**UNITED
      STATES**


**SECURITIES
      AND EXCHANGE COMMISSION**


Washington,
      D.C. 20549





**FORM
      10−QSB**


(Mark
      One)





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





For
      the
      quarterly period ended: August 31, 2007





**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 No. 0-51437**





**BESTWAY
      COACH EXPRESS INC.**


(Exact
      name of small business issuer as specified in its charter)





NEW
                YORK
            
            13-3961159(State
                or other jurisdiction of incorporation or organization)
            
            (I.R.S.
                Empl. Ident. No.)





2
      Mott
      Street, 7thFloor,
      New York, New York, 10013


(Address
      of Principal Executive Offices)





(212)
      608-8988


(Registrant’s
      Telephone Number, Including Area Code)





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





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





The
      number of shares outstanding of each of the issuer’s classes of common equity,
      as of October 10, 2007, are as follows:





Class
                of Securities
            
            Shares
                OutstandingCommon
                Stock, $0.001 par value
            
            13,780,000





Transitional
      Small Business Disclosure Format (check one): Yes o No
x








**PART
      I — FINANCIAL INFORMATION**





**ITEM 1. 
      FINANCIAL STATEMENTS**





**BESTWAY
      COACH EXPRESS INC.**


**BALANCE
      SHEET**


**As
      of August 31, 2007**


**(UNAUDITED)**





**Assets**Current
                assetsCash
                and cash equivalents
            
            $
            39,647Trade
                accounts receivable, net
            
            
            210,540Fuel
                tax receivable
            
            
            38,265Inventories
            
            
            110,363Prepaid
                expenses
            
            
            68,709Total
                current assets
            
            
            467,524Property
                and equipmentTotal
                property and equipment
            
            
            8,892,113Less:
                accumulated depreciation and amortization
            
            
            (3,515,768
            )Property
                and equipment, net
            
            
            5,376,345Other
                assetsDeposits
                and other assets
            
            
            9,418Deferred
                tax asset
            
            
            103,291Total
                other assets
            
            
            112,709Total
                assets
            
            $
            5,956,578**Liabilities
                and Stockholders’ Deficit**Current
                liabilitiesChecks
                drawn in excess of bank balance
            
            $
            231,211Current
                portion of notes payable - banks
            
            
            68,534Current
                portion - motorcoach financing net of deferred guarantee
                costs
            
            
            475,061Current
                maturities of capitalized lease obligations
            
            
            686,684Notes
                payable - related parties
            
            
            1,204,524Notes
                payable - banks and credit card companies
            
            
            439,141Accounts
                payable
            
            
            228,534Payroll
                taxes payable
            
            
            732,836Accrued
                expenses
            
            
            235,270Customer
                deposits
            
            
            10,500Accrued
                salaries - officers
            
            
            194,400Total
                current liabilities
            
            
            4,506,695Long-term
                liabilitiesCapitalized
                lease obligations, net of current maturities & deferred refinance
                costs
            
            
            205,206Notes
                payable – banks
            
            
            163,185Motorcoach
                financing, net of current maturities & deferred guarantee
                costs
            
            
            2,790,020Due
                to stockholder
            
            
            298,970Total
                long-term liabilities
            
            
            3,457,381Total
                liabilities
            
            
            7,964,076Stockholders’
                deficitCommon
                stock, $.001 par value, 20,000,000 shares authorized, 13,800,000
                shares issued, 13,780,000 shares outstanding
            
            
            13,800Additional
                paid-in-capital
            
            
            1,675,700Retained
                deficit
            
            
            (3,694,998
            )Total
                paid-in capital and retained deficit
            
            
            (2,005,498
            )Less:
                Cost of treasury stock (20,000 shares)
            
            
            (2,000
            )Total
                stockholders' deficit
            
            
            (2,007,498
            )Total
                liabilities and stockholders’ deficit
            
            $
            5,956,578




The
      accompanying notes are an integral part of these financial
      statements.


2




**BESTWAY
      COACH EXPRESS INC.**


**STATEMENTS
      OF OPERATIONS**


**(UNAUDITED)**




For
                the nine months
            
            For
                the three monthsended
                August 31,
            
            ended
                August 31,2007
            
            2006
            
            2007
            
            2006Revenues
            
            $
            4,387,465
            
            $
            4,783,279
            
            $
            1,752,248
            
            $
            1,656,512Operating
                expenses
            
            
            3,936,537
            
            
            4,387,840
            
            
            1,441,188
            
            
            1,538,562Gross
                profit
            
            
            450,928
            
            
            395,439
            
            
            311,060
            
            
            117,950General
                and administrative expenses
            
            
            763,104
            
            
            783,350
            
            
            218,634
            
            
            267,224Income
                (Loss) from operations
            
            
            (312,176
            )
            
            (387,911
            )
            
            92,426
            
            
            (149,274
            )Other
                income (expense)Interest
                income
            
            
            28
            
            
            28
            
            
            -
            
            
            -Other
                income
            
            
            40
            
            
            10,320
            
            
            -
            
            
            -Interest
                expense
            
            
            (458,588
            )
            
            (432,212
            )
            
            (159,637
            )
            
            (154,799
            )Total
                other income (expense)
            
            
            (458,520
            )
            
            (421,864
            )
            
            (159,637
            )
            
            (154,799
            )Loss
                before provision for taxes
            
            
            (770,696
            )
            
            (809,775
            )
            
            (67,211
            )
            
            (304,073
            )Provision
                for income tax benefit (expense)
            
            
            (309,876
            )
            
            319,700
            
            
            (103,292
            )
            
            121,000Net
                loss
            
            $
            (1,080,572
            )
            $
            (490,075
            )
            $
            (170,503
            )
            $
            (183,073
            )Loss
                per share - basic and diluted
            
            $
            (0.08
            )
            $
            (0.04
            )
            $
            (0.01
            )
            $
            (0.01
            )Weighted
                average number of shares used to determine loss per share
            
            
            13,768,885
            
            
            13,680,000
            
            
            13,763,350
            
            
            13,680,000





The
      accompanying notes are an integral part of these financial
      statements.


