Imagine you?re an up-and-coming automotive executive looking to score your first million dollar pay cheque. You might like to reassess that goal, if Chrysler is on your list of potential employers.
As part of its financial aid package ? which for Chrysler, equals just over US$8 billion ? the US government has laid on more than a few conditions which ought to please Joe Taxpayer, but won?t result in too many smiles in the automaker?s executive wing.
When CEO Bob Nardelli exits the company at the end of its bankruptcy, his replacement will find his or her salary capped at US$500,000 ? down from the usual multi-million dollar packages (and ?executive bonuses?) corporate dons everywhere have been paying themselves.
In Nardelli's case, the new pay rate will be a raise when compared to the US$1 dollar annual salary he assigned himself last year as CEO of Chrysler. (Of course, the US$210 million final payment Nardelli received for his former post as CEO of Home Depot would have lightened that burden somewhat.)
The new Chrysler CEO won?t be alone in the US$500,000 club though, with the top 25 executives at the company seeing similar ceilings placed on their income.
The limits don?t exclude Chrysler?s executives from receiving shares in the company, although access to those shares will not become available until the government loans have been repaid.
With most of the company?s shares tied up between Fiat, the UAW retiree health-care trust fund and the US and Canadian governments, there isn?t likely to be much left over.
Chrysler?s new CEO may find that $500,000 pay cheque getting stretched a little sooner than expected, with further government conditions forbidding the company from owning or leasing private jets ? meaning that any flights to Italy for meetings with the company?s new partner, Fiat, will be on the CEO?s own tab.
Interestingly, the conditions do not bar the new CEO from receiving a second income from another job, meaning that if Fiat CEO Sergio Marchionne becomes Chrysler?s CEO as well, he?ll likley maintain both remunerations.
[via Detroit Free Press]