a trip to cuba where old american classics roll down the streets of havana. >> i haven't gone i wouldn't have known. >> reporter: what's in store for those who travel to cuba. >> it's the happiness of people, the gentleness and there's no rush. >> reporter: a look at what it takes to make one of those legendary cuban cigars as we go inside the oldest cigar factory in cuba. and the cuban home of one of

america's most celebrated authors. >> hemmingway should be preserved. >> it's all straight ahead. hello everyone i'm frank somerville and welcome to a second look. americans may soon find themselves traveling to cuba now that president obama has expressed intent to normalize relations with cuba. if you go there, it's like visiting a time when the american car was king. >> reporter: in cuba just getting around is a challenge. few people can afford automobiles here. particularly new ones. gasoline is expensive about $3.60 a gallon and rationed to about 5-gallons a month. bicyclists abound. so do chinese motorcycles with side cars. but public transportation would best be described as an

adventure. in havana we watched as a bus driver let 11 people on the bus then inexplicably shut the door to everyone else. this woman is waiting for a bus east of havana, watch her reaction when it actually shows up. so it's not surprising when a back of a truck becomes a bus. or you rely simply on old fashioned horsepower. and it's not surprising that if you have a car, even a gas guzzling american car from the 1940s and 50s you hang on to it. everywhere you go in cuba you find these legacies of a time when the united states was not a disposable society. built to last they have survived sun, salt air, and socialists revolution. they came here at a time when cuba and the united states were still on friendly terms. no one knows for sure how many there are, estimates run in the

thousands. some bare names still seen in the united states, ford, chevrolet, cadillac, but others carry labels as hard to find today in america as a cuban cigar. hudson,sudobacher. >> i have friends that would give their right arm to have one of these cars to restore. if i had never gone i would have never known. >> reporter: getting parts for these old beauties is a major challenge. alberto cantillo own this is 1954 chevy bell air. it can be described as nothing short of cherry. cantillo paid $3,500 for the car. money he saved from tips working among foreigners at the resort of valladero playa. cantillo says every part is stock from the factory. >> there's still a lot of

factory parts here that still exist. what we can't find we send for from the united states from relatives or friends. >> reporter: but not every cuban car owner has connections in the u.s. to supply factory parts. so people do what they can to keep their cars running. perhaps they modify a carburetor off a russian jeep. or turn a jar into a fuel filter. mario arencibia has a 49 chrysler. his has many parts that are not original factory equipment, he says sometimes you just have to find someone to make them. >> the machinists and the mechanics keep these things running because all these things are repaired by the machinests and the majority of the parts are made by the machinists. >> reporter: in the 1980s, the government tried to cap on the market. it offered to give any cuban a brand new russian latta in

exchange for that old american car. the government would then sell the american cars to foreign investors for cold hard cash. when the soviet union collapsed in 1991, the lata's became hard to come by. and the program all but disappeared. >> the government gets involved if i want to sell it to an american but between us cubans if a cuban wants to buy it from me i just sell it to them, no problem. >> reporter: but what happens if and when the united states drops its embargo and the two countries reestablish normal relations, cuba could become a gold mine for car collectors. some innovative cubans who were desperate to get out of the country used some of those old cars to try to get into the united states. in february of 2004 the coast guard intercepted an unusual vehicle off the coast of florida. it was actually a buick from the 1950s that had been turned into a boat.

11 cubans were using it in an effort to come to the united states. the coast guard captured the cubans and then sank the buick. two of the cubans had tried to make the same trip months earlier in a 1951 chevy truck they also modified so it would float. still to come here on a second look, making due with what they have. high priced food and a handmade bat. and a bit later rolling them by hand, a look at what it takes to make cuban cigars.

