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New Ford CEO Gets Massive Compensation

Ford Motor Co.`s new chief executive, Alan Mulally, is set to receive a one-time bonus of $18.5 million, the amount consists of a specific bonus of $7.5 million as well as $11 million to compensate for the salary he gave up for leaving his former position as an executive at Boeing, where he is widely credited with having successfully revamped Boeing`s commercial airplane division.

After the bonus, Mulally will be paid a base salary of $2 million per annum. Last week, Ford Chairman and CEO Bill Ford announced he was stepping down in favor of Mulally, citing the need to remedy the company`s increasing losses and Ford`s decreasing U.S. market share. In addition to his salary and bonus, Alan Mulally will be given 600,000 in restricted stock units over the course of three years.

If one computes the worth of Ford stocks currently worth $8.77 per share, the stock grant gives Mulally an additional $5.26 million. Ford Motors has also given Mulally the option of 3 million shares in over three years at an option price of $8.28 a share. Mulally will be given the full option grant if Ford Motors stock rises to at least $30 a share and stays there for 30 trading days, according to the Ford`s SEC filing.