DETROIT (Reuters) - Ford Motor Co <F.N> reported on Friday that Chief Executive Alan Mulally earned more than $22 million in 2007, citing progress in revamping both the strategy and structure of the struggling No. 2 U.S. automaker.
By Kevin Krolicki and David Bailey
DETROIT (Reuters) - Ford Motor Co <F.N> reported on Friday that Chief Executive Alan Mulally earned more than $22 million in 2007, citing progress in revamping both the strategy and structure of the struggling No. 2 U.S. automaker.
The compensation to Mulally and other executives drew sharp and immediate criticism from United Auto Workers President Ron Gettelfinger, who called the payments "excessive and unjustified" given sacrifices the union's members agreed to make in the 2007 contract.
"We did not sacrifice so that management could find a way to reward themselves with higher compensation," Gettelfinger said in a statement.
!ADVERTISEMENT!Ford, which lost $2.7 billion in 2007 and is targeting a return to profitability in 2009, noted Mulally had steered through a new four-year contract with the UAW that will allow it to hire new workers at lower wages as part of its reason for his pay package.
Last month, Ford said it would pay bonuses to all employees in North America, including hourly workers who received $1,000 payouts.
In a statement issued with its annual report, Ford said Mulally's pay for 2007 was $22.75 million, including grants of stock-based compensation and a $7 million bonus.
That compared with $39 million in total compensation Mulally was paid in 2006, when he was hired away from Boeing Co <BA.N> and received a signing bonus.
Ford paid Chief Financial Officer Don LeClair $12.7 million, including a $3 million bonus. Mark Fields, the head of Ford's operations in the Americas and a candidate to succeed Mulally, was paid $14.2 million.
In its proxy filed with securities regulators, the compensation committee of Ford's board detailed its justification for Mulally's pay.
The board cited Ford's progress in narrowing its annual loss by $10 billion in 2007 and positive cash flow for its core auto operations, results it said were better than expected.
Mulally was also credited by the board with building "an effective executive team" and "improved operational effectiveness." He hired away former Toyota Motor Co <7203.T><TM.N> executive Jim Farley to head up Ford's global marketing efforts.
Analysts said Mulally has taken steps to shake up the corporate culture at Ford and unify operations that had been sharply divided by geography.
Along with other major automakers, Ford has been hit hard by the downturn in the U.S. market since last year and is targeting a return to profitability in 2009.
Ford Executive Chairman Bill Ford Jr., who stepped down as CEO after he hired Mulally in 2006, could also be paid for his work in 2008 after foregoing compensation since 2005, the automaker has said.
The board has said Bill Ford will not receive any compensation, including any payouts for 2008, until the company hits its turnaround target of returning auto operations to full-year profitability.
(Editing by Jeffrey Benkoe/Andre Grenon)
