Ford Executives Get Pay Cuts, Board Forgoes Compensation
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Ford Motor company's top two executives will be "awarded" a 30 percent pay cut as a result of the financial downturn, nytimes.com reports. The measure will affect Allan Mulally's and William Ford Junior's leisure expenditures for both 2009 and 2010.
The information is part of a memo issued to employees on Tuesday which also states that Ford's board will forgo this year's cash compensations. The news comes a day after Ford reached an agreement with the UAW, allowing the company to pay less cash into the retirees health care fund.
Not only top management earnings are affected by the crisis inspired decisions. For the second year in a row, the company's salaried workers will not get performance bonuses. Further more, there will be no merit raises this year. “We think it’s important to show that everybody at Ford is doing what’s necessary to get through this downturn and get the company healthy again,” Mark Truby, a Ford spokesman, said.
Despite the fact 2008 brought the biggest annual loss in its history, Ford holds its ground and hopes to remain the single Detroit based manufacturer not to file for government aid. The company stands "firm in the resolve to operate without needing to access a bridge loan from the U.S. government."
Allan Mulally, Ford CEO, earned $2 million in salary and was awarded $21.7 million total compensation in 2007. He said in Washington a few months ago he will accept a one dollar annual salary if the company finds itself in need of government loans.
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