consolidated amended complaint in the 10b-5 Cases. On July 31, 2014, after the amended complaint was dismissed, the parties filed a status report, and the court entered an order on August 27, 2014 continuing the stay pending a ruling on defendants' Motion to Dismiss the Second Amended Complaint in the 10b-5 Cases.

Each of these matters is pending in the United States District Court, Northern District of Illinois.

In August 2013, Abbie Griffin, filed a derivative complaint in the State of Delaware Court of Chancery, on behalf of the Company and all similarly situated stockholders, against the Company, as the nominal defendant, and certain of our current and former directors and former officers. The complaint alleges, among other things, that certain of our current and former directors and former officers committed a breach of fiduciary duty, in relation to similar factual allegations made in the 10b-5 Cases. The plaintiff in this matter seeks compensatory damages, certain corporate governance reforms, certain injunctive relief, and attorneys' fees, among other relief. On August 29, 2013, the court entered an order staying the case pending resolution of the defendant's Motion to Dismiss the consolidated amended complaint in the 10b-5 Cases. On August 5, 2014, the parties filed a status report with the court requesting that the August 2013 stay order remain in place pending a ruling on defendant's Motion to Dismiss the Second Amended Complaint in the 10b-5 Cases and on November 9, 2014, the court entered an order continuing the stay pending a ruling on defendants’ Motion to Dismiss the Second Amended Complaint in the 10b-5 Cases.

Based on our assessment of the facts underlying these matters described above, we are unable to provide meaningful quantification of how the final resolution of these matters may impact our future consolidated financial condition, results of operations, or cash flows.

Brazil Truck Dealer Disputes

In January 2014, IIAA initiated an arbitration proceeding under the International Chamber of Commerce rules seeking payment for goods sold and unpaid, in the amount of R$64 million, including penalties and interest, from a group of four truck dealers in Brazil. The truck dealers are affiliated with each other, but not with us, and are collectively referred to as Navitrucks. In the proceeding, IIAA also seeks a declaration of fault against Navitrucks related to the termination of the truck dealer agreements between IIAA and Navitrucks. Navitrucks responded in part by submitting counterclaims against IIAA seeking the amount of R$128 million for damages related to alleged unfulfilled promises and injury to Navitrucks’ reputation. In October 2014, Navitrucks amended their counterclaims by increasing the amount of damages. During a preliminary hearing before the arbitral tribunal on March 24, 2015, the parties agreed to submit all of the pending claims between the parties to the exclusive jurisdiction of the arbitral tribunal. The arbitral tribunal will issue a schedule for the arbitration submissions. As of April 30, 2015, the approximate amount of the IIAA claim against Navitrucks is R$71 million (approximately US$24 million as of April 30, 2015), and the approximate amount of the Navitrucks claim against IIAA is R$182 million (approximately US$61 million as of April 30, 2015).

Based on our assessment of the facts underlying the claims in the above actions, we are unable to provide meaningful quantification of how the final resolution of these claims may impact our future consolidated financial condition, results of operations, or cash flows.

In addition, two other truck dealers and a truck fleet owner in Brazil have initiated separate adversarial proceedings against IIAA that may have similar legal and factual issues as the Navitrucks claim. These other claims are not material either individually or in the aggregate.

Other

U.S. Securities and Exchange Commission Inquiry

In June 2012, Navistar received an informal inquiry from the Chicago Office of the Enforcement Division of the SEC seeking a number of categories of documents for the periods dating back to November 1, 2010, relating to various accounting and disclosure issues. We received a formal order of private investigation in July 2012. We have received subsequent subpoenas from the SEC in connection with their inquiry. In December 2014, the SEC filed an application in the United States District Court for the Northern District of Illinois seeking an order compelling the production of certain documents withheld by Navistar from its responses to the administrative subpoenas on the basis of attorney-client privilege and/or work product doctrine. The discovery dispute involves a small number of documents in relation to the number of documents already produced by Navistar. A status hearing on this matter was held on April 2, 2015 and the parties are awaiting a decision from the Court. We continue to cooperate with the SEC in this matter. At this time, we are unable to predict the outcome of this matter or provide meaningful quantification of how the final resolution of this matter may impact our future consolidated financial condition, results of operations or cash flows.

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Postretirement Benefits

6 Months Ended

Apr. 30, 2015

Compensation and Retirement Disclosure [Abstract]

Postretirement Benefits

Postretirement Benefits

Defined Benefit Plans

We provide postretirement benefits to a substantial portion of our employees and retirees. Costs associated with postretirement benefits include pension and postretirement health care expenses for employees, retirees, surviving spouses and dependents.

Generally, the pension plans are non-contributory. Our policy is to fund the pension plans in accordance with applicable U.S. and Canadian government regulations and to make additional contributions from time to time. For the three and six months ended April 30, 2015, we contributed $32 million and $62 million, respectively, and for the three and six months ended April 30, 2014, we contributed $36 million and $65 million, respectively, to our pension plans to meet regulatory funding requirements. In August 2014, the Highway and Transportation Funding Act of 2014 ("HATFA"), including extension of pension funding interest rate relief, was signed into law. As a result, we lowered our funding expectations. We currently anticipate additional contributions of $51 million to our pension plans during the remainder of 2015.

We primarily fund other post-employment benefit ("OPEB") obligations, such as retiree medical, in accordance with a 1993 Settlement Agreement (the "1993 Settlement Agreement"), which requires us to fund a portion of the plans' annual service cost to a retiree benefit trust (the "Base Trust"). The 1993 Settlement Agreement resolved a class action lawsuit originally filed in 1992 regarding the restructuring of the Company's then applicable retiree health care and life insurance benefits. Contributions for the six months ended April 30, 2015 and 2014, as well as anticipated contributions for the remainder of 2015, are not material.

Components of Net Periodic Benefit Expense

Net postretirement benefits expense included in our Consolidated Statements of Operations is comprised of the following:

	Three Months Ended April 30,												Six Months Ended April 30,
	Pension Benefits						Health and Life Insurance Benefits						Pension Benefits						Health and Life Insurance Benefits
(in millions)	2015			2014			2015			2014			2015			2014			2015			2014
Service cost for benefits earned during the period	$	3		$	2		$	2		$	1		$	6		$	6		$	3		$	2
Interest on obligation	35			40			18			17			71			79			36			34
Amortization of cumulative loss	24			23			9			4			49			47			19			8
Amortization of prior service benefit	—			—			(1		)	(1		)	—			—			(2		)	(2		)
Contractual termination benefits	(1		)	—			(1		)	—			(1		)	—			(1		)	—
Premiums on pension insurance	4			—			—			—			5			—			—			—
Expected return on assets	(48		)	(48		)	(8		)	(8		)	(97		)	(96		)	(15		)	(16		)
Net postretirement benefits expense	$	17		$	17		$	19		$	13		$	33		$	36		$	40		$	26

Defined Contribution Plans and Other Contractual Arrangements

Our defined contribution plans cover a substantial portion of domestic salaried employees and certain domestic represented employees. The defined contribution plans contain a 401(k) feature and provide most participants with a matching contribution from the Company. The Company deposits the matching contribution annually. Many participants covered by the plans receive annual Company contributions to their retirement accounts based on an age-weighted percentage of the participant's eligible compensation for the calendar year. Defined contribution expense pursuant to these plans was $8 million and $17 million in the three and six months ended April 30, 2015, respectively, and $7 million and $15 million for the three and six months ended April 30, 2014, respectively.

In accordance with the 1993 Settlement Agreement, an independent Retiree Supplemental Benefit Trust (the "Supplemental Trust") was established. The Supplemental Trust, and the benefits it provides to certain retirees pursuant to a certain Retiree Supplemental Benefit Program under the 1993 Settlement Agreement ("Supplemental Benefit Program"), is not part of the Company's consolidated financial statements.

