Way Forward logic-bonus for going deeper into the hole
Ford Pays Chief $28 Million for 4 Months' Work
The Ford Motor Company paid its new chief executive, Alan R. Mulally, $28.18
million in his first four months on the job, the automaker said in a
regulatory filing yesterday.
His compensation included an $18.5 million bonus that Ford, which reported a
record $12.7 billion loss last year, disclosed in September when it hired
him from Boeing.
Figures in Ford's annual proxy statement show that his pay was more than
three times that of any other executive at the company. That includes the
executive chairman, William Clay Ford Jr., who has kept a 2005 promise not
to accept any new salary, bonus or stock awards until Ford consistently
earns a profit.
The second-highest pay, $8.67 million, was also for only a few months' work;
it went to James J. Padilla, who retired as president and chief operating
officer in July.
Three executives received bonuses for their roles in reducing manufacturing
capacity, cutting costs and achieving other goals as part of Ford's overhaul
plan, known as the Way Forward. The awards were part of a retention program
that the company recently abandoned.
Mark Fields, president of the Americas division, earned $2.29 million of his
$5.57 million in total compensation from that program. Lewis W. K. Booth,
executive vice president for Europe, received a $1.7 million retention
incentive, while Don R. Leclair, Ford's chief financial officer, received
Ford said it spent $517,560 to give Mr. Fields use of a company jet in 2006,
a perk he stopped using in January after it received considerable negative
publicity. Ford now buys first-class commercial airfares to fly Mr. Fields
from company offices in Dearborn, Mich., to his family's home in South
Florida each weekend.
Executive compensation at all three Detroit automakers has been closely
scrutinized since they began revamping plans that will close dozens of
factories and eliminate tens of thousands of jobs. They are trying to
overcome multibillion-dollar losses and compete better with foreign-based
rivals like Toyota and Honda.
This year, as the automakers negotiate a new labor agreement with the United
Automobile Workers union, workers are certain to resist demands for
concessions if they consider executive salaries to be excessive.
Union members have criticized the awarding of restricted stock option
bonuses to top executives at General Motors - although G.M. paid no cash
bonuses for the second consecutive year - and a proposal at Ford to pay
bonuses to executives there. Ford later announced a program to pay modest
bonuses of at least $300 to all employees.
Mr. Mulally earned a base salary of $666,667, or $2 million annualized. He
was granted a $7.5 million signing bonus and $11 million to make up for
bonuses and stock options he forfeited by leaving Boeing. Ford valued the
stock and option awards he received last year at $8.68 million.
In his final year at Boeing, where he headed the commercial airplanes
division, Mr. Mulally earned a total of $9.96 million.
"I have tried to live my life so that my family would love me and my friends
respect me. The others can do whatever the hell they please."