Ford Motor Co. hiked the compensation of chief executive Alan Mulally by 11 percent in 2013 to $23.2 million after logging record earnings in North American and Asia. Mulally received $2 million in salary, $5.88 million in bonus and $15.3 million in stock, options and other compensation, Ford said in a regulatory filing.
In 2012, Mulally received $2 million in salary, $3.95 million in bonuses and $15 million in other compensation. Mulally, who said in January that he would remain at Ford through 2014, is credited with creating a more collaborative culture at the carmaker and with leading a turnaround that allowed it to avoid federal bailouts and bankruptcies that caught up with rivals General Motors and Chrysler.
Ford has earned a total of $42.3 billion in the past five years after losing an accumulated $30.1 billion from 2006 through 2008. “He’s worth every penny,” said Bernie McGinn, chief executive of McGinn Investment Management in Alexandria, Virginia, told Bloomberg. He added that while people forgot how difficult and revolutionary Mulally’s action was, Ford have had four years of good products and is winning.
According to the proxy filing with the US Securities and Exchange Commission, Ford’s top executives managed to achieve 112 percent of the targets set for them by the carmaker board of directs. Despite overperforming on pretax profit and cash flow goals, the executives only achieved 73 percent of cost targets, 65 percent of market share goals and 88 percent of quality targets.
The US carmaker posted $8.8 billion in record pretax profit in North America and $425 million in its Asia Pacific Africa region in 2013. Ford also doubled its quarterly dividend to 10 cents in 2013 and hike it to 12.5 cents in the first quarter of 2014. Earlier this month, Mulally received $13.8 million in stock as part of an incentive plan for 2013 performance. Since arriving at Ford in 2006, Mulally’s total payout has reached over $300 million.
Ford has been prosperous ever since Mulally outlined his One Ford global product plan. Before, Ford was a carmaker that only focuses on pickup trucks, SUVs and gas-guzzling cars. Now, Ford has become a carmaker that offers strong products on different fronts. Mulally was responsible for instituting a new system in which Ford develops vehicles for global markets, rather than for individual regions. Thanks to this new system, Ford wasn’t just able to cut cost, but was also able to revamp its product lineup with stylish yet fuel-efficient models.
In 2013, Ford sold 2,485,236 vehicles in the United States in 2013 for an 11-percent jump. It was also able to increase its US market share to 15.9 percent. Ford logged $7.2 billion in net income in 2013, up from $5.7 billion in 2012. Its full-year revenues jumped 10 percent to $146.9 billion.