Ford Motor Company payout

**Yooper** · March-08-11, 02:28 PM

DEARBORN, Mich. [[AP) -- Ford Motor Co., which turned its biggest profit in more than a decade last year, has rewarded CEO Alan Mulally with stock worth $56.5 million before taxes.

The man who hired Mulally, Executive Chairman Bill Ford Jr., also got stock worth $42.4 million.

The Dearborn, Michigan, company disclosed the stock in filings Monday with the U.S. Securities and Exchange Commission, and the shares were granted to the men on Thursday, when they closed at $14.76. Several other top executives also received stock awards.

Ford was in financial peril late in 2006 when Bill Ford removed himself as CEO and hired Mulally away from aviation giant Boeing Co. Under Mulally, the company mortgaged its assets to borrow more than $23 billion, allowing it to weather the recession. It avoided filing for bankruptcy or following General Motors Co. and Chrysler Group LLC in taking government aid.

Mulally is widely credited with turning the company around, raising the quality of its cars and trucks and shifting its model lineup from trucks and sport utility vehicles to smaller vehicles such as crossovers.

In 2006, the year Mulally was hired, Ford lost $12.6 billion. But last year the company made $6.6 billion, its best year since 1999, and sales were up almost 20 percent.

Ford spokesman John Stoll said the stock awards were part of compensation packages that were disclosed in filings from previous years. "We align executive compensation to company performance and long-term shareholder value," Stoll said.

Ford's stock in January closed at a five-year high of $18.79 after falling to as low as $1.43 in 2008, when the future of Ford and its Detroit rivals was uncertain.

But the shares have since fallen to around $14 after Ford announced fourth-quarter earnings that fell short of Wall Street expectations and gas prices started to rise due to turmoil in the Middle East.

Mulally received 3.8 million shares worth $14.76 each on Thursday, according to the filing. But the company withheld 1.56 million shares worth $23 million to pay taxes on the stock award, giving Mulally a net award worth about $33.4 million.

Bill Ford got 2.87 million shares worth $14.76 each, and the company withheld 1.17 million shares to pay $17.3 million in taxes, giving him a net stock award valued at $25 million.

Mulally also will get another 543,734 shares as of March 3, 2013, and he has options to buy another 884,433 shares over the next 10 years at $14.76 each. But those options now are worthless because he can buy the stock for less on the open market. Ford stock closed Monday at $14.01.

Bill Ford also will get another 253,742 shares in March of 2013, and he has options to buy another 412,735 shares at $14.76 over the next 10 years. Like Mulally's options, those also are now worthless because the option price is higher than Ford's trading price.

Looks like Detroit is back on track!

**Johnnny5** · March-08-11, 03:13 PM

Originally Posted by Yooper

Looks like Detroit is back on track!

Sorry for sounding pessimistic, but over the last few years the percentage of U.S made parts on Ford products has plummeted, and it's only going to get worse. Fifty million dollar payouts to the big shots who keep sending production work to Mexico does not sound like "Detroit is back on track" to me.

**Yooper** · March-08-11, 04:25 PM

Maybe if the payouts were taxed less it would make the region more open to millionaires to move in and re-establish Detroit as a manufacturing powerhouse?

Mr. Houdini · March-08-11, 04:38 PM

Originally Posted by Yooper

Looks like Detroit is back on track!

Looks like Mulally and Bill Ford Jr. are back on track.

Ford is profitable now partially because of all the workers Ford laid off. So, you've got two guys who made millions in profit, but how many Detroiters are going to be hired back by Ford with that profit money? Maybe a dozen or two. The money went into the executive's pockets. Is Detroit really back on track? Really?

**Ray1936** · March-08-11, 05:01 PM

Well, if some jock with an IQ of 90 and a degree in physical education can make 50 million giving himself a concussion 16 times a year, I guess a guy who saved a major company is entitled to the same.

**stromberg2** · March-08-11, 05:14 PM

Spot on, Ray!!

