Must be nice ...

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Hoosier Daddy
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Must be nice ...

Post by Hoosier Daddy » Thu Apr 05, 2007 7:55 pm

Ford CEO: $28M for 4 months work

Former Boeing exec got $18.5 million bonus, almost $9 million in stock and options and base salary at annual $2 million rate, according to proxy.

April 5 2007: 6:31 PM EDT


NEW YORK (CNNMoney.com) --

Struggling Ford Motor Co., which posted a record $12.7 billion net loss in 2006, gave its new CEO Alan Mulally $28 million for four months on the job, according to the company's proxy statement filed with the Securities and Exchange Commission Thursday.

The Ford pay package for Mulally comes on top of the $7.4 million that aerospace company Boeing had previously reported paying him for his eight months running that company's commercial aircraft unit before he made the move to Ford at the beginning of September.

His base salary was $666,667, which works out to annual pay of about $2 million. He also received restricted stock grants, which the company valued at $920,404, as well as 3 million stock options valued at $7.8 million. The stock options are not yet exercisable, and they have an exercise price of $8.28, or about 4 percent above current prices.

The details of the compensation packages and costs come as Ford moves ahead with plans to close plants and cut more than 30,000 hourly positions from the company in an effort to stem losses.

The company had disclosed in a footnote buried on page 228 of an earlier filing with SEC that Mulally saw the value of his stock bonuses increase to $6 million from the originally agreed upon $5 million "after reviewing the company's 2006 performance results and Mr. Mulally's leadership role in progressing his key priorities."

The filing was made the day after Mulally was the keynote speaker at the start of the New York auto show.

Executive Chairman Bill Ford Jr., who had held the CEO post until Mulally was hired, had agreed in May 2005 not to receive any pay, bonus or stock grants until the company's core automotive operations returned to profitability.

But the proxy listed Ford's compensation for 2006 as $10.5 million, down 21 percent from $13.3 million listed in 2005. Most of that compensation for 2006 was the estimated value of earlier stock grants and options that vested and were recognized during the year, according to the filing. The great-grandson of the company's founder had started as CEO of the company in 2001.

The proxy also discloses that Mark Fields, the head of Ford's operations in the Americas, used company jets for personal travel at a cost to the company of $517,560 in 2006.

Ford executives' use of corporate jets for personal travel cost the company almost $1 million in 2006, as Ford, Mulally and Jim Padilla, who retired as president and chief operating officer on July 1, were required to use the jets for all of their business and personal travel "for security reasons."

An earlier filing by Ford had disclosed that Mulally can request that his wife, children and guests be able to use Ford corporate jets at company expense, even without him being on the flight. The proxy filing does not detail if that occurred during his time with the company in 2006.

The Ford family's $581 million loss

Bill Ford's personal use of the jets cost the company $185,232, while Mulally's use cost the company $172,974 and the cost for Padilla was $82,265 for the six months he was with the company during the year.

Fields's use of the jet to fly back and forth to see his family in Florida on weekends was part of his employment contract with the company. But it became a subject of controversy when it was first reported by a Detroit radio station in late 2006. At that time the company had only disclosed Fields use of the jet had cost it $214,479 in the last three months of 2005. In January, Fields announced he would fly commercial jets instead, at company expense.

The filing comes as Ford, General Motors and DaimlerChrysler's Chrysler Group prepare to start negotiations with the United Auto Workers union to see concessions and labor cost savings when their current contracts end in September.

Ford, traditionally No. 2 in U.S. auto sales, could lose that long-held position to Toyota Motor this year as the Japanese automaker opens plants here and gains market share as the traditional Big Three lose ground.

Ford announced in March that all full-time staff would receive some form of modest bonus for 2006, as it attempted to improve morale in the middle of a downsizing.