3





**BESTWAY
      COACH EXPRESS INC.**


**STATEMENTS
      OF CASH FLOWS**


**(UNAUDITED)**




For
                the nine monthsended
                August 31,2007
            
            2006Cash
                flows from operating activities:Net
                loss
            
            $
            (1,080,572
            )
            $
            (490,075
            )Adjustment
                  to reconcile net loss to net cashprovided
                  by (used in) operating activities:Depreciation
                and amortization – fixed assets
            
            
            370,421
            
            
            406,397Amortization
                of deferred guarantee and refinance costs
            
            
            26,817
            
            
            26,817Deferred
                income taxes
            
            
            309,876
            
            
            (319,700
            )Consulting
                fees paid or payable with common stock
            
            
            87,500
            
            
            -Changes
                in operating assets and liabilities:Trade
                accounts receivable, net
            
            
            (113,765
            )
            
            17,878Fuel
                tax receivable
            
            
            (16,133
            )
            
            (20,682
            )Inventories
            
            
            30,793
            
            
            (20,706
            )Prepaid
                expenses
            
            
            8,174
            
            
            15,577Deposits
                and other assets
            
            
            -
            
            
            (1,460
            )Accounts
                payable
            
            
            (35,677
            )
            
            14,144Payable
                to banks and credit card companies
            
            
            1,819
            
            
            177,193Payroll
                taxes payable
            
            
            94,919
            
            
            311,858Accrued
                expenses
            
            
            97,188
            
            
            (13,896
            )Customer
                deposits
            
            
            9,350
            
            
            10,050Accrued
                salaries – officers
            
            
            25,400
            
            
            102,750Net
                cash provided by (used in) operating activities
            
            
            (183,890
            )
            
            216,145Cash
                flows from investing activities:Purchase
                of property and equipment
            
            
            -
            
            
            (43,376
            )Net
                cash used in investing activities
            
            
            -
            
            
            (43,376
            )Cash
                flows from financing activities:Checks
                drawn in excess of bank balance
            
            
            91,738
            
            
            94,468Principle
                payments on note payable - banks
            
            
            (172,206
            )
            
            (51,347
            )Proceeds
                from notes payable - related parties
            
            
            12,815,643
            
            
            981,201Payment
                of notes payable - related parties
            
            
            (12,188,873
            )
            
            (716,978
            )Proceeds
                received from due to stockholder
            
            
            290,536
            
            
            467,451Payment
                of due to stockholder
            
            
            (192,279
            )
            
            (436,189
            )Principal
                payments on motorcoach financing
            
            
            (182,153
            )
            
            (231,658
            )Repayment
                of capitalized lease obligations
            
            
            (240,444
            )
            
            (281,709
            )Net
                cash provided by (used in) financing activities
            
            
            221,962
            
            
            (174,761
            )Net
                increase (decrease) in cash and cash equivalents
            
            
            38,072
            
            
            (1,992
            )Cash
                and cash equivalents - beginning of period
            
            
            1,575
            
            
            7,706Cash
                and cash equivalents - end of period
            
            $
            39,647
            
            $
            5,714**Supplemental
                Information:**Cash
                paid for interest
            
            $
            370,778
            
            $
            408,196Cash
                paid for income taxes
            
            
            -
            
            
            -Noncash
                Investing and Financing Activities:Conversion
                of officer’s accrued salary to stock options
            
            $
            900,000
            
            $
            -Issuance
                of stock to satisfy liability for stock to be issued
            
            $
            75,000
            
            $
            -




The
        Company also restructured its capitalized motorcoach lease liabilities as
        disclosed in Note 4.




The
      accompanying notes are an integral part of these financial
      statements.


4


**BESTWAY
      COACH EXPRESS INC.**


**NOTES
      TO FINANCIAL STATEMENTS**


**NINE
      MONTHS ENDED AUGUST 31, 2007 AND 2006**


**(UNAUDITED)**





GENERAL:





The
      financial statements of Bestway Coach Express Inc. included herein, have been
      prepared pursuant to the rules and regulations of the Securities and Exchange
      Commission and in accordance with accounting principles generally accepted
      in
      the United States of America.





1.  CONDENSED
      INTERIM FINANCIAL STATEMENTS





The
      accompanying financial statements have been prepared by Bestway Coach Express
      Inc. without audit pursuant to the rules and regulations of the Securities
      and
      Exchange Commission. Certain information and footnote disclosures normally
      included in financial statements prepared in accordance with generally accepted
      accounting principles have been condensed or omitted as allowed by such rules
      and regulations, and management believes that the disclosures are adequate
      to
      make the information presented not misleading. These financial statements
      include all of the adjustments that, in the opinion of management, are necessary
      for a fair presentation of financial position and results of operations. All
      such adjustments are of a normal and recurring nature. The results of operations
      presented in the accompanying condensed financial statements for the period
      ended August 31, 2007, are not necessarily indicative of the operating results
      that may be expected for the full year ending November 30, 2007. These
      statements should be read in conjunction with the Company’s most recent annual
      financial statements for the year ended November 30, 2006, included in Form
      10-KSB filed with the U.S. Securities and Exchange Commission.





2.  SUMMARY
      OF SIGNIFICANT ACCOUNTING POLICIES





BUSINESS
      ACTIVITY





Bestway
      Coach Express Inc. (the “Company”) was incorporated on August 4, 1997, in New
      York State. The Company provides motorcoach transportation services. The
      majority of the Company’s revenues is derived from contracts with casinos to
      provide transportation services between Atlantic City, New Jersey, Connecticut,
      and New York City. The Company also provides charter services that are arranged
      by various tour agencies and via direct mail marketing campaigns directed at
      local schools, churches and civic associations.