Stromberg2

**mikefmich** · March-08-11, 06:22 PM

Originally Posted by Ray1936

Well, if some jock with an IQ of 90 and a degree in physical education can make 50 million giving himself a concussion 16 times a year, I guess a guy who saved a major company is entitled to the same.

LOL....
I was a Ford guy.......when Mulally came in and mortgaged the Blue Oval I thought this guy is NUTS & figured we were fucked.

I walked 5 yrs. ago and by 3 yrs ago I was sweating. Even if Ford went under, if I could make it to age 62 when SS would grab a large chunk of my monthly stipend, I would lose a LOT less than if I was still totally under Ford payout every month.

Maybe Mulally was nuts and a crazy gambler, but now it's a moot point. I'll just consider him smart like a fox. Whatever he gets, he earned it. I think Ford will survive for another 19 months, and I will be 62 then.

I must say, I've not often felt that way about top FoMoCo executives. Ask me about Mr. Nasser for instance.

**Ray1936** · March-09-11, 09:11 PM

Nasser! Haven't heard that name in nearly a decade! He was a real yahoo, for sure. Heard he attended meetings with his underlings in lounge PJs and a robe. Didn't do that for the upper board meetings, of course.

**Johnnny5** · March-09-11, 10:12 PM

Just did some real quick math, but unless I'm missing something the 98 million dollars in stock options given to these 2 men is greater than the combined 2010 bonuses of 20,000 Ford factory workers! That's half of Ford's American hourly workforce!

**socks_mahoney** · March-09-11, 10:30 PM

Originally Posted by Yooper

Maybe if the payouts were taxed less it would make the region more open to millionaires to move in and re-establish Detroit as a manufacturing powerhouse?

I'm hoping this is a pasty induced joke.

Lowering personal income taxes would not make millionaires want to invest in Detroit's manufacturing industry. It definitely won't make them want to live here much [[millions are millions no matter which way you cut it).

Maybe if we did the opposite, and taxed them more, we could upgrade our communication networks, fix our transportation infrastructure and educate our youth to innovate .We would still have a couple millionaires, but we would also have a middle class living and prospering here.

**Kevgoblue** · March-09-11, 10:52 PM

Originally Posted by Mr. Houdini

Looks like Mulally and Bill Ford Jr. are back on track.

Ford is profitable now partially because of all the workers Ford laid off. So, you've got two guys who made millions in profit, but how many Detroiters are going to be hired back by Ford with that profit money? Maybe a dozen or two. The money went into the executive's pockets. Is Detroit really back on track? Really?

And in addition to all the people let go, volentarily and involentarily, lets not forget about the big can they kicked down the road. Ford paid 57% of their projected liabilities into the VEBA, to let the UAW worry about that health care headache later. http://assets.aarp.org/rgcenter/econ/i4_veba.pdf And that number is most likely quite conservative when taking health care cost increases into consideration.
I predict there is going to be a lot of hoppin' mad retirees in10 years when their out of pocket costs go thru the roof and claims start being denied.

**JTistle1** · March-09-11, 11:26 PM

[QUOTE=

Maybe if we did the opposite, and taxed them more, we could upgrade our communication networks, fix our transportation infrastructure and educate our youth to innovate .We would still have a couple millionaires, but we would also have a middle class living and prospering here.[/QUOTE]

So we should tax people more because they or their families had foresight, ambition and the courage to take the risks to put together companies that hire thousands of people? Yeah.....that makes sense. I have no problem with people making money and keeping their hard earned money. It is not their responsibility to pay more than their fair share of the taxes. My own feeling is that there should be a flat percentage rate for taxes. Everyone pays the same percentage of tax on their income. Maybe that is a little idealistic, but fair. I remember hearing a sports commentator once responding to people complaining about a ref's call in a game, and that commentators answer was simple.....score more points. I'm sure this will be a very popular opinion here <insert sarcasm font here>

**Johnnny5** · March-09-11, 11:42 PM

Originally Posted by JTistle1

So we should tax people more because they or their families had foresight, ambition and the courage to take the risks to put together companies that hire thousands of people? Yeah.....that makes sense.