Most salaried workers and supervisors received between $300 to $800, depending on their location and rank in the company. Most union members received about $500. The company did not detail the overall cost of the bonus program, but the widespread bonuses cost the company at least $62 million, based on the 125,000 employees who were eligible for the payment.
Source: CNN.com

Two questions, just off the top of my head:

#1 - Is it any wonder these guys are in so much financial trouble? Hello? Bueller? Anyone?? Your BIG problem isn't the quality of your products, and it isn't the United Auto Workers. Get a mirror for the corporate boardroom. There you go.

#2 - Where is the exalted Free Market that should correct this abject stupidity, or does the free market only work to make the wealthy wealthier at the expense of everyone else?


Not trying to be political, I'm just sayin' .....

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Post by Zak Tyler » Fri Apr 06, 2007 6:23 am

buy American, buy a Honda.... LOL
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Post by Arp2 » Sun Apr 08, 2007 7:44 pm

Hoosier Daddy wrote:Two questions, just off the top of my head:

#1 - Is it any wonder these guys are in so much financial trouble? Hello? Bueller? Anyone?? Your BIG problem isn't the quality of your products, and it isn't the United Auto Workers.

It absolutely is. Look at the American industries where unions still have a strong presence -- cars, airlines, schools, and government; now, look at the output of each of those. Bad and declining even further, all of them. Quality of output gets worse with the introduction and presence of unions.

As has been said, GM and Ford are nothing more these days than retiree health care cooperatives temporarily kept alive by a little car-manufacturing business on the side. Union-built "American" cars start with labor costs $1200/car higher than non-union but are sold on the market for lower prices, largely based on the known lower value, quality, reliability, and resale. All can see that this model has been and is a loser.
Get a mirror for the corporate boardroom. There you go.
Well, that's true. The Fords should have told the unions to go penetrate themselves decades ago. Let this be a lesson to any industry that allows unions to get away with way-outside-of-the-marketplace-reality compensation, laziness, low-quality work, intimidation, and violence. The pendulum is simply swinging back toward reality and truth.
#2 - Where is the exalted Free Market that should correct this abject stupidity, or does the free market only work to make the wealthy wealthier at the expense of everyone else?
"Everyone else" being the company's shareholders, I presume? :roll: That's the only possible answer. All others have received their agreed-upon compensation.....and then some.

There's nothing to correct in this case. Mulally, the very successful head of Boeing's very successful commercial division (that's beating the crap out of the socialist-backed, supposed workers' paradise that is Airbus, by the way), was considered one of only a few men capable of even trying to turn this dog around and save it from death. To lure him away from the position at Boeing that he had succeeded in making comfortable and rewarding, Ford had to make its offer attractive enough for Mulally to make a change.

And, by the way, that's the same as it is for you, me, or anyone else. For us to be drawn to a new job, that job must have something of enough value to us.

And, like I said, Mulally is one of only a few considered capable of even trying to turn Ford around. 300,000,000 people in America....200,000,000 are capable of doing or quickly being trained to do the work done on the Ford assembly lines, but only a literal few are considered capable of doing what Mulally can do. Simple "supply and demand."
Not trying to be political, I'm just sayin' .....

:twisted: :twisted: :twisted:
False....you are very obviously repeating your union-assigned arguments for Communism as the left goes for its big push using "pretty," euphemistic language for the Communist tenets.

I'll say it again.....the frozen pizza plant ain't comin' back. And union rhetoric makes it unlikely anything will come near you ever again. The future of the world with its "global marketplace" is non-union, and everyone needs to realize that ideas, thinking, innovation, and the creation of experiences are the things of value in the present and future, not simple labor.

Even with that being the case, the American economy and job market continues to boom! Data and revisions released just this past Friday showed American businesses creating another 212,000 jobs, the unemployment rate at an astoundingly low 4.4%, and average wages up 4% year-over-year, comfortably well ahead of inflation!

This is, quite possibly, the greatest economic climate any of us will see in our lifetimes. It's time to "move on," both figuratively and literally.

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Must be nice

Post by Greg Goodfellow » Sun Apr 08, 2007 8:15 pm

If we do not develop and maintain a strong manufacturing infrastructure, all the ideas and innovation will do us no good. Corporations from other countries can simply buy the intellectual property we develop.