welcome back to a second look, for years cuba has been a popular tourist destination for the rest of the world. americans haven't been allowed to travel to cuba directly. but some found some round about ways to get there. in 1997, ktvu reporter craig heaps visited cuba and filed this report on what led to the initial resurgence of that

country's tourist industries. >> reporter: when the sun set on the soviet union in 1991 it looked like the beginning of a long economic night here in cuba. gone were $6 billion in economic aid. another billion dollars in military assistance. add to that a u.s. embargo designed to cut cuba off as much as possible from the rest of the trading world and it looked grim for the regime of fidel castro. >> we're suffering with our economy. we're trying to resolve those problems. but with the blockade the united states has against us i don't think we're going to be able to resolve that problem. >> reporter: the government rationed goods and urged cubans to produce more. cuba also expanded their tourist industry. what has evolved is a nation with two parallel economies, one based on human pesos for

the people who live here and one of foreign dollars for those who come and spend here. dollars are not allowed in this marketplace in havana, only pesos. >> no, it's not permitted to make that exchange here. this is a business owned by the state and the state insists on using cuban money when it deals to it people when it comes to the workers here. >> reporter: produce appears abundant. >> he says bananas here, cheap. nine pesos and he finds a buyer. meat is another story. you can find meat here but it's expensive. about .1 of a workers income for just one pound. even so the market was full and people were buying.

but a couple of blocks away a man says not everyone can afford the market. >> the cost is too much for most people. there are a lot of people that don't go there because their salary is too low. a little over 100 pesos for a piece of meat that costs $140 a pound you can't do it. the people who ran cuba before fidel castro took over owned businesses or were part of the government of flujencio bautista. many fled to florida where they now campaign for the overturn of castro. >> reporter: now several families share the space. flora sotolongo still remember it is old days. >> and how are things now? >> here we're living but i don't know how good it is.

>> reporter: however if you have dollars you can get most anything. >> reporter: the biggest source of dollars is tourism. despite the mafia run hotels and casinos that helped set the stage for the revolution, cuba has once again turned to foreign visitors for hard cash. last year almost 1 million foreigners came to cuban resorts and spent a report $1.3 million. this is the island's biggest resort center, guadadero beach 100 miles east of havana. >> for us at this time tourism is one of the most important things in this country. we are exploiting it to the maximum. >> reporter: near by new hotels are going up. most of the tourists come from europe or canada. >> castro has said it was a

great time, have a great time here. the people were lovely, it's nice. >> so is the price one canadian told us she paid, a $259 for a one week package that includes hotel, meals and air fare from toronto. >> it's the happiness of the people and the gentleness and there's no rush. there's no stress. at least there doesn't seem to be. >> reporter: the only thing you won't find at a beach resort like this is a lot of cubans other than the people who work here. and in that way, it's sort of an island within an island. away from the resort cubans are doing what they can to survive. delchuva is a teacher but supplements her income by selling handmade bags at this

market for tourists. >> this belongs to the government. we pay the state, we don't earn too much. it depends on how the day goes. >> reporter: other supplement their income in a way the state does not sanction. we heard reports of girls as young as 12 or 13 years old offering themselves as prostitutes. but for these boys outside havana a more innocent time. eight boys, three baseball gloves, and a board fashioned into a bat. cuba's future they have found a way to make due with what they have. perhaps symbolic of a nation that has done the same. near havana cuba i'm craig heaps and that's tonight's segment two. when we come back on a second look, almost 100 years old and still chugging on. this train gives tourists a look at cuba's once booming sugar industry.

and rolled by hand to very precise standards. where workers make those legendary cuban cigars.

welcome back to a second look. the fall in cuban relations is expected to bring much needed business to cuba. only eight of 56 mills were built after the 1959 revolution. and the most modern mill, it

was built 30 years ago. as lucia newman reported back in 2002, the problem is long- standing. >> reporter: it's called the hershey train, built in new york in 1917. same year that the hershey sugar mill which gives the electric train its name was built. the mill and refinery complex was built near santa cruz del norte cuba by the hershey family to provide the sugar for their chocolate. sugar was the driving force here until now. >> this train was used to take workers to and from the sugar mill. now it's being used to take tourists on a trip down memory lane to see what's next on an industry that was once king. the cien fuegos mill is now

silent. waiting just like many refineries around cuba to be turns into a museum. more than half the country's refinery mills were shut down a year ago. as the communists states struggles to restructure the industry on which cuban depended for century. >> i think the most difficult thing is the concept of such a big thing. it's such a transformation. >> reporter: a transformation the government can no longer postpone. world sugar prices are half what they were a decade ago and cuba's outdated and inefficient industry simply can't compete. the question is what to do next. >> obviously, it is not an after close mill. you have at the same time to make the remaining ones more efficient. state of art technology. >> reporter: that requires

