Ford Awards Mulally $58.3 Million in Stock for Turnaround
Ford Motor Co. (F) awarded Chief Executive Officer Alan Mulally $58.3 million in stock as a reward for the automaker’s turnaround.
Ford paid the stock to its top executive as part of an incentive plan for 2009, according to filings yesterday with the U.S. Securities and Exchange Commission. Ford earned $29.5 billion in the last three years after $30.1 billion in losses from 2006 through 2008. The shares, which traded as low as $1.01 on Nov. 20, 2008, closed yesterday in New York at $12.09.
Mulally will receive other compensation for 2011, including salary and benefits, which will be revealed in a proxy report in the coming weeks. Dearborn, Michigan-based Ford withheld some of the stock award to cover Mulally’s income taxes. After taxes, Mulally received $34.5 million in stock. Ford has awarded him stock worth more than $100 million the past two years.
“Our compensation philosophy is to align the interests of our leadership with those of our shareholders,” Todd Nissen, a spokesman, said yesterday in an e-mail. “Ford’s stock was $1.96 a share at the time of the 2009 awards, and is over $12 a share today. That is a more than a 500 percent increase, which benefits all stakeholders in the Ford turnaround.”
Last July, United Auto Workers President Bob King assailed Mulally’s compensation as “outrageous” and “excessive.” Last year, Ford rewarded Mulally with $56.6 million in stock. The executive’s 2010 compensation rose 48 percent to $26.5 million.
Options, Restricted Stock
In his new awards, Mulally, 66, also received 1.28 million stock options with a strike price of $12.46, which he can begin to exercise next year, and he was awarded 376,016 restricted stock units that can be converted into shares in 2014.
Executive Chairman Bill Ford, 54, received 595,238 stock options with a strike price of $12.46, the first of which he can exercise next year, and he was awarded 175,473 restricted stock units that can be converted into shares in 2014, according to a separate filing with the SEC.
General Motors Co. CEO Dan Akerson, whose pay must be approved by the Obama administration’s special pay master, said Jan. 10 that he won’t get a cash bonus for 2011, the year the Detroit-based automaker earned a record profit and again became the world’s largest.
Akerson, who served as CEO for four months in 2010, received $2.53 million in total compensation for that year, including a $566,667 salary and $1.96 million in stock awards and other pay, GM said in a proxy statement last year. His annual salary was $1.7 million, the filing said.
Other Auto CEOs
Sergio Marchionne, chief executive officer of Chrysler Group LLC, didn’t receive a cash salary or shares from the Auburn Hills, Michigan-based automaker, according to a company filing yesterday. Marchionne is also CEO of Fiat SpA (F), which owns 58.5 percent of Chrysler.
Volkswagen AG (VOW) Chief Executive Officer Martin Winterkorn was the highest paid CEO in Germany in 2010, with total compensation of 9.3 million euros ($12.2 million), a study from the DSW association for private investors showed.
Nissan Motor Co. Chief Executive Officer Carlos Ghosn received 982 million yen ($12.2 million) in total compensation for the 2010 fiscal year, including salary and stock options, making him the highest-paid leader among Japanese companies.
Toyota Motor Corp. (7203) President Akio Toyoda was paid 136 million yen in the year ended March 31, 2011, including a 24 million yen bonus, according to a filing last year to Japan’s finance ministry.
Ghosn’s pay was lower than the 2010 average for global automotive companies, estimated at about $15.3 million by Towers Watson & Co., a U.S. benefits consultant. Mulally’s 2010 compensation was the highest in the auto industry, the consultant said.
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