Lifan Yin Mingshan: Prisoners of the past

After two years of delay due to the financial turmoil, Chongqing Lifan Co., Ltd. (601777) listed on the domestic A-shares on November 25. This is a manufacturer of motorcycles, automotive engines and complete and general gasoline engines founded 18 years ago.

For Yin Mingshan, 72-year-old chairman of Lifan Group, this is a very moment. From early jail time to entrepreneurship, to opening up overseas markets and stepping into the auto industry, his story has condensed the twists and turns that Chinese private entrepreneurs may encounter. On the eve of the listing, he accepted an exclusive interview with the Southern Weekend reporter.

Yin Mingshan (Yu Li/Figure)

"I'm really a deputy provincial cadre?

Southern Weekend: Why should Lifan be listed?

Yin Mingshan: First of all, private enterprises have experienced painful financing difficulties. Generally, as of today, our enterprises are not as good as state-owned enterprises. After the IPO, I think that in the foreseeable (phase) period, that is, the first phase of the target (400 billion yuan, 500,000 vehicles), we can have no shortage of funds.

The greater advantage is that the modern enterprise system separates investors, managers and supervisors. Over the past year or so, I have gradually tasted the sweetness and gradually become more detached.

In the future, as a first step, I may not be the chairman of the board. Even the second step is not even necessary for the directors. Let my children be directors.

Southern Weekend: What does listing mean to you?

Yin Mingshan: I used to feel inferior because my family was not well-born. I later learned to be proud. Because I was very good at learning. I was later jailed and once again humbled. Now that my company is on the market, will it be proud again? I don't think so. After all, I have experienced too much. Prisoners from the previous ranks, and today's guests.

In politics, my section chief never acted as a deputy provincial cadre. In 2003, Yin Mingshan was elected vice chairman of Chongqing Municipal CPPCC and became the first private entrepreneur who entered the provincial leadership team since 1978. Editor's Note). At that time, when I wake up, I often get confused and do not know where I am or who I am. Am I really a sub-provincial cadre?

Economically, in 2001, I began to list on Forbes (China's billionaire list - editor's note), which is an earlier batch. Later, someone asked me an interesting question. “Did you dream of yourself becoming a billionaire in the future when you were in prison?” I immediately answered, no. When I was in prison, I also had a dream. I dreamed that when Chairman Mao forgives me, this dream has also come true. They do not forgive me nor have me today.

Going out is more than just exporting products

Southern Weekend: What do you rely on to attract investors?

Yin Mingshan: In 1992, we rented a small area of ​​more than 40 square meters. After 18 years of knocking, there are now 18 factories, 4 of which are abroad, Vietnam, Thailand, Turkey, and Ethiopia.

What is the biggest highlight of our attraction to investors? Innovation and go out. The thing I want to talk about most is the export. I'm going out.

Our export to the motorcycle industry is the first place. In the national car factory, we ranked ten to several, but the export ranked third.

No country can rely on a self-sufficient and closed economy to become a world power. It must rely on internationalization and globalization.

Southern Weekend: For what considerations, will you be going out to be the core strategy?

Yin Mingshan: The foreign market is bigger and the demand level is more abundant. There are more richer markets than China. Moreover, from the experience of Lifan, there is no ownership discrimination in foreign countries. Foreign countries do not ask whether you are state-owned or privately owned. For private enterprises, exports are more equitable than domestic sales. Another reason is that foreign export markets have higher profits than their home markets. The status quo of our factory is 40% of exports, 60% of domestic sales, profit can be opened on June 4th.

Going out will also require more efforts, such as the globalization of talent. We call Africans as our managers in African countries and Vietnamese as our manager in Vietnam.

There is also the globalization of capital. When we are borrowing from foreign banks, we cannot always use our capital in silly terms. There are also many benefits here. Interest rate differentials should be used well. Places with low interest rates can be used to raise money to places where interest rates are high, and purchases can make a fortune.

The worst way for Chinese companies to go out is after-sales service. What is the cause of this? It is caused by the planned economy. Without after-sales service, there will be no repeat customers. That is, "helplessly fall." With the after-sales service, it is "returning from the past."

We rushed overseas to prepare for the establishment of the factory early on. No country allows long-term input of foreign products, and capital output plus technical output can guarantee the output of products.

The other is to insist on independent brands. Our philosophy is to be a century old and insist on branding. In some countries, our brand awareness is even higher than in China.

Southern Weekend: On the way out, is there a time of failure?

Yin Mingshan: There have been failures. The biggest failure is to engage one's own people. I summed up a sentence as saying: "Only in a foreign land is a stranger, and I am most afraid of meeting other people in the country."

Chinese people are fighting outside the price war. They end up losing money and cutting corners, which seriously damage China's export reputation. Going vigorously and returning with enthusiasm.

Lifan can learn from Ford

Southern Weekend: What are the biggest variables you face in the future?

Yin Mingshan: The biggest variable is policy. In the past two years, the government's export tax rebates have been lowered and the RMB has appreciated by 20% for three years, making export companies miserable. The financial crisis has had such a big reaction in our country. It is actually our own problems that have erupted in that period of time.

In our revolution in China, I think the biggest problem from the perspective of epistemology is that there are too many utopias. Such as the Great Leap Forward, a day equals twenty years and fifteen years to catch up with Britain. This is Utopia.

Southern Weekend: There are many doubts about the successor issue. How do you respond?

Yin Mingshan: Ford is my role model. Ford has been able to continue for a couple of hundred years. Apart from its technical achievements, its system is also well-designed. Its family has talented people and is able to choose the chairman of the board of directors. If we feel that the family does not have talent, we will not mention it. this matter. Its equity system is very good. I think Lifan can learn from Ford.

Southern Weekend: Now that your family has more than 60% of Lifan's shares, do you have a timetable for gradually transferring some of your shares?

Yin Mingshan: I hope that the first phase can be reduced to 51%. In the second phase, I hope to reach 51% or less.

It is said that Li Ka-shing has only 25% of shares in Cheung Kong and Hutchison Whampoa. For example, Ford has a special design of 8%, and the Toyota family has only 2% of Toyota. So even if it is 2% it does not matter, but I still hope that it is the largest shareholder, at the same time, I also have requirements for investors, I hope not to change the brand of Lifan, do not change the name of the Lifan series.

The US "Business Weekly" reviews the world's top 100 brands every year. Until last year, China has not yet been selected as a brand. This is our tragedy as the world's second largest economy.