The Company's contingent profit sharing obligations under a certain Supplemental Benefits Trust Profit Sharing Plan ("Supplemental Benefit Profit Sharing Plan") will continue until certain funding targets defined by the 1993 Settlement Agreement are met. We have recorded no profit sharing accruals based on the operating performance of the entities that are included in the determination of qualifying profits. For more information, see Note 11, Commitments and Contingencies, for a discussion of pending arbitration regarding the Supplemental Benefit Profit Sharing Plan.

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Fair Value Measurements - Narrative (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended		3 Months Ended
	Apr. 30, 2015	Apr. 30, 2014	Apr. 30, 2015	Apr. 30, 2014	Jan. 31, 2014	Oct. 31, 2014
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Asset impairment charges	$ 1	$ 151	$ 8	$ 169
Goodwill	38		38			38
Cash and Cash Equivalents, Maturity Term			90 days
Marketable Securities, Maturity Term			90 days
Brazilian Reporting Unit [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Goodwill, Impairment Loss	0	142	0	142
Indefinite-Lived Intangible Assets (Excluding Goodwill)		43		43
Asset impairment charges		149
Goodwill		142		142
Impairment of Intangible Assets, Indefinite-lived (Excluding Goodwill)	0	7	0	7
North America Truck [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Asset impairment charges					$ 18

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Inventories

6 Months Ended

Apr. 30, 2015

Inventory Disclosure [Abstract]

Inventories

Inventories

The following table presents the components of Inventories:

(in millions)	April 30, 2015		October 31, 2014
Finished products	$	797	$	880
Work in process	85		50
Raw materials	363		389
Total inventories	$	1,245	$	1,319

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Debt

6 Months Ended

Apr. 30, 2015

Debt Disclosure [Abstract]

Debt

Debt

(in millions)	April 30, 2015		October 31, 2014
Manufacturing operations
Senior Secured Term Loan Credit Facility, as amended, due 2017, net of unamortized discount of $3, at both dates	$	694	$	694
8.25% Senior Notes, due 2021, net of unamortized discount of $19 and $20, respectively	1,181		1,180
4.50% Senior Subordinated Convertible Notes, due 2018, net of unamortized discount of $17 and $19, respectively	183		181
4.75% Senior Subordinated Convertible Notes, due 2019, net of unamortized discount of $36 and $40, respectively	375		371
Debt of majority-owned dealerships	28		30
Financing arrangements and capital lease obligations	50		54
Loan Agreement related to 6.5% Tax Exempt Bonds, due 2040	225		225
Promissory Note	5		10
Financed lease obligations	141		184
Other	24		29
Total Manufacturing operations debt	2,906		2,958
Less: Current portion	115		100
Net long-term Manufacturing operations debt	$	2,791	$	2,858

(in millions)	April 30, 2015		October 31, 2014
Financial Services operations
Asset-backed debt issued by consolidated SPEs, at fixed and variable rates, due serially through 2018	$	986	$	914
Bank revolvers, at fixed and variable rates, due dates from 2015 through 2020	1,205		1,242
Commercial paper, at variable rates, program matures in 2017	77		74
Borrowings secured by operating and finance leases, at various rates, due serially through 2018	29		36
Total Financial Services operations debt	2,297		2,266
Less: Current portion	1,096		1,195
Net long-term Financial Services operations debt	$	1,201	$	1,071

Manufacturing Operations

3.00% Senior Subordinated Convertible Notes

In October 2009, we completed the sale of $570 million aggregate principal amount of 3.00% senior subordinated convertible notes ("2014 Convertible Notes"), including over-allotment options. The 2014 Convertible Notes were senior subordinated unsecured obligations of the Company.

In connection with the sale of the 2014 Convertible Notes, the Company purchased call options for $125 million. The call options covered 11,337,870 shares of common stock, subject to adjustments, at an exercise price of $50.27. The call options were intended to minimize share dilution associated with the 2014 Convertible Notes. In addition, in connection with the sale of the 2014 Convertible Notes, the Company also entered into separate warrant transactions whereby, the Company sold warrants for $87 million to sell in the aggregate 11,337,870 shares of common stock, subject to adjustments, at an exercise price of $60.14 per share of common stock.

During the second quarter of 2014, the Company used proceeds from the private issuance of $411 million of 4.75% senior subordinated convertible notes due April 2019 ("2019 Convertible Notes"), as well as cash on-hand, to repurchase $404 million of notional amount of the 2014 Convertible Notes. The Company recorded a charge of $11 million related to the repurchase which was recognized in Other expense (income), net. In conjunction with the repurchases of the 2014 Convertible Notes, call options representing 8,026,456 shares expired or were unwound by the Company and warrants representing 6,523,319 shares were unwound by the Company. On October 15, 2014, upon maturity, the 2014 Convertible Notes were paid in full and the purchased call options expired worthless.

During the first quarter of 2015, warrants representing 1,939,376 shares were unwound by the Company, and the remaining 2,875,175 warrants expired worthless on April 10, 2015.

Financial Services Operations

Asset-backed Debt

In January 2015, the maturity date of the $500 million variable funding notes ("VFN") facility was extended from March 2015 to January 2016.

In November 2014, NFC completed the sale of $250 million of two-year investor notes secured by assets of the wholesale note owner trust. Proceeds were used, in part, to replace the $200 million of investor notes that matured in January 2015. Also in November 2014, the wholesale note owner trust was amended to reduce customer concentration restrictions.

Bank Revolvers and Commercial Paper

In January 2015, NFC paid $125 million in cash dividends to Navistar, Inc. Dividends and certain affiliate loans are subject to the restricted payment covenants set forth in the NFC bank credit facility.

Effective December 2014, our Mexican financial services operation entered into a new two-year commercial paper program for up to P$1.8 billion (the equivalent of approximately US $118 million at April 30, 2015). This program replaces the existing program that was to mature in August 2015.

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Income Taxes

6 Months Ended

Apr. 30, 2015

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

We compute on a quarterly basis an estimated annual effective tax rate considering ordinary income and related income tax expense. For all periods presented, U.S. and certain foreign results are excluded from ordinary income due to ordinary losses for which no benefit can be recognized. Ordinary income refers to income (loss) before income tax expense excluding significant unusual or infrequently occurring items. The tax effect of a significant unusual or infrequently occurring item is recorded in the interim period in which it occurs. Items included in income tax expense in the periods in which they occur include the tax effects of material restructurings, impairments, cumulative effect of changes in tax laws or rates, foreign exchange gains and losses, adjustments to uncertain tax positions, and adjustments to our valuation allowance due to changes in judgment regarding the ability to realize deferred tax assets in future years.

We have evaluated the need to maintain a valuation allowance for deferred tax assets based on our assessment of whether it is more likely than not that deferred tax benefits will be realized through the generation of future taxable income. Appropriate consideration is given to all available evidence, both positive and negative, in assessing the need for a valuation allowance. We continue to maintain a valuation allowance on our U.S. deferred tax assets, as well as certain foreign deferred tax assets, that we believe, on a more-likely-than-not basis, will not be realized. For all remaining deferred tax assets, while we believe that it is more likely than not that they will be realized, we believe that it is reasonably possible that additional deferred tax asset valuation allowances could be required in the next twelve months.

We recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the consolidated financial statements from such a position are measured based on the largest benefit that has a greater than fifty percent likelihood of being realized upon ultimate settlement. As of April 30, 2015, the amount of liability for uncertain tax positions was $42 million. The liability at April 30, 2015 of $42 million has a recorded offsetting tax benefit associated with various issues that total to $14 million. If the unrecognized tax benefits are recognized, all would impact our effective tax rate. However, to the extent we continue to maintain a full valuation allowance against certain deferred tax assets, the effect may be in the form of an increase in the deferred tax asset related to our net operating loss carryforward, which would be offset by a full valuation allowance.

