…is how much Ford’s new CEO Alan Mulally made in his first four months on the job. Do the math, that is a mere $28.8 million dollars. Must be nice considering Ford posted losses of $12.7 billion dollars last year!
Here is the full story from CNNMoney.com
Struggling Ford Motor Co., which posted a record $12.7 billion net loss in 2006, gave its new CEO Alan Mulally $28 million for four months on the job, according to the company’s proxy statement filed with the Securities and Exchange Commission Thursday.
The Ford (Charts) pay package for Mulally comes on top of the $7.4 million that aerospace company Boeing (Charts) had previously reported paying him for his eight months running that company’s commercial aircraft unit before he made the move to Ford at the beginning of September.
Mulally’s pay package at Ford included a $7.5 million hiring bonus, as well as $11 million that Ford described as an offset for forfeited performance and stock option awards at Boeing. In addition he received $55,469 for relocation costs and temporary housing.
His base salary was $666,667, which works out to annual pay of about $2 million. He also received restricted stock grants, which the company valued at $920,404, as well as 3 million stock options valued at $7.8 million. The stock options are not yet exercisable, and they have an exercise price of $8.28, or about 4 percent above current prices.
The details of the compensation packages and costs come as Ford moves ahead with plans to close plants and cut more than 30,000 hourly positions from the company in an effort to stem losses.
The company had disclosed in a footnote buried on page 228 of an earlier filing with SEC that Mulally saw the value of his stock bonuses increase to $6 million from the originally agreed upon $5 million “after reviewing the company’s 2006 performance results and Mr. Mulally’s leadership role in progressing his key priorities.”
The filing was made the day after Mulally was the keynote speaker at the start of the New York auto show.
Executive Chairman Bill Ford Jr., who had held the CEO post until Mulally was hired, had agreed in May 2005 not to receive any pay, bonus or stock grants until the company’s core automotive operations returned to profitability.
But the proxy listed Ford’s compensation for 2006 as $10.5 million, down 21 percent from $13.3 million listed in 2005. Most of that compensation for 2006 was the estimated value of earlier stock grants and options that vested and were recognized during the year, according to the filing. The great-grandson of the company’s founder had started as CEO of the company in 2001.
The proxy also discloses that Mark Fields, the head of Ford’s operations in the Americas, used company jets for personal travel at a cost to the company of $517,560 in 2006.
Ford executives’ use of corporate jets for personal travel cost the company almost $1 million in 2006, as Ford, Mulally and Jim Padilla, who retired as president and chief operating officer on July 1, were required to use the jets for all of their business and personal travel “for security reasons.”
An earlier filing by Ford had disclosed that Mulally can request that his wife, children and guests be able to use Ford corporate jets at company expense, even without him being on the flight. The proxy filing does not detail if that occurred during his time with the company in 2006.
Bill Ford’s personal use of the jets cost the company $185,232, while Mulally’s use cost the company $172,974 and the cost for Padilla was $82,265 for the six months he was with the company during the year.
Fields’s use of the jet to fly back and forth to see his family in Florida on weekends was part of his employment contract with the company. But it became a subject of controversy when it was first reported by a Detroit radio station in late 2006. At that time the company had only disclosed Fields use of the jet had cost it $214,479 in the last three months of 2005. In January, Fields announced he would fly commercial jets instead, at company expense.
The filing comes as Ford, General Motors (Charts) and DaimlerChrysler’s (Charts) Chrysler Group prepare to start negotiations with the United Auto Workers union to see concessions and labor cost savings when their current contracts end in September.
Ford, traditionally No. 2 in U.S. auto sales, could lose that long-held position to Toyota Motor (Charts) this year as the Japanese automaker opens plants here and gains market share as the traditional Big Three lose ground.
Ford announced in March that all full-time staff would receive some form of modest bonus for 2006, as it attempted to improve morale in the middle of a downsizing.
Most salaried workers and supervisors received between $300 to $800, depending on their location and rank in the company. Most union members received about $500. The company did not detail the overall cost of the bonus program, but the widespread bonuses cost the company at least $62 million, based on the 125,000 employees who were eligible for the payment.
Who thinks he’s(Alan Mulally) that pretty? Is it the other over payed people that think they are pretty, too? They all have bad eyes and no real since of value. Do they?
By Larry. July 31st, 2007 at 11:52 amAll I have to say is this, If Ford is dumb enough to pay that kind of salary then they deserve whats coming to them.
By Johnny. June 2nd, 2007 at 5:37 amAs far as american cars go im through with them. I own a 71 bronco (love it) 26 model T hot rod (love it) 79 f150 4×4 (love it)
04 mustang convet ( sold the piece of crap 5 months after buying it) my new car? a mazda3 5 door hands down funnest to drive out of all of them. cruises on the highway at 115 feels like your doing 80 and it was only 17K out the door!
american auto designers suck! foreign cars look and handle so much better
I am talking new cars of course, nothing beats pre 70’s american cars or trucks (can you say TANKS)
Hard to comprehend but this is what the market will bear. If he can turn the company around he will most likely get more at his next stop.
