RELATED PARTY TRANSACTIONS

6 Months Ended

Jun. 30, 2015

RELATED PARTY TRANSACTIONS [Abstract]

RELATED PARTY TRANSACTIONS

NOTE 9 – RELATED PARTY TRANSACTIONS

Due from (to) related parties

Amount due from related parties are principally for advances in the normal course of business for parts and suppliers used in manufacturing.

Amount due from related parties are as follows (in thousands):

	June 30,     2015		December 31, 2014
Sanmen Branch of Zhejiang UFO Automobile Manufacturing Co.,Ltd	$	1,321	$	1,427
JAZ		1,291		1,311
Jonway Motor Cycle		176		53
Jonway EV selling Ltd.		132		-
	$	2,920	$	2,791

Amount due to related parties are follows (in thousands):

	June 30,       2015		December 31, 2014
Jonway Group	$	9,950	$	2,648
Jonway Economy and Trade Co., Ltd.		1,517		-
Jonway Motor Cycle		64		64
Taizhou Huadu		764		652
Shanghai Zapple		37		37
Mr. Wang		326		146
Betterworld		149		149
Taizhou Jonway Electric Vehicle Selling Co., Ltd.		-		2,306
Zhejiang Jonway Painting Co., Ltd.		388		472
Cathaya Operations Management Ltd.		728		297
Cathaya Management Ltd.		350		350
	$	14,273	$	7,121

Transactions with `Jonway Group

Jonway Group is considered as a related party as the Wang Family, one of the principal shareholders of the Company, has controlling interests in Jonway Group. Jonway Group supplies some of plastics spare parts to Jonway Auto and gave guarantees on Jonway Auto short term bank facilities from China-based banks. Jonway Auto made such purchase from Jonway Group for a total of $1,299,000 and $390,000 for the six months ended June 30, 2015 and 2014, respectively. Jonway Auto made such purchase from Jonway Group for a total of $544,000 and $168,000 for the three months ended June 30, 2015 and 2014, respectively.

Jonway Auto Agreement with Zhejiang UFO

Based on a contract by and among the Zhejiang UFO, Jonway Group and Jonway Auto dated as of January 1, 2006, Zhejiang UFO has authorized Jonway Auto to operate its Sanmen Branch to assemble and sell UFO branded SUVs for a period of 10 years starting from January 1, 2006.

According to the contract, Jonway Auto shall pay Zhejiang UFO a variable contractual fee which is calculated based on the number of SUVs that Jonway Auto assembles in the Sanmen Branch every year, at the following rates (historical exchange rate):

The first 3,000 vehicles	$44 per vehicle
Vehicles from 3,001 to 5,000	$30 per vehicle
Vehicles over 5,000	$22 per vehicle

Zhejiang UFO is considered a related party because the Wang Family, who are shareholders of Jonway Auto, has certain non-controlling equity interests in Zhejiang UFO.