Ford Increased Mulally’s Pay 5.3% to $17.9 Million
By Keith Naughton
Bloomberg
March 22 (Bloomberg) -- Ford Motor Co. raised Chief Executive Officer Alan Mulally’s 2009 compensation 5.3 percent to $17.9 million as the automaker returned to profit and avoided the bankruptcies that befell its U.S. competitors.
He received $1.4 million in salary and $16.5 million in stock, option awards and other compensation, the Dearborn, Michigan-based company said today in a regulatory filing. For 2008, Mulally’s total was valued at $17 million, including $2 million in salary and no bonus.
Ford posted net income of $2.72 billion in 2009 and its share price surged more than fourfold as it gained U.S. market share for the first time since 1995. Mulally, who joined Ford in 2006 from Boeing Co., halted three years of annual losses.
“He’s earned his money,” said Joseph Phillippi, president of AutoTrends Consulting in Short Hills, New Jersey. “Last year was really horrible and he successfully led the company through it, improving market share and introducing terrific new products that give Ford great momentum.”
Ford borrowed $23.4 billion in late 2006 after Mulally, 64, took over as CEO, putting up assets including its blue oval logo as collateral. That helped the automaker stay out of bankruptcy last year as the predecessors of General Motors Co. and Chrysler Group LLC sought court protection and reorganized with U.S. aid.
The company said in the filing that it achieved 90 percent to 97 percent of its 2009 performance targets for pretax profit, cash flow, cost cuts, market share and vehicle quality.
Pay Cuts
To win concessions from the United Auto Workers union last year, Mulally and Executive Chairman Bill Ford agreed to 30 percent cuts in their 2009 and 2010 salaries and to forgo bonuses for 2008 and 2009. No Ford salaried employees, including executives, got a cash bonus last year.
Bill Ford’s delayed compensation for last year was $16.8 million. He will get that when Ford achieves automotive profitability for a full year.
In December, a month after the UAW rejected a second round of concessions, Ford told salaried employees it would reinstate raises, 401(k) retirement-fund matches and tuition aid this year as business improves.
The automaker’s U.S. market share rose to 16.1 percent last year from 15 percent in 2008, according to Autodata Corp.
In February, Ford surpassed GM as the top-selling automaker in the U.S. for the first month since 1998.
Small Cars, Job Cuts
Mulally has focused on improving vehicles at Ford’s namesake brand, including adding fuel-efficient small cars such as the Fiesta, and cutting costs.
He also has reduced the North American workforce by about 47 percent since 2006 and sold the Jaguar, Land Rover and Aston Martin luxury brands. Ford has said it expects sign an agreement to sell Volvo to China’s Zhejiang Geely Holding Group Co. by the end of this month.
Ford rose 70 cents, or 5.3 percent, to $13.99 at 4:15 p.m. in New York Stock Exchange composite trading. The shares have gained 40 percent this year. They climbed to $10 in 2009 from $2.29 at the end of the previous year.
Chief Financial Officer Lewis Booth received $3.83 million in total compensation for 2009, down 30 percent from a year earlier, the company said. That included a $1.2 million salary $1.11 million in stock options and other share-based awards.
Mark Fields, the company’s president of the Americas, got total compensation of $3.98 million, a 14 percent drop from 2008, Ford said. He was paid a salary of $1.3 million as well as $1.37 million in stock options and other share-based awards.
The company plans to hold its annual shareholders meeting May 13 in Wilmington, Delaware.
To contact the reporter on this story: Keith Naughton in Southfield, Michigan at Knaughton3@bloomberg.net
Source: Bloomberg
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