China Car Making Shifts Into Overdrive

LINDA O`BRYON: While the U.S. auto industry faces huge job cuts and plant closures, auto makers in China are hiring. The communist nation now exports over half of the cars and trucks it makes and its global market share is growing. Nick Mackie profiles China`s newest automaker.

NICK MACKIE, NIGHTLY BUSINESS REPORT CORRESPONDENT: Yin Mingshan can`t actually drive cars. But he`s determined to earn millions from making them. The Lifan 520 is his first model, a 1.6 liter sedan that sells for around $10,000. At full capacity, his Chongqing plant can produce a hundred thousand autos annually. With $100 million invested in the project, Mr. Yin this year plans to produce 20,000 cars, importing many of his engines from Brazil`s Tritec. Forty dealers in China will generate domestic sales. Overseas, there are distributors in Russia, Saudi Arabia, Iran, Albania and Nigeria, but not, as yet, in the United States.

YIN MINGSHAN (TRANSLATED): We know that in the U.S. and in Europe, that standards are higher than in China. In order for us to get Lifan`s foot in the U.S. and Europe and all over the world, we must focus on safety and environmental standards by improving our technology and our quality.

MACKIE: A stickler for standards made Mr. Yin China`s leading motorcycle maker, with sales in 2004 of $700 million, a third from exports to 74 countries. However, he recently lost a series of intellectual property disputes and had to pay Japan`s Honda over $200,000 in damages. Mr. Yin started out humbly in these old workshops just 14 years ago, aged 53. Denounced as a reactionary and imprisoned during China`s cultural revolution, he couldn`t forge a career until he was in his forties. After a decade of teaching, then running a state publishing house, he pooled $25,000 from family and friends and went into business. Now, encouraged by the communist party, Mr. Yin is set to join other domestic car makers like Geely and Chery for a place on the world`s forecourts. Mr. Yin`s base, Chongqing, seeks to emulate Detroit and become the car making capital of tomorrow. It already has 500 car and motorbike parts companies. Ford, Isuzu and Suzuki are here and the local government is investing heavily in infrastructure to attract others.

http://www.pbs.org/nbr/site/onair/transcripts/060309d/