GM Increased Wagoner's 2007 Pay 41% to $14.4 Million
General Motors Corp. raised Chief Executive Officer Rick Wagoner's total compensation by 41 percent to $14.4 million in 2007, a year when the largest U.S. automaker posted a record loss and its domestic sales declined, Bloomberg reported.
Pay for Wagoner, 55, included $1.56 million in salary, GM said today in a U.S. regulatory filing. The increase was mainly because of incentive-plan payments and a boost in the value of his pension. Wagoner's total compensation was less than the $21.7 million Ford Motor Co. has reported for CEO Alan Mulally.
``Running GM is one of the tougher CEO positions right now,'' said Mirko Mikelic, senior portfolio manager at Fifth Third Asset Management in Grand Rapids, Michigan, which holds debt issued by the automaker among $22 billion under management. ``There are a lot of easier CEO jobs that pay more than GM.''
GM boosted Wagoner's compensation as he reduced annual costs by $9 billion in the past two years, persuaded more than 34,000 union workers to leave and negotiated a contract that trims pay for future workers in half. The Detroit-based automaker's U.S. sales of cars and light trucks fell 6 percent last year, more than double the industry's 2.5 percent decline.
The loss of $38.7 billion last year was mainly because of a $39 billion charge for tax accounting. GM posted losses of $1.98 billion in 2006 and $10.4 billion in 2005.
GM's shares fell 19 percent last year in New York Stock Exchange composite trading. They declined 73 cents to $21.38 at 4:15 p.m. today and have dropped 14 percent this year.
The automaker in its filing today also proposed appointing E. Neville Isdell, 64, who is retiring as Coca-Cola Co. CEO in July, as a director, expanding its board to 14 members.
Isdell came out of retirement in 2004 to revive the Atlanta-based soda maker's sales after consumers concerned about obesity cut back on sugar-laden drinks. He will remain chairman until Coca-Cola's annual shareholders meeting in April 2009.
Wagoner in addition to his salary received stock and stock- option awards that GM valued at $6.34 million, $1.8 million from the incentive plan, $4 million in increased pension value and deferred compensation, and other pay of $697,358. The pension value reflects a change to allow full retirement benefits at age 60 rather than 62, GM spokeswoman Julie Gibson said.
His total compensation for 2006 was $10.2 million, GM said.
The automaker in March restored Wagoner's annual salary to $2.2 million, ending a voluntary pay cut from two years earlier, and set his 2008 incentive target at $3.52 million.
The United Auto Workers union, which last year agreed to allow lower wages for GM's future workers, didn't immediately respond to a call seeking a comment about Wagoner's 2007 pay. When Ford disclosed compensation for Mulally and other executives on April 4, the UAW called it ``excessive and unjustified.''
Vice Chairman Bob Lutz, 76, head of product development, got $6.89 million in compensation, including $1.28 million in salary, GM said in the filing today. That was down from $8.44 million for the previous year.
Chief Operating Officer Fritz Henderson, 49, received $7.61 million in compensation, including $1.28 million in salary, in his role as chief financial officer last year. His total was an increase from $5.19 million for 2006.
Henderson moved to his current job in March. GM last month reported a $1.8 million 2008 salary and an incentive target of $2.43 million for Henderson as operations chief.
GM said it will hold its annual shareholders meeting June 3 in Wilmington, Delaware.
The company's proxy filing listed 10 shareholder proposals. They include requests that the automaker give detailed disclosure on political contributions, support universal health-care reform and agree to specific greenhouse-gas reduction plans.
Shareholders are also seeking to win the right to call special meetings, gain more power in replacing directors, cast an advisory ballot on executive compensation and base pay more closely to performance, according to the filing.
GM last year edged Toyota Motor Corp. as the world's largest automaker by about 3,100 vehicles on the strength of growth in emerging markets. In this year's first quarter, Toyota again moved ahead of GM, by about 160,000 units. GM's North American results dragged down gains in Asia and Latin America.