Are you joking? Maybe thousands of people in Hermosa, Mexico! These guys are sending American manufacturing jobs to Mexico and beyond where they pay their employees around $4 an hour. Thanks to NAFTA they send the cars back up here to Detroit and sell them for more than ever. You might call that foresight, ambition and courage, but I call it treason!

**Cincinnati_Kid** · March-10-11, 12:54 AM

Originally Posted by Ray1936

Well, if some jock with an IQ of 90 and a degree in physical education can make 50 million giving himself a concussion 16 times a year, I guess a guy who saved a major company is entitled to the same.

And who would that be? I don't give a Flyin F- -k if he saved Ford or not, that compensation they are getting is ridiculous. No one person deserves that much money. That's why this country is in the shape it's in now, GREED.

lilpup · March-10-11, 01:29 AM

The auto execs undoubtedly have the most difficult jobs in business, yet they are begrudged more than any lame, piece of shit bankers, simpleton retailers, actors, jocks, you name it. That's absolute bullshit.

No wonder manufacturing barely exists in the US anymore. The general attitude toward it STILL hasn't changed since these guys were humiliated and dragged through the mud on Capitol Hill. Shit, Mulally deserves his payout just for enduring that circus.

**Cincinnati_Kid** · March-10-11, 02:48 AM

Originally Posted by lilpup

The auto execs undoubtedly have the most difficult jobs in business, yet they are begrudged more than any lame, piece of shit bankers, simpleton retailers, actors, jocks, you name it. That's absolute bullshit.

No wonder manufacturing barely exists in the US anymore. The general attitude toward it STILL hasn't changed since these guys were humiliated and dragged through the mud on Capitol Hill. Shit, Mulally deserves his payout just for enduring that circus.

He deserves to be compensated, but not 50 freakin million dollars. What did he do, find a cure for cancer? GM and Chrysler also deserved to be dragged through the mud as you say, running their companies into the ground while still collecting bonuses and flying their lear jets all over the world. Same goes for the AIG, Lehman Bros, Goldman & Sachs execs who got bailed out and didn't serve 1 day of jail time for putting this country in economic turmoil. They got to keep their millions, while thousands of people were losing their jobs and homes. Watch this documentary called "Inside Job" it will tell you all you need to know about GREED in this country, and how the collapse got started.

**Cincinnati_Kid** · March-10-11, 02:57 AM

Originally Posted by Johnnny5

Just did some real quick math, but unless I'm missing something the 98 million dollars in stock options given to these 2 men is greater than the combined 2010 bonuses of 20,000 Ford factory workers! That's half of Ford's American hourly workforce!

Right, so who's getting screwed. They better hope gas doesn't hit $5 dollars a gallon this year.

lilpup · March-10-11, 08:26 AM

Mulally's payout is a reflection of the turnaround achieved in his tenure. His package was written years ago and is stock and stock option heavy. These aren't some arbitrary numbers pulled out of thin air after a good year like the banker wage and bonuses are. If FoMoCo didn't improve Mulally's stock is worth zip, zero, nada. And auto company improvements can't be faked on paper the way financial company gains are.

You're just pissed because Ford employees are getting better profit-sharing than your GM ass is.

**Baselinepunk** · March-10-11, 10:04 AM

This is great news. Now these guys will finally be on par with those fat and happy public employees with their fat pay and pensions. /sarcasm All joking aside, I really do think this is good news. It seems all workers in the Big Trey are sharing in a little success. Not only does this mean that folks will get some help but it also means there may be a few more duckets around for philanthropy to pick up where it left off.

**Baselinepunk** · March-10-11, 10:08 AM

"They better hope gas doesn't hit $5 dollars a gallon this year. " I actually think gas hitting 5 bucks will work for them. This time around The Trey are better prepared with better fuel efficient vehicles and workforce.