foreign investment. an option the sugar minister does not rule out. most of the laid out workers will be reincorporated into other farming activities. the plan is to use most of the land previously maintains for cattle. 21,000 sugar workers are sent to study at the university. this is all a plan to turn the past into something profitable for the future. on a quiet street in old havana there's an old door way that leads to a cigar factory and inside skilled hands craft the most famous cigars in the

world. >> reporter: no cigar carry it is romance or reputation of a cuban cigar. no place has produced cuban cigars longer than the plastica cigar factory. a sign on the entrance says they've been in business in 1942. in which one presumes this is not the original building. >> no, there are no machines. the production here is completely by hand. why? because the assumption is a product like this is of higher quality. it has more value that way. >> reporter: between 200 and 400 cigar rollers work here every day. making more than two cuban pesos a month. the equivalent of 10 u.s.

dollars. they sit eight hours day, seven days a week putting the tobacco leaves together and wrapping it in a leaf. the rolled cigars are then squeezed in a hand cranked press. a good roller can turn out more than 100 cigars a day. once rollers reach a certain quota usually around 100 they get extra pay for every cigar after that. but quality counts just as much as quantity. every step of the way inspectors make sure the cigars are up to top cuban standards. >> they're weighing them, they're doing it in bundles of 50. they measure it by length and by width. if they find a defect, the worker does not get paid for

it. >> reporter: there are daily lessons in political or social indoctrination. today's lesson is on sexually transmitted diseases and impotence. to be a cigar roller is a proud profession. they bring in much needed hard currency for the cuban economy. every cigar produced in this factory is destined for export. >> our tobacco is far superior. they try to imitate us but it's far too difficult. they can dress it up but once you smoke it you can't fool somebody who knows their cigars. >> reporter: with all of these cuban cigars going out of the country what do the cubans themselves smoke? the ones made by the apprentices on the second floor. some day that will finish the

nine month program and move upstairs where they will send cigars to the world. a dilapidated store front or treasure?

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welcome back to a second look. tonight cuba where americans may soon wander the island as welcomed tourists. just 10 miles east of havana sits what was once ernest hemmingway's home. as hernando salinas reported, hemmingway's house got attention five years ago when a group sought donations to restore it. >> ernest hemmingway lived there through the 60s. he wrote for whom the bells toll. >> reporter: the look out farm is one of america's most

endangered places. the first site to be picked outside of the u.s. >> he left 10,000 library books, 3,000 photographs. scripts, he had markings on the walls in some. it really was two decades when he was at his happiest and most productive. >> reporter: the national trust is seeking permission from the u.s. government to restore the home. one cuban american politician says the property ties to fidel castro make the restoration project unacceptable. >> it's unbelievable that a u.s. organization would bypass u.s. buildings to restore and then go to fidel castro's cuba one of the world's richest tyrants and help him refurbish a tourist site where tourist dollars go to feed his dictatorship. >> reporter: teams have already been allowed to survey the home. the restoration would be a joint effort between americans and the cuban government and would require the bush

administration to ease the trade embargo. it's an endeavor supported by the cuban -- which says that fidel castro will pass away. >> it has to do with a figure which is importal in literature. >> since that report the house has been restored and opened to the public. a large trove of hemmingway's paper were found inside the home. 2,000 copies were transferred to john f. kennedy presidential library. among that material are letters to his wife, handwritten notes and bar bills. i'm frank somerville. see you again next week.

i'm mad for you, diane. roger's dating already? o.m.g. i wonder if she's younger than him. can you hold on a second? [ cellphone beeps ] lorraine how's my favorite client? i've been on something of a hot streak at work. i've tapped into a rich vein of new clients -- recently divorced moms. you might say i hit the single-mother lode. how about that master suite, huh?

maybe if i had someone to share it with. lorraine, you are a beautiful woman with a lot to offer. should we make an offer? it's a great house but i'm just gonna be alone. [ laughing ] diane you're not gonna be alone. you're gonna get a loan. sodas, snacks -- poker game's in the basement. look, i need more sleep than you and ever since they cut down that stupid prune tree the sun has been right in my eyes every morning. it's not a prune tree. they pruned the tree.