Zetsche gets pay raise after record Mercedes deliveries

Dieter Zetsche is pushing Mercedes to become the No. 1 global luxury automaker. Photo credit: Reuters

FRANKFURT (Bloomberg) -- Daimler increased CEO Dieter Zetsche's pay 1.2 percent after the third-biggest maker of luxury cars reduced its sales gap with larger competitors last year on record deliveries.

Zetsche's compensation for 2013 rose to 8.25 million euros ($11.3 million) from 8.15 million euros a year earlier, the Stuttgart-based manufacturer of Mercedes-Benz cars said today in its annual report.

Combined pay for Daimler's management board rose 11 percent as the manufacturer added Hubertus Troska, head of Chinese operations, as a member.

Deliveries at Mercedes-Benz, which ranks behind BMW and Volkswagen Group's Audi unit in global premium car sales, advanced faster in the final months of 2013 than at Audi. Mercedes also posted a higher full-year sales growth rate than BMW for the first time since 2010.

Zetsche's compensation includes a base salary of 2.01 million euros, unchanged from last year, a short-term bonus of 1.71 million euros, a medium-term bonus of that amount, depending on share performance and payable in 2015, and long-term variable compensation including stock options. The short-term bonus for the eight-member board was raised to 6.07 million euros from 4.65 million euros a year earlier.

Growth forecast

Earnings before interest and taxes, part of the basis for executives' bonuses, jumped 23 percent last year to 10.8 billion euros, helped by the sale of Daimler's remaining 7.4 percent stake in EADS, the planemaker now called Airbus Group.

Daimler, also the world's biggest truckmaker, is forecasting that vehicle sales in 2014 will exceed last year's deliveries, while revenue and earnings will increase "significantly."

After Andreas Renschler's departure last month as head of production for Mercedes-Benz, the group management board was reduced to seven members. Renschler's successor, Markus Schaefer, has a seat on the divisional board of Daimler's Mercedes-Benz passenger-car brand.

Chief Financial Officer Bodo Uebber, whose contract was extended this week by five years until the end of 2019, earned 3.54 million euros in 2013, unchanged from the year earlier.

Wolfgang Bernhard, who took over as trucks chief in a job swap with Renschler last April, got 3.03 million euros, a decrease of 0.7 percent.

Troska also received 3.03 million euros in his first full year of running Daimler's Chinese business.

Management board pay totaled 30.2 million euros. Excluding Troska's compensation, remuneration increased 0.1 percent.

Profitability at the Mercedes-Benz Cars division, which includes the Smart brand, lags behind figures at BMW and Audi.

Mercedes's return on sales narrowed to 6.2 percent in 2013 from 7.1 percent in 2012. That compares with nine-month operating margins of 10.1 percent of revenue at Audi's carmaking unit and 9.5 percent at BMW's automotive division. The two competitors have yet to report full-year earnings.

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