The
      Company’s operations include a leased terminal and maintenance facility in
      Brooklyn, NY, a leased terminal in Long Island, NY, a leased apartment for
      motorcoach drivers in Philadelphia, and a leased administrative office in New
      York City. The Company is subject to regulation by the Department of
      Transportation (the “DOT”) and certain state regulations. The Surface
      Transportation Board and the Federal Highway Administration (the “FHWA”) can
      impose civil penalties upon companies for violations of applicable regulatory
      requirements. The FHWA may suspend, amend or revoke a company’s motorcoach
      operator’s registration for an operator’s substantial failure to comply with
      applicable regulations. Management believes that it has conducted its operations
      in substantial compliance with applicable regulations and does not believe
      that
      ongoing compliance with such regulations will require the Company to make
      substantial capital expenditures.





Of
      the
      Company’s fleet of 23 motorcoaches, one is owned by the Company, 11 are financed
      via capitalized leases with an initial term of seven years (which was extended
      to nine years - Note 4), and 11 are financed via a note payable with a term
      of
      seven years. The Company considers a motorcoach to be a “late model vehicle”
during its second seven years of operations.





5




**BESTWAY
      COACH EXPRESS INC.**


**NOTES
      TO FINANCIAL STATEMENTS**


**NINE
      MONTHS ENDED AUGUST 31, 2007 AND 2006**


**(UNAUDITED)**





2.  SUMMARY
      OF SIGNIFICANT ACCOUNTING POLICIES (Continued)





BUSINESS
      ACTIVITY (Continued)





The
      Company’s current liabilities exceeded its current assets by $4,039,171 at
      August 31, 2007. Continuing losses could endanger the Company’s viability as a
      going concern. However, management anticipates that revenues generated in 2006
      and 2007 will provide enough working capital to fund all operations for the
      remainder of its fiscal year ended November 30, 2007. In addition to increasing
      rates charged to customers, the Company launched a new interstate commuter
      service in 2006 (as described below) that is expected to increase revenues.
      The
      Company does not expect to incur the same non-cash losses in 2007 as it did
      in
      2006, and may defer payment of officers’ salaries and other related party
      liabilities in order to achieve cash flows from operations that will sustain
      the
      Company through 2007. Repairs and interest costs are also expected to decrease
      as a result of obtaining new motorcoaches.





In
      February 2006, the Company launched a new interstate commuter service. The
      Company now provides scheduled motorcoach service from a midtown location in
      New
      York City near Penn Station to a location in Philadelphia. The Company’s average
      monthly revenues and expenses during the first nine months ended August 31,
      2007
      were $80,000 and $71,000, respectively.





CASH
      AND
      CASH EQUIVALENTS





The
      Company considers all highly liquid investments with an original maturity date
      of six months or less when purchased to be cash equivalents.





INVENTORIES





Inventories
      consist of motorcoach replacement parts and diesel fuel. Inventory cost is
      stated at the lower of cost or market with costs determined using the average
      cost method.





PROPERTY
      AND EQUIPMENT





Property
      and equipment, including capitalized leases, are recorded at cost. Depreciation
      is recorded over the estimated useful lives of five (5) to ten (10) years.
      The
      Company principally uses the straight-line method of depreciation for financial
      reporting purposes and accelerated methods and useful lives for tax reporting
      purposes. Maintenance costs are expensed as incurred, and renewals and
      betterments are capitalized. The Company’s management continually evaluates
      whether circumstances have occurred that indicate that the remaining estimated
      useful lives of property and equipment may warrant revision or that the
      remaining balance may no longer be recoverable. Currently, management believes
      no impairment losses need to be recorded based on this evaluation.





6


**BESTWAY
      COACH EXPRESS INC.**


**NOTES
      TO FINANCIAL STATEMENTS**


**NINE
      MONTHS ENDED AUGUST 31, 2007 AND 2006**


**(UNAUDITED)**





2.  SUMMARY
      OF SIGNIFICANT ACCOUNTING POLICIES (Continued)





CONCENTRATION
      OF CREDIT RISK





The
      Company provides services within the New York City, New Jersey, Philadelphia,
      and Connecticut metropolitan areas. The Company’s accounts receivable consist
      primarily of receivables from casinos and various tour agencies. Management
      performs ongoing credit evaluations on customers and provides allowances for
      bad
      debts when considered necessary.





REVENUE
      RECOGNITION





Motorcoach
      revenues are derived from fees charged under contracts and other arrangements
      for motorcoach services. Services are provided both on a contracted and per
      seat
      basis. For contracted services, a rate is assessed that is generally on a daily
      or per mile basis, not dependent on passenger load factors. Fares for per seat
      services are usually determined by the Company and payment is received from
      individual passengers or through an independent commissioned agent. Currently,
      most of the Company’s revenues are derived through contracted
      services.





The
      financial statements are prepared based on the accrual method of accounting.
      The
      Company recognizes revenue when the service is provided. A liability for
      receipts from services sold but not yet earned is recorded as unredeemed
      services and included under the caption “Customer deposits” on the balance
      sheet.





INCOME
      TAXES





Income
      taxes are provided for under the liability method considering the tax effects
      of
      transactions reported in the financial statements, which are different from
      the
      tax return. Deferred income tax assets and liabilities represent the future
      tax
      consequences of those differences, which will be either taxable or deductible
      when the underlying assets or liabilities are recovered or settled.





EARNINGS
      (LOSS) PER SHARE





Basic
      income (loss) per common share (“EPS”) (“LPS”) is calculated by dividing net
      income (loss) by the weighted average number of common shares outstanding during
      the period. Diluted earnings per share is computed by dividing net income (loss)
      available to common shareholders by the weighted average number of common shares
      and common share equivalents during the periods presented, as long as such
      equivalents are not antidilutive. Due to net losses, stock options outstanding
      during the periods presented were not considered in the computation of LPS,
      as
      they would be antidilutive.