We recognize interest and penalties related to uncertain tax positions as part of Income tax expense. For the three and six months ended April 30, 2015, total interest and penalties related to our uncertain tax positions resulted in an income tax expense of less than $1 million in each period.

We have open tax years back to 2001 with various significant taxing jurisdictions including the U.S., Canada, Mexico, and Brazil. In connection with the examination of tax returns, contingencies may arise that generally result from differing interpretations of applicable tax laws and regulations as they relate to the amount, timing, or inclusion of revenues or expenses in taxable income, or the sustainability of tax credits to reduce income taxes payable. We believe we have sufficient accruals for our contingent tax liabilities. Annual tax provisions include amounts considered sufficient to pay assessments that may result from examinations of prior year tax returns, although actual results may differ. While it is probable that the liability for unrecognized tax benefits may increase or decrease during the next twelve months, we do not expect any such change would have a material effect on our financial condition, results of operations, or cash flows.

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Commitments and Contingencies - Narrative (Details)	6 Months Ended	1 Months Ended	3 Months Ended	1 Months Ended	3 Months Ended			3 Months Ended	12 Months Ended	6 Months Ended		6 Months Ended						6 Months Ended	3 Months Ended
	Apr. 30, 2015 USD ($) site	Mar. 31, 2014 Sao Paulo Groundwater Notice [Member] Sanctions [Member] BRL	Apr. 30, 2015 Sao Paulo Groundwater Notice [Member] Sanctions [Member] USD ($)	Jan. 31, 2014 International Chamber of Commerce [Member] Penalties and Interest [Member] dealer	Jan. 31, 2014 International Chamber of Commerce [Member] Penalties and Interest [Member] BRL	Jan. 31, 2014 Navitrucks [Member] Alleged Unfulfilled Promises and Injury to Reputation [Member] BRL	Apr. 30, 2012 Damages from Product Defects [Member] engine	Apr. 30, 2013 California Air Resources Board (CARB) [Member] USD ($)	Oct. 31, 2014 California Air Resources Board (CARB) [Member] USD ($)	Apr. 30, 2015 G E Operating Agreement [Member] USD ($)	Oct. 31, 2014 G E Operating Agreement [Member] USD ($)	Apr. 30, 2015 Minimum [Member]	Apr. 30, 2015 Maximum [Member]	Apr. 30, 2015 G E Operating Agreement [Member] USD ($)	Apr. 30, 2015 Manufacturing Operations [Member] Financed lease obligations [Member] USD ($)	Oct. 31, 2014 Manufacturing Operations [Member] Financed lease obligations [Member] USD ($)	Apr. 30, 2015 Manufacturing Operations [Member] G E Operating Agreement [Member] Financed lease obligations [Member] USD ($)	Apr. 30, 2015 Pending Litigation [Member] Disputes [Member] USD ($)	Apr. 30, 2015 Pending Litigation [Member] FATMA Notice, Trial [Member] Penalties [Member] USD ($)	Apr. 30, 2015 Pending Litigation [Member] FATMA Notice, Trial [Member] Penalties [Member] BRL	Apr. 30, 2015 IIAA Vs. Navitrucks [Member] USD ($)	Apr. 30, 2015 IIAA Vs. Navitrucks [Member] BRL	Apr. 30, 2015 Navitrucks Vs. IIAA [Member] USD ($)	Apr. 30, 2015 Navitrucks Vs. IIAA [Member] BRL
Loss Contingencies [Line Items]
Operating Agreement Excess Loss Percentage										10.00%
Loss Sharing Agreement, Percentage										9.50%
Off Balance Sheet Finance Receivables										$ 1,600,000,000	$ 1,500,000,000
Off Balance Sheet Finance Receivables Related Originations										2,300,000,000	2,300,000,000
Equipment leased to others														129,000,000
Long-term Debt															141,000,000	184,000,000	139,000,000
Historical losses on finance receivables, measured as percentage of average balance of related finance receivable												0.30%	2.10%
Available stand-by letters of credit and surety bonds	88,000,000
Line of Credit Facility, Current Borrowing Capacity	11,000,000
Line of Credit Facility, Remaining Borrowing Capacity	7,000,000
Purchase commitments	120,000,000
Long Term Purchase Commitment Cancellation Fees	33,000,000
Number of Contaminated Sites	2
Number of Contaminated Sites in Sao Paulo, Brazil	2
Accrual for environmental loss contingencies	22,000,000
Damages sought, value		3,000,000	1,000,000		64,000,000	128,000,000												50,000,000	1,000,000	2,000,000
Loss Contingency, Number of Plaintiffs				4
Notice of Violation, number							7,600
Regulatory Penalty								2,500,000	300,000
Gain Contingency, Unrecorded Amount																					24,000,000	71,000,000
Loss Contingency, Estimate of Possible Loss																							$ 61,000,000	182,000,000

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Segment Reporting - Summary of Segment Assets (Details) (USD $) In Millions, unless otherwise specified	Apr. 30, 2015	Oct. 31, 2014
Segment Reporting Information [Line Items]
Segment Assets	$ 6,925	$ 7,443
North America Truck [Member]
Segment Reporting Information [Line Items]
Segment Assets	2,104	2,245
North America Parts [Member]
Segment Reporting Information [Line Items]
Segment Assets	669	672
Global Operations [Member]
Segment Reporting Information [Line Items]
Segment Assets	514	657
Financial Services Operations [Member]
Segment Reporting Information [Line Items]
Segment Assets	2,611	2,598
Corporate And Eliminations [Member]
Segment Reporting Information [Line Items]
Segment Assets	$ 1,027	$ 1,271

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Financial Instruments and Commodity Contracts - Foreign Currency Contracts (Details) (Foreign Exchange Contract [Member]) In Millions, unless otherwise specified	Apr. 30, 2015 Euro Member Countries, Euro Maturing May 2015 [Member] EUR (€)	Apr. 30, 2015 Euro Member Countries, Euro Maturing June 2015 [Member] EUR (€)	Apr. 30, 2015 Euro Member Countries, Euro Maturing July 2015 [Member] EUR (€)	Apr. 30, 2015 Euro Member Countries, Euro Maturing Aug 2015 - Oct 2015 [Member] EUR (€)		Oct. 31, 2014 Euro Member Countries, Euro Maturing Nov 2014 [Member] EUR (€)	Oct. 31, 2014 Euro Member Countries, Euro Maturing Dec 2014 [Member] EUR (€)	Oct. 31, 2014 Euro Member Countries, Euro Maturing Jan 2015 [Member] EUR (€)	Oct. 31, 2014 Euro Member Countries, Euro Maturing Feb 2015 - Oct 2015 [Member] EUR (€)		Apr. 30, 2015 Canada, Dollars Maturing May 2015 [Member] CAD	Apr. 30, 2015 Canada, Dollars Maturing June 2015 [Member] CAD	Apr. 30, 2015 Canada, Dollars Maturing July 2015 [Member] CAD	Apr. 30, 2015 Canada, Dollars Maturing Aug 2015 - Oct 2015 [Member] CAD
Derivative [Line Items]
Derivative, Notional Amount Expiring Monthly				€ 2					€ 1					25
Derivative, Notional Amount	€ 6	€ 5	€ 5	€ 6	[1]	€ 4	€ 4	€ 5	€ 9	[2]	25	25	25	75	[3]

[1] Forward exchange contracts of €2 million expire on the last day of each month from August 2015 through October 2015.

[2] Forward exchange contracts of €1 million expire on the last day of each month from February 2015 through October 2015.

[3] Forward exchange contracts of C$25 million expire on the last day of each month from August 2015 through October 2015.

