Ford CEO Jim Hackett Only Made $17.4M in 2019
With so many Americans facing financial hardship in this difficult and unprecedented time, it’s important to remember that everybody is going through it — including but most especially the millionaires. Take Ford CEO Jim Hackett, who must be having trouble making ends meet given that his total compensation plummeted 2.2 percent in 2019. According to Ford’s 2020 proxy statement, his total earnings tumbled from $17.8 million in 2018 to a meager $17.4 million last year.
Making the news all the more perilous for Hackett is the fact that he — along with other Ford execs — has pledged to defer 50 percent of his base salary until Ford can repay $7 billion of the $15.4 billion it borrowed following the suspension of North American production. How will this man eat?
Hackett’s base salary for 2019 was $1.8 million. If that holds in 2020, he would stand to lose $75,000 a month with the deferment. Were he to defer half of his base pay from May to December, he would only make a paltry $16.8 million in 2020. That’s only around $1 million more than what he made in his final three years as CEO of Steelcase combined.
But fear not! Hackett is only deferring that money temporarily; he’ll get it all back after Ford pays back into its two credit lines. It’s nice to know there are some happy endings in this cruel, cruel world.
Hackett’s 2019 compensation 157 times more than median employee
Jim Hackett’s compensation for 2019 includes $13.2 million in stock awards, $1.7 million in incentives (down an astonishing 32 percent from 2018, a year he dubbed “mediocre by any standard”), and $617,637 in other compensation. The latter includes $150,880 for essentials like foreign tax preparation fees, living expenses, and car washes. You know, your basic blue-collar stuff we’re all pretty familiar with.
Also noteworthy is the fact that Hackett’s dip in salary contributed in part to a major decrease in the ratio of his salary against all other Ford employees. Jim Hackett only made 157 times more than the median compensation (which includes all officers other than Hackett), which rose from $64,316 to $110,706 in 2019 due to increased pension contributions.
In 2017, his first partial year on the job, Hackett made 285 times the median employee salary with a cool $16.7 million for seven months’ work. If things keep going at this rate, workers might wind up one day being paid a rate commensurate to their labor, which would be crazy and unrealistic.
Ford’s 2020 proxy statement notes that the company returned $2.6 billion to shareholders in 2019.
Other Ford execs get big 2019 compensation bumps
Excitingly, it wasn’t all doom and gloom when it comes to the fair and just compensation of executive officers at Ford. After taking over for Bob Shanks as CFO in June 2019, Tim Stone earned a healthy $8.3 million in compensation, including a $1.5 million bonus presumably just for doing a super great job for six months. The former CFO Shanks saw his compensation dip $103,089 to $8.3 million in 2019 despite collecting $3.5 million in pension value and nonqualified deferred compensation earnings.
Then there’s Ford Executive Chairman Bill Ford, who — thanks to a $2.6 million bump in pension value — saw his compensation rocket from $13.8 million in 2018 to $16.8 million. He made $10.4 million in stock awards, up from $10.1 million in 2018, but his base salary remained flat at $1.7 million. Exceptionally generous, Ford will defer 100 percent of his base salary to help Ford repay the $15.4 billion it borrowed — he’ll get his money back once Ford hits the $7 billion repayment threshold, thankfully.
Right there with Bill Ford in terms of growth are new Chief Operating Officer Jim Farley and newly retired former President of Automotive Joe Hinrichs. In the case of the former, Farley saw his compensation leap from $5.9 million in 2018 to $8.4 million last year. Compensation gains came from a $25,000 boost in base salary, $185,600 in bonuses, and a $2.3 million increase in stock awards. Hinrichs, who retired abruptly earlier this year, saw his compensation more than double from 2018 with $11 million thanks to a $2.5 million increase in stock awards and a $2.6 million change in pension value.