By Bruce L. McCaw. April 13th, 2007 at 12:15 pmAbout eight years ago I read an article that said “If minimum wage increased the same way CEO salaries have in the last twenty five years, minimum wage would be over $20 an hour. Are CEOs using the same negotiators as professional athletes? Look at what the CEOs of Toyota and Volkswagen make compared to their American counterparts and you will see another discrepancy.
By David Fischer. April 8th, 2007 at 8:32 amI think we all know that Ford will eventually perish with the way they’re running. Unless drastic changes happen. If we care for the average American LET US BUY CHEVYSS, TOYOTA, HONDA, etc. Never will I consider Ford product no more.
By Averageguy. April 7th, 2007 at 11:18 amAT that rate, I’d like to run Ford for two weeks please. Not greedy, that’s fix us up nice.
By ckelly. April 7th, 2007 at 9:34 amAt that rate, I’d like to run Ford for two weeks please. I’m not greedy, that’d fix us up nice.
By ckelly. April 7th, 2007 at 9:31 amI agree with most of the comments, what could one man possibly do to justify that kind of income?
Answer: nothing, it can’t be done. I mean if he never slept and constantly worked his ass off 24/7 there is no way he alone could do enough good to make me feel like “oh yeah that guy earns his paycheck, good job”.
No wonder the japs are kickin’ our a$$.
By Darren. April 6th, 2007 at 10:38 pmChina and Japan must be laughing all the way to the bank watching us Americans gift wrap and hand deliver our jobs and income to them. The sad part is the only thing they are doing to run the U.S car makers off is the same thing we did decades ago. Make a good product, sell it at a fair price, service it, and take care of your employees.
By 69rangerman. April 6th, 2007 at 6:52 pmChris it is not about you! Some people make a living by raping the common person of a American dream. They justify there big pay check by getting rid of the working man so they can fill there greedy ass pockets with cash ! Some day soon, the American worker will not be able to buy the rich mans goods. Than what ? Maybe the rich CEO will have to take a pay cut.
By Bob. April 6th, 2007 at 12:38 pmNo one is worth that much money, NO ONE. When Ford is loosing money and they are firing employees, how can any one man be worth that kind of money. And to think that $300-$500 bonuses will improve morale while Alan rakes in $28 miliion for 4 months of sitting on his $!@@$! is the biggest slap in the face of Ford employees.
By Ed. April 6th, 2007 at 10:08 amFYI Henry Ford is turning over in his grave for all the retards running his company
By torinoracer. April 6th, 2007 at 7:06 amIm not mad at the guy, in fact I applaud how he works the system. But I do plan to acheive my degree within the next few months and see if I can land a job with FORD. Personally, they need an enthusiast in that position with some education in running a business. None of these people have ever worked on a vehicle and therefore do not appreciate the hard work that goes into them. Im pretty sure that with some intuition, a couple of economic advisors that I know, dropping all the law suits pertaining to FORD Vs. X company for using the Mustang name, dropping Navistar, and asking what the enthusiasts want I could turn around that company. That is just my opinion but I really think they need to let some average joes get ahold of that organization.
By torinoracer. April 6th, 2007 at 7:04 amThis is the same BS as what is happening at universities. My President gets paid just about $1 million a year (she’s in the top 10 of highest paid presidents) and she has the nerve to raise tuition 7% next year even though my school has a new record for incoming freshmen and I already have to pay $48,000 a year. This ridiculous paying of CEOs to keep them at the company needs to stop. Sure the guy may help Ford in terms of sales but he’s also bleeding them dry by being their CEO. All of these arrogant ___holes need learn some modesty and take a pay cut before they decide to send thousands of their workers on the street.
By bassman97. April 6th, 2007 at 6:44 amIf you dont like rich people, do what I am doing, go to school start your own business and make as much money as you want. It is the American way. I do all this while being active duty in the Air Force and raising 2 kids by myself. We can’t be mad at a man for living the American dream.
By chris. April 6th, 2007 at 4:33 amCOME ON ! Give Alan some credit..he renamed the Five Hundred the “Taurus”. That should justify his pay checks.
By Bob. April 6th, 2007 at 2:16 amFunny how one guy that gets paid ~3000 times more than the workers, has the balls to lay of 30K of them. Here’s an idea, you’re already filthy stinking rich, why not take a pay cut to something more reasonable and allow an additional 3000 workers to keep their jobs and feed their families? Rich people piss me off.
By Motrhed. April 5th, 2007 at 10:11 pm