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Stockholders' Deficit (Tables) (Tables)

6 Months Ended

Apr. 30, 2015

Equity [Abstract]

Schedule of Accumulated Other Comprehensive Income (Loss) [Table Text Block]

Accumulated other comprehensive loss, net of tax, included in the Consolidated Statements of Stockholders' Deficit, consisted of the following:

(in millions)	Unrealized Gain on Marketable Securities		Foreign Currency Translation Adjustments			Defined Benefit Plans			Total
Balance as of January 31, 2015	$	1	$	(186	)	$	(2,105	)	$	(2,290	)
Other comprehensive loss before reclassifications	—		(27		)	—			(27		)
Amounts reclassified out of accumulated other comprehensive loss	—		—			33			33
Net current-period other comprehensive income (loss)	—		(27		)	33			6
Balance as of April 30, 2015	$	1	$	(213	)	$	(2,072	)	$	(2,284	)

(in millions)	Unrealized Gain on Marketable Securities		Foreign Currency Translation Adjustments			Defined Benefit Plans			Total
Balance as of October 31, 2014	$	1	$	(127	)	$	(2,137	)	$	(2,263	)
Other comprehensive loss before reclassifications	—		(86		)	—			(86		)
Amounts reclassified out of accumulated other comprehensive loss	—		—			65			65
Net current-period other comprehensive income (loss)	—		(86		)	65			(21		)
Balance as of April 30, 2015	$	1	$	(213	)	$	(2,072	)	$	(2,284	)

(in millions)	Unrealized Gain on Marketable Securities		Foreign Currency Translation Adjustments			Defined Benefit Plans			Total
Balance as of January 31, 2014	$	—	$	(137	)	$	(1,724	)	$	(1,861	)
Other comprehensive income (loss) before reclassifications	—		48			(1		)	47
Amounts reclassified out of accumulated other comprehensive loss	—		—			26			26
Net current-period other comprehensive income	—		48			25			73
Balance as of April 30, 2014	$	—	$	(89	)	$	(1,699	)	$	(1,788	)

(in millions)	Unrealized Gain on Marketable Securities		Foreign Currency Translation Adjustments			Defined Benefit Plans			Total
Balance as of October 31, 2013	$	—	$	(75	)	$	(1,749	)	$	(1,824	)
Other comprehensive loss before reclassifications	—		(14		)	(2		)	(16		)
Amounts reclassified out of accumulated other comprehensive loss	—		—			52			52
Net current-period other comprehensive income (loss)	—		(14		)	50			36
Balance as of April 30, 2014	$	—	$	(89	)	$	(1,699	)	$	(1,788	)

Reclassification out of Accumulated Other Comprehensive Income [Table Text Block]

	Location in Consolidated Statements of Operations	Three Months Ended April 30, 2015			Six Months Ended April 30, 2015
Defined benefit plans
Amortization of prior service costs	Selling, general and administrative expenses	$	(1	)	$	(2	)
Amortization of actuarial loss	Selling, general and administrative expenses	34			68
	Total before tax	$	33		$	66
	Tax expense	—			(1		)
Total reclassifications for the period, net of tax		$	33		$	65

	Location in Consolidated Statements of Operations	Three Months Ended April 30, 2014			Six Months Ended April 30, 2014
Defined benefit plans
Amortization of prior service costs	Selling, general and administrative expenses	$	(1	)	$	(2	)
Amortization of actuarial loss	Selling, general and administrative expenses	27			54
Total reclassifications for the period (net of tax of $0 at both dates)		$	26		$	52

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Debt - Schedule of Debt Instruments (Details) (USD $) In Millions, unless otherwise specified	Apr. 30, 2015	Oct. 31, 2014
Debt Instrument [Line Items]
Long-term Debt and Capital Lease Obligations	$ 3,992	$ 3,929
Financial Services Operations [Member]
Debt Instrument [Line Items]
Long-term Debt and Capital Lease Obligations, Including Current Maturities	2,297	2,266
Long-term Debt and Capital Lease Obligations, Current	1,096	1,195
Long-term Debt and Capital Lease Obligations	1,201	1,071
Financial Services Operations [Member] | Secured Debt [Member]
Debt Instrument [Line Items]
Long-term Debt	986	914
Financial Services Operations [Member] | Line of Credit [Member]
Debt Instrument [Line Items]
Long-term Debt	1,205	1,242
Financial Services Operations [Member] | Commercial Paper [Member]
Debt Instrument [Line Items]
Long-term Debt	77	74
Financial Services Operations [Member] | Borrowings Secured By Operating and Finance Leases [Member]
Debt Instrument [Line Items]
Long-term Debt	29	36
Manufacturing Operations [Member]
Debt Instrument [Line Items]
Long-term Debt and Capital Lease Obligations, Including Current Maturities	2,906	2,958
Long-term Debt and Capital Lease Obligations, Current	115	100
Long-term Debt and Capital Lease Obligations	2,791	2,858
Manufacturing Operations [Member] | Line of Credit [Member]
Debt Instrument [Line Items]
Long-term Debt	694	694
Manufacturing Operations [Member] | Notes Payable to Banks [Member] | Eight Point Two Five Percent Senior Notes [Member]
Debt Instrument [Line Items]
Debt Instrument, Unamortized Discount	19	20
Debt Instrument, Interest Rate, Stated Percentage	8.25%
Long-term Debt	1,181	1,180
Manufacturing Operations [Member] | Convertible Subordinated Debt [Member] | Four Point Five Zero Senior Subordinated Convertible Notes [Member]
Debt Instrument [Line Items]
Debt Instrument, Unamortized Discount	17	19
Debt Instrument, Interest Rate, Stated Percentage	4.50%
Long-term Debt	183	181
Manufacturing Operations [Member] | Convertible Subordinated Debt [Member] | Four Point Seven Five Senior Subordinated Convertible Notes [Member] [Member]
Debt Instrument [Line Items]
Debt Instrument, Unamortized Discount	36	40
Debt Instrument, Interest Rate, Stated Percentage	4.75%
Long-term Debt	375	371
Manufacturing Operations [Member] | Debt Of Majority Owned Dealerships [Member]
Debt Instrument [Line Items]
Long-term Debt	28	30
Manufacturing Operations [Member] | Financing Arrangements and Capital Lease Obligations [Member]
Debt Instrument [Line Items]
Long-term Debt	50	54
Manufacturing Operations [Member] | Tax Exempt Bond [Member]
Debt Instrument [Line Items]
Debt Instrument, Interest Rate, Stated Percentage	6.50%
Long-term Debt	225	225
Manufacturing Operations [Member] | Promissory Note [Member]
Debt Instrument [Line Items]
Long-term Debt	5	10
Manufacturing Operations [Member] | Financed lease obligations [Member]
Debt Instrument [Line Items]
Long-term Debt	141	184
Manufacturing Operations [Member] | Notes Payable, Other Payables [Member]
Debt Instrument [Line Items]
Long-term Debt	$ 24	$ 29

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Stockholders' Deficit

6 Months Ended

Apr. 30, 2015

Equity [Abstract]

Stockholders' Equity Note Disclosure [Text Block]

Stockholders' Deficit

Accumulated Other Comprehensive Loss

Changes in Accumulated other comprehensive loss, net of tax, included in the Consolidated Statements of Stockholders' Deficit, consisted of the following:

(in millions)	Unrealized Gain on Marketable Securities		Foreign Currency Translation Adjustments			Defined Benefit Plans			Total
Balance as of January 31, 2015	$	1	$	(186	)	$	(2,105	)	$	(2,290	)
Other comprehensive loss before reclassifications	—		(27		)	—			(27		)
Amounts reclassified out of accumulated other comprehensive loss	—		—			33			33
Net current-period other comprehensive income (loss)	—		(27		)	33			6
Balance as of April 30, 2015	$	1	$	(213	)	$	(2,072	)	$	(2,284	)

