8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): October 17, 2006

NAVISTAR INTERNATIONAL CORPORATION

(Exact name of registrant as specified in its charter)

Delaware	1-9618	36-3359573
(State or other jurisdiction of incorporation or organization)	(Commission File No.)	(I.R.S. Employer Identification No.)

4201 Winfield Road, P.O. Box 1488, Warrenville, Illinois	60555
(Address of principal executive offices)	(Zip Code)

Registrant's telephone number, including area code (630) 753-5000

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

[_] Written communications pursuant to Rule 425 under the Securities Act

[_] Soliciting material pursuant to Rule 14a-12 under the Exchange Act

[_] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act

[_] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act

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ITEM 1.01ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT

In light of the blackout trading restrictions imposed upon Navistar International Corporation (the “company”) in accordance with Regulation Blackout Trading Restriction (“Regulation BTR”), on October 17, 2006 the Board of Directors of the company, upon recommendation of the Nominating and Governance Committee, approved the following actions:

1.   In lieu of the fiscal year 2006 annual grant to each director of 4,000 shares of company common stock as part of the company’s overall director compensation, each director is to be awarded a cash payment in the amount of $43,200;

2.   Suspended the requirement that each director receive at least one-fourth of their annual retainer in the form of restricted stock during such period in which Regulation BTR applies. Accordingly, each director will receive the entire annual retainer of $60,000 in four equal quarterly cash payments;

3.   Suspended for calendar year 2007 each director’s ability to elect to receive stock in lieu of a cash payment in accordance with the Non-Employee Directors Deferred Fee Plan filed as Exhibit 10.34 to the company’s Form 10-Q dated and filed with the Securities and Exchange Commission (“SEC”) on March 11, 2002; and

4.   Extended the expiration date of an option to purchase 2,000 shares of company common stock granted to Mr. John Correnti on December 18, 1996 in connection with his service as a director of the company. This option expiration date has been extended until 30 days after the company’s blackout trading restriction expires.

On October 17, 2006, the Compensation Committee of the Board of Directors of the company approved the Annual Incentive Plan Criteria for fiscal year 2007 for named executive officers. The Annual Incentive Awards for fiscal year 2007 will be awarded under, and are subject to the terms and conditions of, the company’s 2004 Performance Incentive Plan as amended and restated as of February 15, 2005 as previously filed as Appendix A to the company’s 2005 proxy statement dated and filed with the SEC on February 23, 2005. The performance criteria applicable to these awards are set forth in Exhibit 10.57 attached to this report and hereby incorporated herein by reference.

ITEM 5.02DEPARTURE OF DIRECTORS OR PRINCIPAL OFFICERS; ELECTION OF DIRECTORS; APPOINTMENT OF PRINCIPAL OFFICERS

On October 17, 2006, Mr. Robert C. Lannert notified Navistar International Corporation (the “company’) of his intent to resign as a director of the company. In light of the vacancy to be created by Mr. Lannert’s resignation, the Board of Directors elected Mr. William A. Caton, the company’s Executive Vice President and Chief Financial Officer, as a Class I director to fill such vacancy effective upon Mr. Lannert’s resignation. Mr. Caton is not a party to any transaction with the company or any of its subsidiaries in which he had a direct or indirect material interest requiring disclosure under this Item and will not serve on any committees of the Board of Directors.

On October 17, 2006, the Board of Directors of the company also elected Mr. John P. Waldron as an executive officer of the company being Vice President and Corporate Controller. For further information on this disclosure, please see the company’s Current Report on Form 8-K dated and filed with the SEC on September 21, 2006 and hereby incorporated herein by reference.

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ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS

The following Exhibits are deemed to be filed under the Securities Exchange Act of 1934, as amended.

(d)	Exhibits
	Exhibit No.	Description	Page
	10.57	Annual Incentive Plan Criteria	E-1

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

NAVISTAR INTERNATIONAL CORPORATION

Registrant

Date: October 23, 2006	/s/ William A. Caton
	William A. Caton Executive Vice President and Chief Financial Officer

EX-10.57

EXHIBIT 10.57

Fiscal Year 2007 Annual Incentive Plan Criteria

The Annual Incentive Plan rewards performance based upon consolidated, business unit and individual results. The named executive officers are assigned the following Target Award Percentage of their base salary for fiscal year 2007 Annual Incentive Awards:

Level	Target Award Percentage
CEO	110%
13	95%
12	75%
11	65%

Awards are based upon the consolidated results of the company and/or the individual’s business unit results. The weighting factors for corporate and business unit performance for named executive officers is as follows:

Level	Corporate / Business Unit Weight
CEO and Level 13	100% / 0%
11-12	80% / 20%

The payout multiple of a participant’s Target Award Percentage, depending upon whether threshold, target, distinguished or super-distinguished performance is achieved is as follows:

Payout Multiple of Target Award Percentage

Threshold        25%

Target100%

Distinguished150%

Super-Distinguished  200%

The consolidated results of the company shall be measured based upon a return on equity (“ROE”) calculation. ROE shall be calculated as consolidated net income divided by consolidated equity. Business unit results shall be measured based primarily on income needed to support the consolidated ROE goal.

E-1