Ford CEO’s Total Pay Down 40% Last Year
Ford Motor Co. Chairman and Chief Executive Bill Ford received total compensation of $13.3 million in 2005, down 40% from the previous year after the automaker’s North American division lost more than $1 billion, according to a proxy statement filed Friday.
Bill Ford said last May that he would take no salary, bonus or other awards until the company’s automotive operations return to profitability. But he did receive nearly $5 million in restricted stock equivalents under an incentive plan established before he made that commitment. The executive plans to donate that amount to charity, the company said.
He also was granted 1.7 million stock options under a separate incentive plan. The value of those options was nearly $7.5 million when they were granted last year, but their value has probably fallen significantly since then, reflecting a decline in Ford’s share price.
The CEO took no cash salary in the first quarter of 2005, but did receive a restricted common stock grant valued at $372,043 for the period before he said he would accept no pay. He also was credited with $466,755 in compensation, including the value of his required use of the company airplane.
Ford, the great-grandson of company founder Henry Ford, received a compensation package valued at $22 million in 2004.
The automaker said Ford President and Chief Operating Officer Jim Padilla received a compensation package worth nearly $6.8 million in 2005, including a $1.5-million salary and a performance-based incentive award of restricted stock valued at $1.8 million.
Padilla, 59, said Thursday that he would step down July 1.
Strong competition, soaring healthcare and raw material costs and a slide in U.S. market share led the No. 2 U.S. automaker in January to announce a second restructuring of its North American operations in four years.
Ford Motor’s restructuring plan, dubbed “Way Forward,” is designed to reverse a $1.6-billion loss last year in its North American operations.
Globally, the company made $2 billion in 2005. Ford has announced plans to cut 30,000 jobs and close 14 plants as part of a restructuring.
The automaker also said in the proxy statement that shareholders would vote on 10 proposals at Ford’s annual meeting May 11 in Wilmington, Del., including one that would remove sexual orientation from Ford’s nondiscrimination policy and another that would tie executive compensation to progress in reducing greenhouse gas emissions from vehicles. Ford opposes both changes.
Shareholders probably will grill executives about the restructuring at the annual meeting, but the shareholder proposals in the proxy statement are unrelated to the turnaround plan. Ford said the proposal that seeks to remove sexual orientation from its nondiscrimination policy would hurt recruitment and sales.
Shares of Ford fell a nickel Friday to $7.60.