INSURANCE
      COVERAGE





The
      Company maintains comprehensive vehicle liability, general liability, workers’
compensation and property insurance to insure its assets and operations, with
      some claims subject to certain deductibles and no deductibles for other claims.
      The Company’s management continually evaluates the adequacy of its insurance and
      whether a reserve for outstanding claims, not covered by the Company’s present
      insurance coverage and when certain insurance deductibles are not met, is
      warranted.




7
 **BESTWAY
        COACH EXPRESS INC.**


**NOTES
      TO FINANCIAL STATEMENTS**


**NINE
      MONTHS ENDED AUGUST 31, 2007 AND 2006**


**(UNAUDITED)**





2.  SUMMARY
      OF SIGNIFICANT ACCOUNTING POLICIES (Continued)





ENVIRONMENTAL
      RESERVES





The
      Company’s operations are subject to various federal, state and local
      environmental laws and regulations governing vehicle emissions, above ground
      fuel tanks and the storage, use and disposal of hazardous materials and
      hazardous waste in connection with its in-house maintenance operations. These
      laws include the Water Pollution Control Act, the Clean Air Act, the Resource
      Conservation and Recovery Act, the Comprehensive Environmental Response,
      Compensation and Liability Act and various state and local laws.





The
      Company’s management continually evaluates whether circumstances have occurred
      that indicate that its maintenance facility could be identified for potential
      clean up and/or remediation work. On August 31, 2007, management determined
      that
      there were no existing or pending environmental liabilities.





USE
      OF
      ESTIMATES





The
      preparation of financial statements in conformity with generally accepted
      accounting principles requires management to make estimates and assumptions.
      These estimates and assumptions affect the reported amounts of assets and
      liabilities and disclosure of contingent assets and liabilities at the date
      of
      the financial statements and the reported amounts of revenues and expenses
      during the reporting period. Actual results could differ from these
      estimates.





Several
      areas require significant management estimates relating to uncertainties for
      which it is reasonably possible that there will be a material change in the
      near
      term. The more significant areas requiring the use of management estimates
      are
      related to the valuation of liability reserves and the useful lives for
      amortization and depreciation, as well as the realization of the tax benefits
      of
      net operating losses.





ADVERTISING
      COSTS





All
      costs
      associated with advertising and promoting the Company are expensed in the year
      incurred.




3.  SALARY
      ACCRUAL CONVERSION





On
      August
      31, 2007, the Board of Directors approved the conversion of the Company’s
      President’s salary totaling $900,000 accrued over the course of several years to
      stock options. In accordance with SFAS 123(R) and to determine the number of
      options the President was to receive, the options were valued using the Black
      Scholes Pricing Model. The options carry an exercise price of $.51 and are
      exercisable for a period of eight years commencing August 31, 2007. Expected
      volatility of approximately 73% is based on the historical volatility of the
      Company’s stock. The options granted were valued assuming a risk-free interest
      rate 4.46% per annum, and zero dividend yield and forfeiture rate. The valuation
      resulted in the issuance of 2,238,467 options, each valued at approximately
      $.40
      each.





4  MOTORCOACH
      LEASE RESTRUCTURE





Effective
      August 1, 2007, the Company restructured its outstanding lease obligations
      with
      its lessor. Pursuant to the restructure agreement, the terms of the leases have
      been extended two years from various expiration dates in 2007 to December 2009.
      The restructured lease obligation totals $412,585, comprised of $360,000
      principal and $52,585 interest. Based on 23 monthly payments of $13,355 with
      a
      balloon payment of $100,000 (the estimated residual value of the motorcoaches),
      interest is imputed as 8.4% per annum. Outstanding late fees approximating
      $52,000 previously recorded in accrued interest have been incorporated into
      the
      restructured lease obligation amount and monthly payments. The restructure
      resulted in a gain of approximately $10,000 that has been netted with current
      year interest for reporting purposes due to its minimal amount.




8




**ITEM
      2. MANAGEMENT’S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION**





*The
      following discussion should be read in conjunction with our unaudited financial
      statements and the notes thereto.*





***Forward-Looking
      Statements***





This
      quarterly report contains forward-looking statements relating to us that are
      based on the beliefs of our management as well as assumptions made by, and
      information currently available to, our management. When used in this report,
      the words "believe," "anticipate," "expect," "estimate," “intend,” “plan” and
      similar expressions, as they relate to us or our management, are intended to
      identify forward-looking statements. These statements appear in a number of
      places in this report and include statements regarding our intent, belief or
      current expectations and those of our directors or officers with respect to,
      among other things: (i) trends affecting our financial condition or results
      of
      operations, (ii) our business and growth strategies, and (iii) our financing
      plans. You are cautioned that any forward-looking statements are not guarantees
      of future performance and involve significant risks, uncertainties and
      assumptions, including among many others: a general economic downturn; a
      downturn in the securities markets; federal or state laws or regulations having
      an adverse effect on proposed transactions that we desire to effect; and other
      risks and uncertainties. Other factors that could adversely affect actual
      results and performance include, among others, the effect of tourism levels
      on
      our business, the rising price of insurance, government regulation,
      technological change and competition. All forward-looking statements
      attributable to us are expressly qualified in their entirety by the foregoing
      cautionary statement.





***Overview***





We
      were
      incorporated in New York on August 4, 1997. Our primary activity is to provide
      motorcoach services on both a contracted and per seat basis. Most of our
      revenues are derived through the provision of specialized destination route
      service, which is comprised of daily scheduled service to and from casinos
      in
      Connecticut and Atlantic City, and specified locations in Manhattan, Queens
      and
      Brooklyn. Tickets are sold through independent agents retained by the casinos
      and at specified locations. Customers are taken on an "open-door" basis or
      by
      reservation. From Monday through Thursday of each week, we have 17 roundtrip
      schedules to and from a casino in Connecticut and destinations around New York
      City. On Fridays through Sundays, we increase the number of our roundtrip
      schedules to the casino to 19. We provide 5 roundtrip schedules on Mondays
      through Thursdays from New York City to several Atlantic City, New Jersey
      casinos. We increase the number of roundtrip schedules to these Atlantic City
      casinos to 7 on Fridays through Sundays. Some of our motorcoaches make more
      than
      one roundtrip per day to and from the casinos that we serve.





