PAYDAY: GM's Rick Wagoner Drives Away with $20M Retirement
Critic Calls Multi-Million Package "Perfect Example" of Frustration with
By MICHELLE LEDER and JUSTIN ROOD
March 30, 2009—
Rick Wagoner will leave his post as CEO of bailed-out General Motors
with a $20 million retirement package, the company's financial filings show.
Although the Treasury Department has barred GM from paying severance to
Wagoner or any other senior executive, Wagoner is eligible to collect
millions in retirement benefits from his former employer, according to
the documents reviewed by ABC News.
The Obama administration asked for Wagoner to resign Sunday, as part of
its restructuring of the auto industry. President Obama said this
morning that forcing Wagoner out indicated it was a time for new leadership.
Under Wagoner's leadership, GM lost tens of billions of dollars, took
billions in taxpayer-financed aid, and cut tens of thousands of jobs,
including announced plans to cut 47,000 employees by the end of 2009.
Wagoner's Private Jet Trip to Washington
Wagoner was one of the three auto industry CEOs who inflamed
Congressional ire by flying to Washington in private jets to ask for
taxpayers to bail out their beleaguered businesses. They returned a
month later in hybrid cars.
Upon his departure, Wagoner becomes eligible for both a "Salaried
Retirement Plan" and an "Executive Retirement Plan" with General Motors.
The combined value of the plans at the end of last year was $20.2
million, according to the company's filings with the SEC, although
compensation experts said his age -- 56 -- may make him ineligible for
the entire amount.
"Most of that will be paid out as an annuity over five years, the
remainder is a small lifetime annuity," GM spokeswoman Julie M. Gibson
said in an email earlier today. But in a subsequent "clarification"
email after this story published, Gibson said that the terms of
Wagoner's final compensation were not yet hammered out. "Specifics on
any compensation entitled to, or actually paid to Mr. Wagoner are still
being reviewed," she wrote.
"I think it's another perfect example of why there's so much frustration
among working people," said Tiffany Ten Eyck of Labor Notes, a
Detroit-based independent publication covering unions. "I wouldn't mind
retiring out of an industry in crisis with a $20 million package."
GM has received billions in loans from the U.S. Treasury Department, and
recently asked for billions more. Under its agreement with Treasury, it
cannot pay severance fees to senior executives. That ban does not appear
to apply to retirement benefits, however.
After Wagoner's Private Jet Trip to DC, GM Sells Luxury Fleet
Wagoner began his career at GM in 1977, working as an analyst for its
New York treasurer's office. Wagoner was promoted to several positions
within the company, including managerial roles in Europe and South
America, before being named CEO in 2000.
Wagoner received compensation topping $63 million during his tenure as a
GM executive from 1992 through 2008, according to an analysis of company
data by compensation analysts Equilar, Inc.
Last November, ABC News cameras spotted Wagoner in Washington, D.C.
arriving on GM's $36 million luxury aircraft. He had come to the
nation's capital to tell members of Congress that the company was
burning through cash, and needed over $10 billion in U.S. taxpayer funds
to stay afloat.
In a followup visit to Washington in December, Wagoner arrived in a
Chevy Malibu hybrid. GM announced plans to sell its corporate luxury jet
fleet that same month.