(in millions)	Unrealized Gain on Marketable Securities		Foreign Currency Translation Adjustments			Defined Benefit Plans			Total
Balance as of October 31, 2014	$	1	$	(127	)	$	(2,137	)	$	(2,263	)
Other comprehensive loss before reclassifications	—		(86		)	—			(86		)
Amounts reclassified out of accumulated other comprehensive loss	—		—			65			65
Net current-period other comprehensive income (loss)	—		(86		)	65			(21		)
Balance as of April 30, 2015	$	1	$	(213	)	$	(2,072	)	$	(2,284	)

(in millions)	Unrealized Gain on Marketable Securities		Foreign Currency Translation Adjustments			Defined Benefit Plans			Total
Balance as of January 31, 2014	$	—	$	(137	)	$	(1,724	)	$	(1,861	)
Other comprehensive income (loss) before reclassifications	—		48			(1		)	47
Amounts reclassified out of accumulated other comprehensive loss	—		—			26			26
Net current-period other comprehensive income	—		48			25			73
Balance as of April 30, 2014	$	—	$	(89	)	$	(1,699	)	$	(1,788	)

(in millions)	Unrealized Gain on Marketable Securities		Foreign Currency Translation Adjustments			Defined Benefit Plans			Total
Balance as of October 31, 2013	$	—	$	(75	)	$	(1,749	)	$	(1,824	)
Other comprehensive loss before reclassifications	—		(14		)	(2		)	(16		)
Amounts reclassified out of accumulated other comprehensive loss	—		—			52			52
Net current-period other comprehensive income (loss)	—		(14		)	50			36
Balance as of April 30, 2014	$	—	$	(89	)	$	(1,699	)	$	(1,788	)

The following table displays the amounts reclassified from Accumulated other comprehensive loss and the affected line item in the Consolidated Statements of Operations:

	Location in Consolidated Statements of Operations	Three Months Ended April 30, 2015			Six Months Ended April 30, 2015
Defined benefit plans
Amortization of prior service costs	Selling, general and administrative expenses	$	(1	)	$	(2	)
Amortization of actuarial loss	Selling, general and administrative expenses	34			68
	Total before tax	$	33		$	66
	Tax expense	—			(1		)
Total reclassifications for the period, net of tax		$	33		$	65

	Location in Consolidated Statements of Operations	Three Months Ended April 30, 2014			Six Months Ended April 30, 2014
Defined benefit plans
Amortization of prior service costs	Selling, general and administrative expenses	$	(1	)	$	(2	)
Amortization of actuarial loss	Selling, general and administrative expenses	27			54
Total reclassifications for the period (net of tax of $0 at both dates)		$	26		$	52

Stockholders' Deficit

	Location in Consolidated Statements of Operations	Three Months Ended April 30, 2015			Six Months Ended April 30, 2015
Defined benefit plans
Amortization of prior service costs	Selling, general and administrative expenses	$	(1	)	$	(2	)
Amortization of actuarial loss	Selling, general and administrative expenses	34			68
	Total before tax	$	33		$	66
	Tax expense	—			(1		)
Total reclassifications for the period, net of tax		$	33		$	65

	Location in Consolidated Statements of Operations	Three Months Ended April 30, 2014			Six Months Ended April 30, 2014
Defined benefit plans
Amortization of prior service costs	Selling, general and administrative expenses	$	(1	)	$	(2	)
Amortization of actuarial loss	Selling, general and administrative expenses	27			54
Total reclassifications for the period (net of tax of $0 at both dates)		$	26		$	52

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Finance Receivables (Tables)

6 Months Ended

Apr. 30, 2015

Receivables [Abstract]

Schedule of Accounts, Notes, Loans and Financing Receivable [Table Text Block]

Our Finance receivables, net consist of the following:

(in millions)	April 30, 2015		October 31, 2014
Retail portfolio	$	667	$	726
Wholesale portfolio	1,515		1,339
Total finance receivables	2,182		2,065
Less: Allowance for doubtful accounts	28		27
Total finance receivables, net	2,154		2,038
Less: Current portion, net(A)	1,929		1,758
Noncurrent portion, net	$	225	$	280

_________________________

(A) The current portion of finance receivables is computed based on contractual maturities. Actual cash collections typically vary from the contractual cash flows because of prepayments, extensions, delinquencies, credit losses, and renewals.

Finance Revenues Derived From Receivables [Table Text Block]

The following table presents the components of our Finance revenues:

	Three Months Ended April 30,						Six Months Ended April 30,
(in millions)	2015			2014			2015			2014
Retail notes and finance leases revenue	$	12		$	16		$	25		$	33
Wholesale notes interest	24			19			48			37
Operating lease revenue	15			15			30			29
Retail and wholesale accounts interest	9			7			17			13
Gross finance revenues	60			57			120			112
Less: Intercompany revenues	(25		)	(19		)	(49		)	(35		)
Finance revenues	$	35		$	38		$	71		$	77

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Allowance for Doubtful Accounts - Narrative (Details) (USD $) In Millions, unless otherwise specified	6 Months Ended
	Apr. 30, 2015	Apr. 30, 2014	Jan. 31, 2015 class segments
Accounts, Notes, Loans and Financing Receivable [Line Items]
Number of Portfolio Segments for Finance Receivables	2		2
Classes Of Receivables In Each Portfolio			1
Retail Portfolio [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Impaired Financing Receivable, Average Recorded Investment	$ 25	$ 16

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Restructuring and Impairments - Restructuring Reserve by Type (Details) (USD $) In Millions, unless otherwise specified	6 Months Ended
	Apr. 30, 2015	Apr. 30, 2014	Oct. 31, 2014	Oct. 31, 2013
Restructuring Cost and Reserve [Line Items]
Restructuring Reserve	$ 18	$ 30	$ 20	$ 34
Restructuring and Related Cost, Incurred Cost	7	11
Payments for Restructuring	8	15
Restructuring Reserve, Accrual Adjustment	(1)	0
Employee Severance [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring Reserve	10	16	8	15
Restructuring and Related Cost, Incurred Cost	7	9
Payments for Restructuring	4	8
Restructuring Reserve, Accrual Adjustment	(1)	0
Employee Relocation [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring Reserve		0		0
Restructuring and Related Cost, Incurred Cost		1
Payments for Restructuring		1
Restructuring Reserve, Accrual Adjustment		0
Lease Vacancy [Member] [Domain]
Restructuring Cost and Reserve [Line Items]
Restructuring Reserve	7	15	11	18
Restructuring and Related Cost, Incurred Cost	0	1
Payments for Restructuring	4	4
Restructuring Reserve, Accrual Adjustment	0	0
Other Restructuring [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring Reserve	1	(1)	1	1
Restructuring and Related Cost, Incurred Cost	0	0
Payments for Restructuring	0	2
Restructuring Reserve, Accrual Adjustment	$ 0	$ 0