During
      the years ended November 30, 2006 and 2005, approximately 4% and 10%,
      respectively, of our business came from providing motorcoaches for use by
      various travel agencies who organized tours to various destinations. We do
      not
      have any long-term contracts with these travel agencies and they book our
      motorcoaches for this purpose on an “as needed” basis. We get paid based upon
      the number of motorcoaches provided and the number of hours or mileage for
      which
      the motorcoaches are utilized. The tour business is seasonal with most bookings
      occurring during the summer months.





We
      also
      provide charter services at a fixed daily rate, based on mileage and hours
      of
      operation. We have informal arrangements with tour agencies to provide various
      levels of service and equipment for agent-sponsored and organized tours. Under
      these arrangements, we provide the motorcoach and driver at a fixed daily rate.
      On average, we charter about one motorcoach per day to third parties during
      the
      week and about 2-3 motorcoaches during the weekend.










For
      the
      most part, our special destination services and our charter services are
      provided on a contracted basis and not a per seat basis. Therefore, customer
      load factors generally do not materially affect our ability to generate
      revenues.





In
      February 2006, we launched our new interstate commuter service. We now provide
      scheduled motorcoach service from a midtown location in New York City near
      Penn
      Station to a location in center city, Philadelphia. Currently, we offer 18
      scheduled runs daily to and from New York and Philadelphia 7 days a week. **** Commuters
      can either purchase tickets at ticket booths located at each destination or
      purchase tickets on line.





During
      the nine months ended August 31, 2007, the new interstate commuter services
      generated approximately $718,167 in revenues and incurred approximately $640,000
      in expenses. We expect the revenues from the interstate commuter services to
      increase and the expenses to decrease until the service is
      normalized.





Management
      believes that this new interstate commuter service, if ultimately successful,
      could be a growth area for us. Management plans to closely review the
      contribution to earnings that this service provides to total earnings. If the
      contribution to earnings justifies it, then management may expand this service
      to other cities in the future.





The
      following table sets forth, for the periods presented, data regarding the total
      revenue and source of revenue earned by Bestway.





NINE
                MONTHS ENDEDAugust
                31, 2007
            
            August
                31, 2006Amount
            
            Percentage
            
            Amount
            
            PercentageCasinos
            
            $
            3,549,527
            
            
            81
            %
            $
            4,186,659
            
            
            87
            %Interstate
                Commuter
            
            
            718,167
            
            
            17
            %
            
            423,470
            
            
            9
            %Tours
            
            
            105,923
            
            
            2
            %
            
            172,539
            
            
            4
            %Other
            
            
            13,848
            
            
            <1
            %
            
            611
            
            
            <1
            %Total
            
            $
            4,387,465
            
            
            100
            %
            
            4,783,279
            
            
            100
            %





***Economic
      and Industry Wide Factors Relevant to Bestway***





Our
      business is seasonal in nature and generally follows the travel industry as
      a
      whole, with peaks during the summer months and the Thanksgiving and Christmas
      holiday periods. As a result, our operating cash flows are also seasonal with
      a
      disproportionate amount of our annual operating cash flows being generated
      during the peak travel periods. The day of the week on which certain holidays
      occur, the length of certain holiday periods, and the date on which certain
      holidays occur within the fiscal quarter, may also affect our quarterly results
      of operations.










One
      industry wide factor that is relevant to our business is that all of our
      customers, including our major customers, are “at will” customers. This means
      that customers can terminate our services at any time and without penalty.
      We
      have no written contracts with any customer.





In
      order
      to retain customers, therefore, we must provide reliable and professional
      service. Management believes that customer retention is due to the following
      factors:





·
            Reputation
                for passenger safety and providing efficient, on-time
                service;





·
            Maintaining
                long-standing relationships with the casinos and independent ticket
                agents
                that we serve;





·
            The
                preference of casino ticket agencies to maintain continuity of service
                with their current proven contractor rather than risk the uncertainty
                associated with a replacement.





***Material
      Risks, Trends and Uncertainties Affecting Bestway’s
      Business***





One
      of
      the material risks and uncertainties that faces our business is that some of
      the
      material costs of running our business are not fixed costs. The major costs
      that
      are not fixed costs are fuel expense and insurance costs.





Fuel
      is
      one of our most significant operating expenses. Fuel costs are subject to
      significant fluctuations due to economic factors. Fluctuations in the cost
      of
      fuel can have a significant impact on our operations and results of operations.
      Any sustained increase in fuel prices could adversely affect our results of
      operations.





In
      order
      to mitigate the rising cost of fuel, since January 2004 we have used a strategy
      of purchasing fuel whenever possible from those states in which we operate
      (Connecticut and New Jersey) where fuel costs are less than our operating base
      (NY). We have not employed any hedging strategies to assist us in mitigating
      the
      rising fuel costs and we have no current intention to do so. We are often able
      to pass on increased fuel expenses to our customers by increasing our rates.
      For
      example, we increased the rates that we charge to one of the casinos that we
      provide services to by 8% during the period from January 2004 to present and
      we
      raised the rates that we charge to two other casinos during the same period
      by
      15 to 28%. However, the market is very competitive and we are not certain that
      we will continue to be able to recoup increased fuel costs by passing them
      on to
      our customers.




