You heard it right. Ford Motor Company and General Motors, 2 of the Big Three U.S. automakers, have confirmed that each of their CEO’s will accept a $1 salary in 2009 if their company accepts bailout money from the federal government. Ford also released a turnaround plan to Congress, the 1st of the Big Three U.S. automakers to do so, but critics contend that the details of the plan are not much different from what Ford told representatives of Congress less than a month ago.
Will it work? Taking a closer look at the details, accepting a $1 salary does not seem like that big of a deal. Ford’s CEO Alan Mulally had a base salary of $2 million in 2007 (but his total compensation was a whopping $21.7 million with stock incentives and other bonuses). GM’s CEO Rick Waggoner had a base salary of $1.6 million in 2007 (but his total compensation was a whopping $14.4 million with stock incentives and other bonuses). Even if these CEO’s get a fraction of their 2007 total compensation package, they should be just fine.
Ford and GM also announced plans to sell of their corporate jets in order to raise some capital for the struggling giants (last month the 3 heads were criticized for taking 3 separate private jets to Washington to testify in front of Congress). For meetings in Washington later this week, Mulally and Waggoner will drive in hybrid cars manufactured by each CEO’s company. Chrysler CEO Robert Nardelli will also refrain from using a corporate jet to get to Washington later this week.
Check out CNN Money’s Big Three Automaker Update for more details on the latest from Detroit and Washington.