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Consolidated Balance Sheets (USD $) In Millions, unless otherwise specified	Apr. 30, 2015	Oct. 31, 2014
Current assets
Cash and cash equivalents	$ 583	$ 497
Restricted cash and cash equivalents	0	40
Marketable securities	273	605
Trade and other receivables, net	502	553
Finance receivables, net	1,929	1,758
Inventories	1,245	1,319
Deferred taxes, net	38	55
Other current assets	206	186
Total current assets	4,776	5,013
Restricted cash	113	131
Trade and other receivables, net	18	25
Finance receivables, net	225	280
Investments in non-consolidated affiliates	68	73
Property and equipment (net of accumulated depreciation and amortization of $2,590 and $2,535, respectively)	1,407	1,562
Goodwill	38	38
Intangible assets (net of accumulated amortization of $113 and $109, respectively)	74	90
Deferred taxes, net	134	145
Other noncurrent assets	72	86
Total assets	6,925	7,443
Current liabilities
Notes payable and current maturities of long-term debt	1,211	1,295
Accounts payable	1,450	1,564
Other current liabilities	1,345	1,372
Total current liabilities	4,006	4,231
Long-term debt	3,992	3,929
Postretirement benefits liabilities	2,770	2,862
Deferred taxes, net	14	14
Other noncurrent liabilities	887	1,025
Total liabilities	11,669	12,061
Redeemable equity securities	1	2
Stockholders’ deficit
Series D convertible junior preference stock	3	3
Common stock (86.8 shares issued, and $0.10 par value per share and 220 shares authorized, all at both dates)	9	9
Additional paid-in capital	2,498	2,500
Accumulated deficit	(4,788)	(4,682)
Accumulated other comprehensive loss	(2,284)	(2,263)
Common stock held in treasury, at cost (5.3 and 5.4 shares, respectively)	(213)	(221)
Total stockholders’ deficit attributable to Navistar International Corporation	(4,775)	(4,654)
Stockholders’ equity attributable to non-controlling interests	30	34
Total stockholders’ deficit	(4,745)	(4,620)
Total liabilities and stockholders’ deficit	$ 6,925	$ 7,443

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Restructuring and Impairments

6 Months Ended

Apr. 30, 2015

Restructuring and Related Activities [Abstract]

Restructurings and Impairments

Restructurings and Impairments

Restructuring charges are recorded based on restructuring plans that have been committed to by management and are, in part, based upon management's best estimates of future events. Changes to the estimates may require future adjustments to the restructuring liabilities.

Restructuring Liability

The following tables summarize the activity in the restructuring liability, which includes amounts related to discontinued operations and excludes pension and other postretirement contractual termination benefits:

(in millions)	Balance at October 31, 2014		Additions		Payments			Adjustments			Balance at April 30, 2015
Employee termination charges	$	8	$	7	$	(4	)	$	(1	)	$	10
Lease vacancy	11		—		(4		)	—			7
Other	1		—		—			—			1
Restructuring liability	$	20	$	7	$	(8	)	$	(1	)	$	18

(in millions)	Balance at October 31, 2013		Additions		Payments			Adjustments		Balance at April 30, 2014
Employee termination charges	$	15	$	9	$	(8	)	$	—	$	16
Employee relocation costs	—		1		(1		)	—		—
Lease vacancy	18		1		(4		)	—		15
Other	1		—		(2		)	—		(1		)
Restructuring liability	$	34	$	11	$	(15	)	$	—	$	30

North American Manufacturing Restructuring Activities

We continue to focus on improving our core North American Truck and Parts businesses. We continue to evaluate our portfolio of assets, with the purpose of closing or divesting non-core/non-strategic businesses, and identifying opportunities to restructure our business and rationalize our Manufacturing operations in an effort to optimize our cost structure. The Company is currently evaluating its portfolio of assets to validate their strategic and financial fit. To allow us to increase our focus on our North America core businesses, we are evaluating product lines, businesses, and engineering programs that fall outside of our core businesses. We are using a Return-On-Invested-Capital ("ROIC") methodology, combined with an assessment of the strategic fit to our core businesses, to identify areas that are not performing to our expectations. For those areas, we are evaluating whether to fix, divest, or close. These actions could result in additional restructuring and other related charges in the future, including but not limited to: (i) impairments, (ii) costs for employee and contractor termination and other related benefits, and (iii) charges for pension and other postretirement contractual benefits and curtailments. These charges could be significant.

Chatham restructuring activities

In the third quarter of 2011, the Company committed to close its Chatham, Ontario heavy truck plant, which had been idled since June 2009. Potential additional charges in future periods could range from $0 million to $60 million, primarily related to pension, postretirement costs and termination benefits, which are subject to employee negotiation, acceptance rates and the resolution of disputes related thereto.

Foundry Facilities

In December 2014, we announced the closure of our Indianapolis, Indiana foundry facility, and on April 30, 2015, we sold our Waukesha, Wisconsin foundry operations. As a result of these actions, the Truck segment recognized charges of $13 million and $12 million in the first and second quarter of 2015, respectively, for the acceleration of depreciation of certain assets related to the foundry facilities. These charges are reported within Costs of products sold in the Company's Consolidated Statements of Operations. We expect to incur the remaining accelerated depreciation charges in the third quarter of 2015.

Cost-Reductions and Other Strategic Initiatives

From time to time, we have announced, and we may continue to announce, actions to control spending across the Company with targeted reductions of certain costs. We are focused on continued reductions in discretionary spending, including reductions resulting from efficiencies, and prioritizing or eliminating certain programs or projects.

In the second quarter of 2014, the Company initiated new cost-reduction actions, including an enterprise-wide reduction-in-force. As a result of these actions, the Company recognized restructuring charges of $8 million in personnel costs for employee termination and related benefits, the majority of which was paid during 2014. The Company expects the remaining restructuring charges will be paid throughout 2015.

Asset Impairments

The following table reconciles our impairment charges in our Consolidated Statements of Operations

	Three Months Ended April 30,				Six Months Ended April 30,
(in millions)	2015		2014		2015		2014
Goodwill impairment charge	$	—	$	142	$	—	$	142
Intangible asset impairment charge	—		7		—		7
Other asset impairment charges related to continuing operations	1		2		8		20
Total asset impairment charges	$	1	$	151	$	8	$	169

In the first quarter of 2015, the Company concluded it had a triggering event related to certain operating leases. As a result, the Truck segment recorded $7 million of asset impairment charges, which are recognized in Asset impairment charges in the Company's Consolidated Statements of Operations. 

In the second quarter of 2014, we recognized a total non-cash charge of $149 million for the impairment of certain intangible assets of our Brazilian engine reporting unit. As a result of the economic downturn in Brazil causing declines in actual and forecasted results, we tested the goodwill and indefinite-lived intangible asset of our Brazilian engine reporting unit for potential impairment. As a result, we determined that the entire $142 million balance of goodwill and $7 million of trademarks were impaired. For more information, see Note 1, Summary of Significant Accounting Policies.

In the first quarter of 2014, the Company concluded it had a triggering event related to potential sales of assets requiring assessment of impairment for certain intangible and long-lived assets in the Truck segment. As a result, certain amortizing intangible assets and long-lived assets were determined to be fully impaired, resulting in an impairment charge of $19 million that was recognized in the six months ended April 30, 2014 in Asset impairment charges in the Company's Consolidated Statements of Operations.

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Fair Value Measurements - Financial Instruments Measured on Nonrecurring Basis (Details) (USD $) In Millions, unless otherwise specified	Apr. 30, 2015		Oct. 31, 2014
Impaired finance receivables with specific loss reserves [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Impaired Financing Receivable, Recorded Investment	$ 20		$ 20
Impaired finance receivables with specific loss reserves [Member] | Fair Value, Inputs, Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Impaired Financing Receivable, Recorded Investment	20	[1]	20	[1]
Specific loss reserves on impaired finance receivables [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Specific loss reserve	(9)		(6)
Specific loss reserves on impaired finance receivables [Member] | Fair Value, Inputs, Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Specific loss reserve	(9)		(6)
Estimate of Fair Value Measurement [Member] | Fair Value, Measurements, Nonrecurring [Member] | Fair Value, Inputs, Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Finance Receivables Fair Value Disclosure	$ 11		$ 14

[1] Certain impaired finance receivables are measured at fair value on a nonrecurring basis. An impairment charge is recorded for the amount by which the carrying value of the receivables exceeds the fair value of the underlying collateral, net of remarketing costs. Fair values of the underlying collateral are determined by reference to dealer vehicle value publications adjusted for certain market factors.