Insurance
      costs in the motorcoach industry have increased significantly over the last
      few
      years and it has become increasingly difficult for us to find insurance at
      commercially reasonable rates. Annual rates of $21,000 per motorcoach are
      commonplace. During the past few years, insurers have been abandoning the New
      York market. Our current liability insurance and worker’s compensation insurance
      premiums increased more than 20% over the past few years. We cannot operate
      without insurance. In fiscal year 2006, we paid $609,168 in insurance premiums
      to insure our motorcoaches ($76,883 of which was for policies prepaid through
      various dates in 2007) and $91,086 in insurance premiums for worker’s
      compensation insurance. In fiscal year 2005, we paid $720,347 in insurance
      premiums to insure our motorcoaches and $79,052 in insurance premiums for
      worker’s compensation insurance. In 2004, we paid $475,851 in insurance premiums
      to insure our motorcoaches and $75,411 in insurance premiums for worker’s
      compensation insurance. At November 30, 2006 and 2005, we also owed $131,726
      and
      $80,475, respectively, for various insurance and worker’s compensation policies.
      Insurance costs continue to increase each year. The increase in insurance costs
      has negatively affected our cash flows. Furthermore, although we were able
      to
      obtain insurance for 2007 and 2006, the process for obtaining insurance was
      prolonged and we were rejected by some of the insurance companies that we
      applied to for insurance before being able to ultimately secure insurance.










Another
      trend or uncertainty affecting our business is the current state of the nation’s
      security. The U.S. Department of Homeland Security has implemented the Homeland
      Security Advisory System, which is designed to target our country’s protective
      measures when specific information to a specific sector or geographic region
      is
      received. The system combines threat information with vulnerability assessments
      and provides communications to public safety officials and the public. A
      color-coded threat level system was implemented to communicate with public
      safety officials and the public at-large.  Changes or increases in the
      threat condition has economic, physical, and psychological effects on the nation
      and can significantly affect our operations. We have noticed that our business
      will slow down when a higher alert status is issued by the Department of
      Homeland Security. We have also experienced cancellation of booked tours or
      other engagements as a result of an increase in the alert status issued by
      the
      Department of Homeland Security after a tour or other engagement was booked,
      but
      before the services were provided.





***Cost
      of Sales***





The
      principal elements of the costs of sales are labor, fuel, parts, vehicle
      insurance, equipment lease expense and rent. For the quarters ended August
      31,
      2007 and 2006, cost of sales approximated 82% and 93% of revenues, respectively.
      We spent approximately $363,342 and $349,225 on fuel in the quarters ending
      August 31, 2007 and 2006, respectively. ****





General
      and administrative expenses include costs associated with our headquarters
      in
      New York City, our Philadelphia commuter line, the Brooklyn terminal where
      we
      depot our motorcoaches, and managerial salaries. Management believes that it
      currently has sufficient staff to support anticipated revenue levels for fiscal
      year 2007. We anticipate that the increased general and administrative costs
      will be slightly offset if and when our business grows further and if we are
      able to effectively realize economies of scale by (i) spreading the cost of
      the
      administrative staff and facilities over a larger revenue base; and (ii)
      capturing savings in expenses such as vehicle insurance and vehicle parts and
      services.





***Operating
      Results***





***For
      Three Months Ended August 31, 2007 Compared To August 31, 2006
      (Unaudited)***





The
      following table summarizes the results of our operations during the fiscal
      quarters ended August 31, 2007 and 2006, and provides information regarding
      the
      dollar and percentage increase or (decrease) in the third fiscal quarter of
      2007
      compared to the third fiscal quarter of 2006.




**Three
                    Months Ended**
                
                **Dollar
                    increase**
                
                **Percentage
                    increase****Line
                    Item**
                
                **8/31/07**
                
                **8/31/06**
                
                **(decrease)**
                
                **(decrease)**Revenues
                
                
                1,752,248
                
                
                1,656,512
                
                
                95,736
                
                
                5.8
                %Net
                    loss
                
                
                (170,503
                )
                
                (183,073
                )
                
                (12,570
                )
                
                (6.9
                )%Operating
                    Expenses
                
                
                1,441,188
                
                
                1,538,562
                
                
                (97,374
                )
                
                (6.3
                )%General
                    and Administrative Expense
                
                
                218,634
                
                
                267,224
                
                
                (48,590
                )
                
                (18.2
                )%Interest
                    Expense
                
                
                159,637
                
                
                154,799
                
                
                4,838
                
                
                3.1
                %Loss
                    per common share
                
                
                (.01
                )
                
                (.01
                )
                
                -
                
                
                -









Total
      revenues during the third fiscal quarter of 2007 increased
      $95, 736
      or
      5.8%, to $1,752,248 as compared to $1,656,512 in the third fiscal quarter of
      2006. The increase in revenues was primarily due to an increase in revenues
      across the board; casino runs revenue increase of $49,187, interstate commuter
      revenue increase of $32,096 and tour income increase of $15,064. During the
      prior fiscal year, we were expending significant resources in order to launch
      our Philadelphia to NY interstate commuter run, thereby taking away
      revenue-producing resources from our casino and tour runs. Since the
      Philadelphia run has been progressively normalizing during the fiscal year
      2007,
      we not only have seen increased revenues from our Philadelphia run, but we
      have
      been able to refocus our resources back to our casino and tour runs, thereby
      increasing total revenues.





Operating
      expenses decreased $97,374 or 6.3% to $1,441,188; for the third fiscal quarter
      of 2007 as compared to $1,538,562 in the same quarter in 2006. The decrease
      is
      due to reduction of purchased spare parts of $29,203 and a decrease in the
      amount of outsourcing of $42,160 We limited the overall level of bookings during
      the high travel seasons to reduce our need to outsource services to other
      motorcoach service providers. Also, as a result of our newer fleet of
      motorcoaches we are able to reduce the level of repairs and maintenance and
      parts usage have decreased.





General
      and administrative expenses in the third fiscal quarter of 2007 decreased by
      $48,590, or 18.2 %, from $267,224 in the third fiscal quarter of 2006 compared
      to $218,634 in the third fiscal quarter of 2007. The decrease is mainly due
      to a
      reduction in the amount of advertising for our interstate commuter services
      for
      the Philadephia to NY run and a reduction of officers’ salaries in the amount of
      $34,250.





Interest
      expense in the third quarters of 2007 and 2006 were $159,637 and $154,799,
      respectively, resulting in a minimal increase of $4,838. Although we have
      refinanced certain debts over the years in order to attain lower interest rates,
      that decrease in interest has been offset by increases in late charges and
      other
      financing costs, resulting in consistent interest costs.