**JTistle1** · March-10-11, 09:51 PM

Originally Posted by Johnnny5

Are you joking? Maybe thousands of people in Hermosa, Mexico! These guys are sending American manufacturing jobs to Mexico and beyond where they pay their employees around $4 an hour. Thanks to NAFTA they send the cars back up here to Detroit and sell them for more than ever. You might call that foresight, ambition and courage, but I call it treason!

There comes a point in making a decision to purchase a product that you weigh cost over quality. Am I saying that our workers should be paid $4 an hour? By no means. There have to be other costs involved with sending manufacturing jobs out of the country. The main one I can think of is the inherent cost of shipping the products back to the states. But the American manufacturing industry has to find that break even point of cost vs. quality. Each one of us does it in our own lives with our family budgets. I suspect that not many of the products in any of our houses are 100% American made. I think capping the amount of money a person can make is un-American. If you don't like the wage you make, either work harder, or find a way to provide a service that increases your income, or even find a different job. Make yourself an asset to a company rather than an expense. That is the American dream. Do I want to work for someone else, or do I want to find a way to make it to the top?
As far as saying that we need to tax these people more than their fair share, do any of us know what these people do with their own money? Perhaps they are involved with charities, maybe they help families out behind the scenes. Maybe they fund many beneficial causes. I fail to see how one can say a person makes too much money.

**Johnnny5** · March-10-11, 11:02 PM

This is a couple years old, but relevant to the issue.

"CEO pay in 2009 more than doubled the CEO pay average for the decade of the 1990s, more than quadrupled the CEO pay average for the 1980s, and ran approximately eight times the CEO average for all the decades of the mid-20th century.
American workers, by contrast, are taking home less in real weekly wages than they took home in the 1970s. Back in those years, precious few top executives made over 30 times what their workers made. In 2009, we calculate in the 17th annual Executive Excess, CEOs of major U.S. corporations averaged 263 times the average compensation of American workers. CEOs are clearly not hurting."

http://www.ips-dc.org/reports/executive_excess_2010

**JTistle1** · March-10-11, 11:30 PM

Originally Posted by Johnnny5

This is a couple years old, but relevant to the issue.

"CEO pay in 2009 more than doubled the CEO pay average for the decade of the 1990s, more than quadrupled the CEO pay average for the 1980s, and ran approximately eight times the CEO average for all the decades of the mid-20th century.
American workers, by contrast, are taking home less in real weekly wages than they took home in the 1970s. Back in those years, precious few top executives made over 30 times what their workers made. In 2009, we calculate in the 17th annual Executive Excess, CEOs of major U.S. corporations averaged 263 times the average compensation of American workers. CEOs are clearly not hurting."

http://www.ips-dc.org/reports/executive_excess_2010

Just goes to show......it's a great job, if you can get it! LOL

**Cincinnati_Kid** · March-11-11, 02:49 AM

Executive Compensation is out of control, and something needs to be done about it.

**Det_ard** · March-11-11, 10:28 AM

Originally Posted by Cincinnati_Kid

Executive Compensation is out of control, and something needs to be done about it.

Why? You're not paying it. It comes out of profits, which belong to the owners [[stockholders) of the company. If they wish to pay big bucks for a CEO they think is worth big bucks, that's their choice to do so with their money. If you think they've overpayed for executive compensation, or advertising, or office supplies, or any other expense item, that's interesting but not relevant unless you're a stockholder.

In Ford's case, they [[the owners of Ford) gave up some of their ownership to give to Mulally as an incentive/reward for making a lot of money for the owners. Ford earned $6.6 billion last year. The owners gave Mulally less than 1% of last year's profit as a reward. Since they gave it as stock, it diluted the existing owners' ownership. Isn't it their right to do as they wish in that regard?

I'd be happy to give a great CEO like Mulally a 1% cut of profits if he can make billions for the owners of Ford.