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Stockholders' Deficit - Narrative (Details) (USD $) In Millions, except Per Share data, unless otherwise specified	Apr. 30, 2015	Oct. 31, 2014
Class of Stock [Line Items]
Common stock, shares issued	86.8	86.8
Common stock, shares authorized	220	220
Common stock, par value	$ 0.10	$ 0.10

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Allowance for Doubtful Accounts (Tables)

6 Months Ended

Apr. 30, 2015

Allowance for Doubtful Accounts [Abstract]

Allowance For Credit Losses On Receivables [Table Text Block]

The following tables present the activity related to our allowance for doubtful accounts for our retail portfolio segment, wholesale portfolio segment, and trade and other receivables:

	Three Months Ended April 30, 2015											Three Months Ended April 30, 2014
(in millions)	Retail Portfolio			Wholesale Portfolio		Trade and Other Receivables			Total			Retail Portfolio			Wholesale Portfolio		Trade and Other Receivables			Total
Allowance for doubtful accounts, at beginning of period	$	23		$	3	$	32		$	58		$	22		$	2	$	36		$	60
Provision for doubtful accounts, net of recoveries	3			—		—			3			3			—		1			4
Charge-off of accounts(A)	—			—		—			—			(3		)	—		(2		)	(5		)
Other(B)	(1		)	—		(2		)	(3		)	—			—		3			3
Allowance for doubtful accounts, at end of period	$	25		$	3	$	30		$	58		$	22		$	2	$	38		$	62

	Six Months Ended April 30, 2015											Six Months Ended April 30, 2014
(in millions)	Retail Portfolio			Wholesale Portfolio		Trade and Other Receivables			Total			Retail Portfolio			Wholesale Portfolio		Trade and Other Receivables			Total
Allowance for doubtful accounts, at beginning of period	$	24		$	3	$	38		$	65		$	21		$	2	$	37		$	60
Provision for doubtful accounts, net of recoveries	5			—		—			5			7			—		3			10
Charge-off of accounts(A)	(1		)	—		(3		)	(4		)	(5		)	—		(2		)	(7		)
Other(B)	(3		)	—		(5		)	(8		)	(1		)	—		—			(1		)
Allowance for doubtful accounts, at end of period	$	25		$	3	$	30		$	58		$	22		$	2	$	38		$	62

________________________

(A) We repossess sold and leased vehicles on defaulted finance receivables and leases, and place them into Inventories. Losses recognized at the time of repossession and charged against the allowance for doubtful accounts were both less than $1 million, for the three and six months ended April 30, 2015, as well as for the three and six months ended April 30, 2014

Impaired Financing Receivables [Table Text Block]

The following table presents information regarding impaired finance receivables:

	April 30, 2015						October 31, 2014
(in millions)	Retail Portfolio		Wholesale Portfolio		Total		Retail Portfolio		Wholesale Portfolio		Total
Impaired finance receivables with specific loss reserves	$	20	$	—	$	20	$	20	$	—	$	20
Impaired finance receivables without specific loss reserves	7		—		7		1		—		1
Specific loss reserves on impaired finance receivables	9		—		9		6		—		6
Finance receivables on non-accrual status	27		—		27		21		—		21

Allowance for Credit Losses on Financing Receivables [Table Text Block]

The Company uses the aging of its receivables as well as other inputs when assessing credit quality. The following table presents the aging analysis for finance receivables:

	April 30, 2015						October 31, 2014
(in millions)	Retail Portfolio		Wholesale Portfolio		Total		Retail Portfolio		Wholesale Portfolio		Total
Current, and up to 30 days past due	$	586	$	1,515	$	2,101	$	643	$	1,333	$	1,976
30-90 days past due	57		—		57		64		2		66
Over 90 days past due	24		—		24		19		4		23
Total finance receivables	$	667	$	1,515	$	2,182	$	726	$	1,339	$	2,065

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Condensed Consolidating Guarantor and Non-Guarantor Financial Information - Statement of Comprehsive Income (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended
	Apr. 30, 2015	Apr. 30, 2014	Apr. 30, 2015	Apr. 30, 2014
Net loss attributable to Navistar International Corporation	$ (64)	$ (297)	$ (106)	$ (545)
Other comprehensive income (loss):
Foreign currency translation adjustment	(27)	48	(86)	(14)
Defined benefit plans (net of tax of $(0), for all entities)	33	25	65	50
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent	6	73	(21)	36
Total comprehensive loss attributable to Navistar International Corporation	(58)	(224)	(127)	(509)
Defined benefit plan, tax	0	0	(1)	(1)
Parent Company [Member]
Net loss attributable to Navistar International Corporation	(64)	(297)	(106)	(545)
Other comprehensive income (loss):
Foreign currency translation adjustment	(27)	48	(86)	(14)
Defined benefit plans (net of tax of $(0), for all entities)	33	25	65	50
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent	6	73	(21)	36
Total comprehensive loss attributable to Navistar International Corporation	(58)	(224)	(127)	(509)
Defined benefit plan, tax	0	0
Guarantor Subsidiaries [Member]
Net loss attributable to Navistar International Corporation	(75)	(334)	(134)	(582)
Other comprehensive income (loss):
Foreign currency translation adjustment	0	0	0	0
Defined benefit plans (net of tax of $(0), for all entities)	31	25	62	50
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent	31	25	62	50
Total comprehensive loss attributable to Navistar International Corporation	(44)	(309)	(72)	(532)
Defined benefit plan, tax	0	0
Non-Guarantor Subsidiaries [Member]
Net loss attributable to Navistar International Corporation	99	(79)	158	(63)
Other comprehensive income (loss):
Foreign currency translation adjustment	(27)	48	(86)	(14)
Defined benefit plans (net of tax of $(0), for all entities)	2	0	3	0
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent	(25)	48	(83)	(14)
Total comprehensive loss attributable to Navistar International Corporation	74	(31)	75	(77)
Defined benefit plan, tax	0	0
Consolidation, Eliminations [Member]
Net loss attributable to Navistar International Corporation	(24)	413	(24)	645
Other comprehensive income (loss):
Foreign currency translation adjustment	27	(48)	86	14
Defined benefit plans (net of tax of $(0), for all entities)	(33)	(25)	(65)	(50)
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent	(6)	(73)	21	(36)
Total comprehensive loss attributable to Navistar International Corporation	(30)	340	(3)	609
Defined benefit plan, tax	$ 0	$ 0

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Summary of Significant Accounting Policies - Variable Interest Entities (Details) (USD $) In Millions, unless otherwise specified	Apr. 30, 2015	Oct. 31, 2014	Apr. 30, 2014	Oct. 31, 2013	May 28, 2015
Variable Interest Entity [Line Items]
Cash and cash equivalents	$ 583	$ 497	$ 594	$ 755
Variable Interest Entity Primary Beneficiary Blue Diamond Parts And Blue Diamond Truck [Member]
Variable Interest Entity [Line Items]
Variable Interest Entity, Consolidated, Carrying Amount, Assets	263	297
Cash and cash equivalents	87	77
Liabilities	238	250
Variable Interest Entity Primary Beneficiary Securitizations Treated As Borrowings [Member] | Financial Services Operations [Member]
Variable Interest Entity [Line Items]
Variable Interest Entity, Consolidated, Carrying Amount, Assets	1,200	1,100
Liabilities	923	896
Transaction Does Not Qualify for Sale Accounting [Member] | Financial Services Operations [Member]
Variable Interest Entity [Line Items]
Variable Interest Entity, Consolidated, Carrying Amount, Assets	213	156
Liabilities	$ 92	$ 54
Subsequent Event [Member] | Variable Interest Entity Primary Beneficiary, Blue Diamond Trucks [Member]
Variable Interest Entity [Line Items]
Noncontrolling Interest, Ownership Percentage by Noncontrolling Owners					25.00%

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Segment Reporting

6 Months Ended

Apr. 30, 2015

Segment Reporting [Abstract]

Segment Reporting

Segment Reporting

During November 2014, we announced changes in our leadership team and in our organizational and reporting structures. We believe this realignment will guide us into the future and enable us to accelerate our performance as we finish the turnaround. These changes impact how our Chief Operating Decision Maker (“CODM”) assesses the performance of our operating segments and makes decisions about resource allocations. As a result, we identified the following changes within our reportable segments:

• The export truck and parts operations, formerly in our Global Operations segment, are now included within the results of our Truck and Parts segments, respectively.