***For
      the Nine Months Ended August 31, 2007 compared to August 31,
      2006***





The
      following table summarizes the results of our operations from the financial
      statements:





Nine
                Months Ended August 31,**Line
                Item**
            
            **2007**
            
            **2006**
            
            **Dollar**
              **increase
                (decrease)**
            
            **Percentage
                increase (decrease)**Revenues
            
            
            4,387,465
            
            
            4,783,279
            
            
            (395,814
            )
            
            (8.3
            )%Net
                loss
            
            
            (1,080,572
            )
            
            (490,075
            )
            
            590,497
            
            
            120.5
            %Operating
                Expenses
            
            
            3,936,537
            
            
            4,387,840
            
            
            (451,303
            )
            
            (10.3
            )%General
                and Administrative Expense
            
            
            763,104
            
            
            783,350
            
            
            (20,246
            )
            
            (2.6
            )%Interest
                Expense
            
            
            458,588
            
            
            432,212
            
            
            26,376
            
            
            6.1
            %Loss
                per common share
            
            
            (.08
            )
            
            (.04
            )
            
            .04
            
            
            100
            %





For
      the
      nine months ended August 31, 2007 and 2006, our operating activities generated
      $4,387,465 and $4,783,279 in revenue, respectively. The decrease of $395,814
      in
      revenues was primarily due to a decrease in casino run revenue. The overall
      decrease in revenues is due primarily to bidding requirements implemented by
      casinos. This has increased competition to retain casino runs, which has caused
      us to either lose potential contracts to our competitors or a reduction in
      our
      fees. We are optimistic that we will retain our current clientele due to our
      customer service, competitive pricing, and newer model motorcoaches, and also
      continue to earn increased revenues from our Philadelphia run to compensate
      for
      any future competitive bidding issues.










For
      the
      nine months ended August 31, 2006 and 2005, we incurred $3,936,537 and
      $4,387,840 respectively, in operating expenses activities. This net decrease
      in
      operating expenses of $451,303 is attributable to a decrease in outsourcing
      in
      the amount of $116,618, a decrease in parts purchases in the amount of $45,508,
      and a general decrease in salaries pertaining to revenue decrease.  The
      decrease in outsourcing (i.e., the outsourcing of motorcoaches when ours are
      operating at full capacity) is due to our avoidance of over-booking tours and
      casino runs, especially on the weekends. The decrease in parts can be attributed
      to our newer motorcoaches, which do not require as much repairs and maintenances
      as later model vehicles.





For
      the
      nine months ended August 31, 2007 and 2006, our general and administrative
      expenses were $763,104 and $783,350 respectively. The net decrease in general
      and administrative expenses of $20,246 is primarily attributable to decreases
      in
      officers’ salaries.





Interest
      expense in the first three quarters of 2007 and 2006 were $458,588 and $432,212,
      respectively. The 6.1 % increase is due to a restructure of capital leases
      in
      August 2007, which required some up-front interest and finance charges.





***Liquidity
      and Capital Resources***





As
      of
      August 31, 2007, we had $39,647 in cash and cash equivalents, total current
      assets of $467,524 and a working capital deficit of $4,039,171. We (used)
      generated ($183,890) and $216,145 in cash flows from operating activities for
      the nine months ending August 31, 2007 and 2006, respectively.





We
      acquired 11 new MCI motorcoaches pursuant to a purchase agreement with MCI
      (Motor Coach Industries) that we entered into on May 24, 2005. Pursuant to
      the
      agreement, we are required to pay an aggregate purchase price of $4,211,000.
      We
      obtained financing for the purchase of these new motorcoaches through
      Caterpillar Financial Services Corporation. Under the terms of the financing
      arrangement, we paid an aggregate down payment of $165,000 and we financed
      the
      remaining $4,046,000. Under the terms of the financing arrangement, we are
      required to make a total of 84 monthly payments. The payments are in the
      approximate amount of $56,416 and we are required to make a final balloon
      payment of $809,200. The interest rate is 8.25% per annum.





The
      financing provided by Caterpillar Financial Services Corporation is secured
      by a
      second priority lien on the motorcoaches and is personally guaranteed by Wilson
      Cheng, our Chairman, Chief Executive Officer and controlling stockholder. In
      consideration for personally guaranteeing the financing for the acquisition
      of
      the motorcoaches, on June 5, 2005, we issued to Mr. Cheng 2,000,000 shares
      of
      our Common Stock.





The
      revenues that we generate through our operations are not currently sufficient
      to
      cover our working capital requirements. Unless we are able to renegotiate
      amounts owed to our trade and other creditors or engage in a capital raising
      transaction, we will not be able to continue as a going concern.










***Cash
      Flow Analysis***





**Nine
      months Ended August 31, 2007 Compared to August 31, 2006
      (Unaudited)**





The
      following table summarizes the statements of cash flows from the financial
      statements:





Nine
                months Ended August 31,2007
            
            2006Net
                Cash Provided By (Used In) Operating Activities
            
            
            (183,890
            )
            
            216,145Net
                Cash (Used in) Investing Activities
            
            
            -
            
            
            (43,376
            )Net
                Cash Provided By (Used In) Financing Activities
            
            
            221,962
            
            
            (174,761
            )Net
                Increase (Decrease) in Cash and Cash Equivalents
            
            
            38,072
            
            
            (1,992
            )Cash
                and Cash Equivalents - Beginning of Period
            
            
            1,575
            
            
            7,706Cash
                and Cash Equivalents - End of Period
            
            
            39,647
            
            
            5,714





For
      the
      nine months ended August 31, 2007 and 2006, our operating activities (used)
      generated ($183,890) and $216,145 in cash, respectively. This decrease of
      $400,035 in cash flows from operations is primarily attributable to a reduction
      in revenues of $395,814.. ****





For
      the
      nine months ended August 31, 2007 and 2006, we used $0 and $43,376,
      respectively, in investing activities. This is due to us purchasing fixed assets
      during 2006, but not in 2007.





