GM Changes CEO Pay Mix, Says He May Retire Within 3 Years

General Motors Co. (GM) Chief Executive Officer Dan Akerson’s compensation mix was changed in 2012 to accommodate the possibility he may retire before his long-term restricted stock vests in three years, the company said.

“We certainly wouldn’t speculate on what he will actually do -- that’s up to him,” Tom Henderson, a GM spokesman, said in a telephone interview.

Akerson’s compensation, which is subject to government review because of GM’s 2009 U.S. bailout, increased 44 percent to $11.1 million last year, the Detroit-based automaker said today in a regulatory filing. That includes $1.99 million in restricted stock units that were earned as part of his 2011 compensation package and granted in 2012, the filing said.

Under Akerson’s previous pay structure, about $2 million of his compensation was paid as restricted stock, which had been granted in the following year and took three years to vest, GM said in the filing. Stock units that haven’t been vested upon retirement may be forfeited. With the new system for 2012, he got that $2 million as salary stock units, which vest immediately and are paid out over three years.

Akerson, 64, is putting his stamp on the largest U.S. automaker, seeking to cement GM’s position as the best-selling foreign carmaker in China with the announcement last week that the company and its partners will invest $11 billion in the country through 2016. He’s also seeking to gain sales in the U.S. with the introduction of about 20 new vehicles this year after GM’s market share dropped to an 88-year-low in 2012.

$9 Million Target

Akerson received $1.7 million in salary and $9.4 million in stock awards and other compensation, the automaker said today in a regulatory filing.

The GM CEO’s compensation totaled $7.7 million in 2011 when his target was $9 million. Akerson replaced Ed Whitacre in the post in 2010 and led GM through its initial public offering that November.

“I wouldn’t be surprised” if Akerson departs within the three-year period, Joe Phillippi, principal of consulting firm AutoTrends Inc. in Andover, New Jersey, said in a telephone interview. “He stepped up when Ed surprised everybody” by leaving before the IPO.

GM Vice Chairman Steve Girsky, along with Mary Barra, the company’s top product-development executive, and Mark Reuss, head of its North American operations, are seen as possible CEO successors when Akerson leaves, people familiar with the thinking have said.

Trails Peers

While Akerson’s listed compensation for 2012 rose from 2011, GM says only the composition of his pay changed, in accordance with guidelines established by the U.S.

“His total compensation has not increased since joining the company in September 2010 and remains below the 10th percentile for executives in comparable positions due to the restrictions imposed by the special master, despite his significant contributions to operating performance and outstanding leadership,” GM said in the proxy.

Akerson’s pay trails many of his peers, including Ford Motor Co. (F) CEO Alan Mulally, who received about $21 million in compensation last year, according to Ford’s proxy. Mulally also received stock payments of $11.7 million last month, $58 million last year and $56 million the year before as part of his incentive plan.

Volkswagen AG (VOW), the largest European automaker, paid CEO Martin Winterkorn 14.5 million euros ($18.9 million), 17 percent less than in 2011. Nissan Motor Co. (7201) paid CEO Carlos Ghosn $10.3 million.

Toyota paid President Akio Toyoda 136 million yen ($1.43 million), according to data compiled by Bloomberg.

Sigtarp Criticism

Akerson’s compensation was criticized by the Special Inspector General for the Troubled Asset Relief Program in a January report that said the Treasury “failed to rein in excessive pay” at GM, American International Group Inc., and Ally Financial Inc. (ALLY), which were rescued by the U.S. government.

The U.S. Treasury is exiting its stake in GM through a series of sales that began in January. Executive pay restrictions can end once the Treasury sells off its remaining shares.

The Treasury said in December that it plans sell its entire GM holding within 15 months as the automaker bought $5.5 billion of its stock, or 200 million shares, from the government. As of April 1, the government’s stake had fallen to 16.4 percent, GM said in the filing.

GM rose 0.9 percent to $30.71 at the close in New York. The shares have gained 6.5 percent this year, while the Standard & Poor’s 500 Index increased 11 percent. GM’s 42 percent climb in 2012 was more than triple the S&P 500’s 13 percent rise.

To contact the reporter on this story: Tim Higgins in Southfield, Michigan, at thiggins21@bloomberg.net

To contact the editor responsible for this story: Jamie Butters at jbutters@bloomberg.net

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