• Parts required to support the military truck lines, formerly within our Parts segment, are now included within the results of our Truck segment.

All prior period segment information has been updated to conform to the 2015 presentation. Other than the changes noted above, there were no material changes to the reportable segments disclosed in our Annual Report on Form 10-K for the year ended October 31, 2014. The change in reportable segments had no effect on the Company's consolidated financial position, results of operations, or cash flows for the periods presented.

The following is a description of our four reporting segments:

• Our Truck segment manufactures and distributes Class 4 through 8 trucks, buses, and military vehicles under the International and IC Bus ("IC") brands, along with production of engines under the MaxxForce brand name and parts required to support the military truck lines, in the markets that include sales in the U.S., Canada, Mexico, and within our export truck business. In an effort to strengthen and maintain our dealer network, this segment occasionally acquires and operates dealer locations for the purpose of transitioning ownership.

• Our Parts segment provides customers with proprietary products needed to support the International commercial truck, IC Bus, MaxxForce engine lines, and export parts business, as well as our other product lines. Our Parts segment also provides a wide selection of other standard truck, trailer, and engine aftermarket parts. Also included in the Parts segment are the operating results of BDP, which manages the sourcing, merchandising, and distribution of certain service parts we sell to Ford in North America.

• Our Global Operations segment primarily consists of the IIAA (formerly MWM International Industria De Motores Da America Do Sul Ltda. ("MWM")) engine and truck operations in Brazil. The IIAA engine operations produce diesel engines, primarily under contract manufacturing arrangements, as well as under the MWM brand, for sale to OEMs in South America. In addition, our Global Operations segment includes the operating results of our joint venture in China with Anhui Jianghuai Automobile Co ("JAC").

• Our Financial Services segment provides retail, wholesale, and lease financing of products sold by the Truck and Parts segments and their dealers within the U.S. and Mexico, as well as financing for wholesale accounts and selected retail accounts receivable.

Corporate contains those items that are not included in our four segments.

Segment Profit (Loss)

We define segment profit (loss) as Net income (loss) from continuing operations attributable to Navistar International Corporation excluding Income tax benefit (expense). Selected financial information is as follows:

(in millions)	Truck			Parts		Global Operations			Financial Services(A)		Corporate and Eliminations			Total
Three Months Ended April 30, 2015
External sales and revenues, net	$	1,933		$	607	$	115		$	35	$	3		$	2,693
Intersegment sales and revenues(B)	33			6		15			25		(79		)	—
Total sales and revenues, net	$	1,966		$	613	$	130		$	60	$	(76	)	$	2,693
Income (loss) from continuing operations attributable to NIC, net of tax	$	(51	)	$	133	$	1		$	22	$	(169	)	$	(64	)
Income tax expense	—			—		—			—		(18		)	(18		)
Segment profit (loss)	$	(51	)	$	133	$	1		$	22	$	(151	)	$	(46	)
Depreciation and amortization	$	47		$	4	$	5		$	12	$	6		$	74
Interest expense	—			—		—			18		57			75
Equity in income (loss) of non-consolidated affiliates	1			1		(1		)	—		—			1
Capital expenditures(C)	24			—		1			2		1			28

(in millions)	Truck			Parts		Global Operations			Financial Services(A)		Corporate and Eliminations			Total
Three Months Ended April 30, 2014
External sales and revenues, net	$	1,829		$	614	$	265		$	38	$	—		$	2,746
Intersegment sales and revenues	60			16		6			19		(101		)	—
Total sales and revenues, net	$	1,889		$	630	$	271		$	57	$	(101	)	$	2,746
Income (loss) from continuing operations attributable to NIC, net of tax	$	(129	)	$	133	$	(162	)	$	24	$	(164	)	$	(298	)
Income tax expense	—			—		—			—		(23		)	(23		)
Segment profit (loss)	$	(129	)	$	133	$	(162	)	$	24	$	(141	)	$	(275	)
Depreciation and amortization	$	71		$	4	$	6		$	11	$	7		$	99
Interest expense	—			—		—			17		57			74
Equity in income of non-consolidated affiliates	1			1		1			—		—			3
Capital expenditures(C)	26			1		1			—		1			29

(in millions)	Truck			Parts		Global Operations			Financial Services(A)		Corporate and Eliminations			Total
Six Months Ended April 30, 2015
External sales and revenues, net	$	3,564		$	1,221	$	253		$	71	$	5		$	5,114
Intersegment sales and revenues(B)	72			18		29			49		(168		)	—
Total sales and revenues, net	$	3,636		$	1,239	$	282		$	120	$	(163	)	$	5,114
Income (loss) from continuing operations attributable to NIC, net of tax	$	(69	)	$	278	$	(14	)	$	46	$	(347	)	$	(106	)
Income tax expense	—			—		—			—		(25		)	(25		)
Segment profit (loss)	$	(69	)	$	278	$	(14	)	$	46	$	(322	)	$	(81	)
Depreciation and amortization	$	99		$	7	$	12		$	24	$	11		$	153
Interest expense	—			—		—			38		114			152
Equity in income (loss) of non-consolidated affiliates	3			2		(2		)	—		—			3
Capital expenditures(C)	38			—		3			2		2			45

(in millions)	Truck			Parts		Global Operations			Financial Services(A)		Corporate and Eliminations			Total
Six Months Ended April 30, 2014
External sales and revenues, net	$	3,220		$	1,188	$	469		$	77	$	—		$	4,954
Intersegment sales and revenues	120			28		14			35		(197		)	—
Total sales and revenues, net	$	3,340		$	1,216	$	483		$	112	$	(197	)	$	4,954
Income (loss) from continuing operations attributable to NIC, net of tax	$	(337	)	$	241	$	(197	)	$	47	$	(301	)	$	(547	)
Income tax expense	—			—		—			—		(11		)	(11		)
Segment profit (loss)	$	(337	)	$	241	$	(197	)	$	47	$	(290	)	$	(536	)
Depreciation and amortization	$	129		$	8	$	14		$	21	$	13		$	185
Interest expense	—			—		—			34		122			156
Equity in income (loss) of non-consolidated affiliates	2			2		(1		)	—		—			3
Capital expenditures(C)	38			5		4			1		2			50

(in millions)	Truck		Parts		Global Operations		Financial Services		Corporate and Eliminations		Total
Segment assets, as of:
April 30, 2015	$	2,104	$	669	$	514	$	2,611	$	1,027	$	6,925
October 31, 2014	2,245		672		657		2,598		1,271		7,443

_________________________

(A) Total sales and revenues in the Financial Services segment include interest revenues of $44 million and $89 million for the three and six months ended April 30, 2015, respectively and $42 million and $82 million for the three and six months ended April 30, 2014, respectively.

(B) During the second quarter of 2015, we identified a $35 million adjustment related to the first quarter of 2015 Intersegment sales and revenues. As a result, the Truck segment and Corporate and Eliminations should have reported Intersegment sales and revenues of $39 million and $(89) million, respectively, and reported Total sales and revenues, net, of $1,670 million and $(87) million, respectively, for the three months ended January 31, 2015. The adjustment did not impact the consolidated results for the first quarter of 2015.

(C) Exclusive of purchases of equipment leased to others.