For
      the
      nine months ended August 31, 2007 and 2006, we generated (used) $221,962 and
      ($174,761), respectively, in financing activities. The increase in cash flow
      provided by financing of $396,723 is primarily attributable to an increase
      in
      net proceeds from related parties and stockholders of $429,542. Fluctuations
      in
      payments on notes payable - banks, motorcoach financing, and capital lease
      obligations account for the remaining variance.





***Off
      Balance Sheet Arrangements***





We
      do not
      have any off balance sheet arrangements that have or are reasonably likely
      to
      have a current or future effect on our financial condition, changes in financial
      condition, revenues or expenses, results of operations, liquidity or capital
      expenditures or capital resources that is material to an investor in our
      securities.





***Seasonality***





Our
      business is seasonal. During the first and fourth quarters of our fiscal year
      we
      will usually break even or suffer a loss. We believe that business is slower
      in
      these months mostly because of colder weather and lower tourism during this
      period. During our second and third quarters, we usually are more profitable.
      Charter prices increase during this period due to greater demand **.**





***Inflation***





Our
      business, revenues and operating results are not affected in any material way
      by
      inflation.









***Critical
      Accounting Policies***





The
      Securities and Exchange Commission issued Financial Reporting Release No. 60, *"Cautionary
      Advice Regarding Disclosure About Critical Accounting Policies,"* suggesting
      that companies provide additional disclosure and commentary on their most
      critical accounting policies. In Financial Reporting Release No. 60, the
      Securities and Exchange Commission has defined the most critical accounting
      policies as the ones that are most important to the portrayal of a company's
      financial condition and operating results, and require management to make its
      most difficult and subjective judgments, often as a result of the need to make
      estimates of matters that are inherently uncertain. Based on this definition,
      we
      have identified the following significant policies as critical to the
      understanding of our financial statements.





·
            *Insurance
                Coverage*-
                We maintain comprehensive vehicle liability, general liability, workers’
                compensation and property insurance to insure our assets and operations,
                with some claims subject to certain deductibles and no deductibles
                for
                other claims. Our management continually evaluates the adequacy of
                our
                insurance and whether a reserve for outstanding claims, not covered
                by our
                present insurance coverage and when certain insurance deductibles
                are not
                met, is warranted.





·
            *Significant
                Estimates -*Several
                areas require significant management estimates relating to uncertainties
                for which it is reasonably possible that there will be a material
                change
                in the near term. The more significant areas requiring the use of
                management estimates are related to the valuation of liability reserves
                and the useful lives for amortization and depreciation, as well as
                the
                realization of the tax benefits of net operating
                losses.





**ITEMS
      3 AND 3A(T). CONTROLS AND PROCEDURES.**





***Disclosure
      Controls and Procedures***





We
      maintain disclosure controls and procedures (as defined in Rules 13a-15(e)
      under
      the Exchange Act) that are designed to ensure that information that would be
      required to be disclosed in Exchange Act reports is recorded, processed,
      summarized and reported within the time period specified in the SEC’s rules and
      forms, and that such information is accumulated and communicated to our
      management, including to the Chairman, CEO, and Treasurer, as appropriate,
      to
      allow timely decisions regarding required disclosure.





As
      required by Rule 13a-15 under the Exchange Act, our
      management, including Wilson Cheng, our Chairman, CEO and Treasurer,  evaluated
      the effectiveness of the design and operation of our disclosure controls and
      procedures as of August 31, 2007. Based
      on
      that evaluation, Mr. Cheng concluded that as of August 31, 2007, and as of
      the
      date that the evaluation of the effectiveness of our disclosure controls and
      procedures was completed, our disclosure controls and procedures were effective
      to satisfy the objectives for which they are intended.





***Internal
      Controls Over Financial Reporting***





During
      the quarter ended August 31, 2007, there
      were no changes in our internal controls over financial reporting identified
      in
      connection with the evaluation performed that occurred during the fiscal quarter
      covered by this report that has materially affected, or is reasonably likely
      to
      materially affect, our internal control over financial reporting.










**PART
      II - OTHER INFORMATION**





**ITEM
      1.**  **LEGAL
      PROCEEDINGS**





There
      are
      no pending legal proceedings by or against us and our property is not the
      subject of any pending legal proceedings.





**ITEM
      2.****UNREGISTERED
      SHARES OF EQUITY SECURITIES AND USE OF PROCEEDS**





None





**ITEM
      3. DEFAULTS UPON SENIOR SECURITIES.**





None.





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





No
      matters were submitted to our security holders during the quarter ending August
      31, 2007.





**ITEM
      5. OTHER INFORMATION.**





None.





**ITEM
      6. EXHIBITS .**





Exhibit
                Number
            
            Description31
            
            Certification
                of Principal Executive Officer and Principal Financial Officer filed
                pursuant to Section 302 of the Sarbanes-Oxley Act of
                2002.32
            
            Certification
                of Principal Executive Officer and Principal Financial Officer furnished
                pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section
                906 of
                the Sarbanes-Oxley Act of 2002.








**SIGNATURES**





In
      accordance with the requirements of the Exchange Act, the registrant caused
      this
      report to be signed on its behalf by the undersigned, thereunto duly authorized.





**BESTWAY
                COACH EXPRESS INC.**DATED:
                October 22, 2007
            /s/
                Wilson ChengWilson
                ChengChairman,
                Chief Executive Officer and
                Treasurer





**EXHIBIT
      INDEX**





Exhibit
              Number
            
            Description31
            
            Certification
                of Principal Executive Officer and Principal Financial Officer filed
                pursuant to Section 302 of the Sarbanes-Oxley Act of
                2002.32
            
            Certification
                of Principal Executive Officer and Principal Financial Officer furnished
                pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section
                906 of
                the Sarbanes-Oxley Act of 2002.