The biggest dealership group in the United States -- AutoNation Inc. -- has reduced the pay packages for its top two executives last year. Chief Executive Officer Mike Jackson earned $6.43 million total compensation last year, a decline from the $6.77 million he earned in 2010. His salary of $1.15 million was unchanged, but his bonus declined to $1.51 million from $2.86 million.
The value of stock option awards to Jackson increased around $1 million to $3.58 million. Chief Operating Officer Michael Maroone earned a $5.03 million total compensation in 2011, a drop from the $5.2 million he earned in 2010.
His salary of $1 million was unchanged while his bonus decreased to $982,200 from $1.87 million. The value of stock option awards to Maroone increased around $800,000 to $2.86 million. The compensation levels for 2011 were revealed in the dealership group's proxy statement issued on Monday.
These compensation levels include aircraft and vehicle allowances. Even with the considerable rise in earnings last year, AutoNation trimmed executive bonuses after it fell just short of achieving one of two measures governing its executive incentive plan.
Specifically, AutoNation set a target of $3.65 for its adjusted operating income per basic share. It achieved $3.59, which is still a considerable increase. In 2010, it aimed for $2.24 and hit $2.84 for that same measure.
The dealership group topped the goals set for the other incentive plan measures of adjusted operating income as a percentage of gross margin. AutoNation disclosed that adjusted operating income in 2011 were 24.4% of gross margin, which is higher than the 23.5% goal. AutoNation spokesperson Marc Cannon disclosed that they raise the benchmark every year and continue to challenge themselves to perform better.