I just know I'm gonna regret posting this... :lol:
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Post by genlock » Sun Apr 08, 2007 8:36 pm

You are correct.
A strong, viable, profitable, manufacturing infrastructure.
I think you know what that means in a global economy. Ford must not think they are competing aginst only Chrysler, GM and Packard like they have done in the past. Individual workers are competeing aginst workers around the world. Unions do not understand any of this as they are generally a socialist entity. India is complaining that they have run out of qualified people for all of the jobs outsourced to India. Union excesses have destroyed major segments of American basic industries.

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Re: Must be nice

Post by Arp2 » Sun Apr 08, 2007 9:24 pm

Greg Goodfellow wrote:Corporations from other countries can simply buy the intellectual property we develop.
Yes, that's the point.

Labor, as a commodity, is becoming worth very little, so it is definitely in our interest to be about doing the things that have a much greater value.





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Post by AmpedNow » Mon Apr 09, 2007 2:43 am

Hoosier Daddy wrote:Get a mirror for the corporate boardroom. There you go.
All of the problems plaguing the American auto industry aside, there are other reasons behind the Asian success.

One thing that is not considered are the major differences in the cultures. Asians are far more collectivist, and care about what others think.

Most of the Asian auto makers, Toyota included, are still family-owned and operated. They make corporate decisions as collective, caring families and really care about how their customers and dealers will be affected.

Contrast that with how the American auto companies are ran: decisions are made in cold, stiff, emotionless boardrooms with customer consideration being the least of their worries.

Humility and humbleness are also a part of Asian culture. When Toyota soon overtakes GM as the world's largest automaker, you won't hear them gloat about it and rub GM's nose in their success. In fact, you won't hear them say anything. It will be business as usual for them, because in their home country, boasting about one's success is shameful. In fact, I read a story on Drudge a few weeks ago that Toyota is seriously worried about an American backlash against them after they surpass GM. They are already going into "humility" mode.

Again, contrast that with the pride and arrogance the Big 3 have had for many years, and still have too much of. They know what's best for us. They know what we want. They balk every time the government raises fuel/emissions standards on them, while the Asian companies roll with the punches and quickly develop new technology that meets and exceeds the new standards. Meanwhile, the Big 3 are still in Washington arguing with the government about the new standards...

The union/nonunion issues only scratch the surface... The differences in the American/Asian corporate cultures play a part, too.

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Post by Big Media » Mon Apr 09, 2007 8:57 am

Excellent post, K-.

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Post by Dave Allen » Mon Apr 09, 2007 9:12 am

As consumers we learn from our personal experiences, as well. I would love to by GM/Ford/Chrysler vehicles, however in my experience U.S> manufacturers can't hold a candle to Japanese cars. We just bought a '92 Camry for my wife to drive to work from Logan to Charleston everyday. The car has 139,000 miles on it. Would I have even thought about buying a GM car for example with comperable mileage and trust it to get her to Charleston and back from Logan every day? Probably not. I have three Toyotas, a 92 Camry, '04 Tacoma and an '07 Camry sitting in my driveaway right now. Of course some of thay may be because her brother sells them. We also had great luck with her Honda Accord, too.
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Post by Lester » Mon Apr 09, 2007 9:30 am

K-Rock wrote:Humility and humbleness are also a part of Asian culture. When Toyota soon overtakes GM as the world's largest automaker, you won't hear them gloat about it and rub GM's nose in their success.
To add to this, and union bash a bit... I remember when my Uncle's union decided to purchase a brand-new Japanese sports car, have it run through the car crusher, and ship it back to Japan. There's a good use of union dues right there... and while Nissan still makes cars, is Armaco even open anymore?
K-Rock wrote:Again, contrast that with the pride and arrogance the Big 3 have had for many years, and still have too much of. They know what's best for us. They know what we want.
Sound like McRadio. :-)
K-Rock wrote:The union/nonunion issues only scratch the surface... The differences in the American/Asian corporate cultures play a part, too.
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