DETROIT — Jim Hackett received $17.75 million in total compensation during his first full calendar year as CEO of Ford Motor Co., a year he admittedly called “mediocre.”
Compensation for two other top executives dropped by more than half last year as the company fell short of some performance targets and paid lower incentive-based bonuses.
Ford hit 100 percent of its 2017 performance targets but only 72 percent of them last year, due to missed targets in revenue, adjusted EBIT margin and operating cash flow. Ford exceeded its quality targets thanks to improvements in “things gone wrong” and customer satisfaction.
Hackett's compensation, disclosed in a regulatory filing, included a base salary of $1.8 million, stock awards of $12.7 million and $2.6 million in bonuses and incentives. It includes $104,342 for personal use of a plane, a perk Hackett and his predecessors have long enjoyed.
Hackett's total compensation of $17.75 million for 2018 is an increase from the $16.7 million he earned in 2017.
By comparison, Ford said in its filing that the median compensation for all Ford employees other than the CEO last year was $64,316.
Hackett’s raise came during a year in which Ford posted a $7 billion profit on a margin of 4.4 percent, down from 6.1 percent in 2017.
Net income fell 52 percent in 2018, though revenue rose 2.2 percent. Ford earned $7.6 billion in North America in 2018, 6 percent less than the prior year. It lost $2.2 billion in the rest of the world, with Asia Pacific accounting for half of the red ink.
“2018 was mediocre by any standard,” Hackett said in a January email to employees, telling them to “bury the year in a deep grave, grieve over what might have been and become super focused on meeting, and, in fact, exceeding this year’s plan.”
Ford CFO Bob Shanks was the only other executive among the five highest-paid employees to receive an increase in 2018. He earned $8.42 million, up from $6.7 million in 2017.
Compensation for Executive Chairman Bill Ford fell to $13.84 million from $15.6 million in 2017.
Jim Farley, Ford's president of global markets, received $5.86 million, down from $13.47 million the year before. Joe Hinrichs, Ford's president of global operations, made $5.82 million, down from $12.1 million.
The two could have each earned $1.1 million in incentive bonuses if Ford hit 100 percent of its targets. Instead, Farley and Hinrichs earned bonuses of $792,000 and $802,080, respectively.
General Motors CEO Mary Barra’s pay slid 2.8 percent to nearly $22 million in 2017; GM will report her 2018 compensation later this year.