Ford Cuts Mulally’s Compensation After Falling Short of 2012 Goals

2012 proved to be a mixed bag for automakers, with strong sales in North America and some emerging markets, but record losses and low sales in Europe. Unfortunately for Ford, the losses and issues in Europe kept the company from meeting its performance goals for the year. Ford CEO Alan Mulally’s 2012 compensation, while still generous by industry standards, was significantly lower than it was in 2011.

Mulally’s $2 million base salary remains unchanged from 2011, but his bonus was cut from $5.46 million in 2011 to $3.95 million in 2012. His other compensation, in the form of stock and options, went from $22 million in 2011 to $15 million for 2012. The compensation figures were disclosed in a regulatory filing and reported by Bloomberg.

Even with the cuts, Mulally’s compensation puts him at or near the top of automaker executive pay. Volkswagen CEO Martin Winterkorn received $18.9 million in compensation for 2012. Nissan/Renault CEO Carlos Ghosn got $10.3 million, and General Motors CEO Dan Akerson received $9 million in 2012, up from his 2011 compensation of $7.7 million.

However, viewed in the long-term from the investor standpoint, Mulally’s tenure as chief executive has been great for Ford stock, which was trading below $2 per share four years ago. Today, Ford stock is around $13 per share. Its 2012 performance out-paced the Standard & Poor’s 500 index, which posted a 13 percent annual gain. Ford stock rose 20 percent over the same period.

Source: Bloomberg

By Edward A. Sanchez

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