<p>Jim Padilla, president and chief operating officer, earned $966,667 in
salary and $2,034,910 in bonus, which consisted of $1.18 million in cash and a
grant of 69,000 shares of unrestricted common stock worth $854,910, as well as
$314,131 in other compensation.</p>
<p>William Clay Ford, Jr., chairman and CEO, received no cash salary in
2004. In lieu of a cash salary equivalent to $1.5 million, he was awarded
103,882 shares of restricted common stock, tying his compensation to the long-
term performance of the Company. He was awarded a 2004 bonus in the form of
841,008 shares of restricted common stock and restricted stock equivalents
with a fair market value of approximately $10.5 million at the time of grant.
In lieu of other long-term compensation, he also received a stock option grant
covering 1,587,301 shares. These options have a strike price of $16.49 and
vest over a three year period. Mr. Ford also exercised stock options covering
1,410,404 shares, realizing a value of $5.3 million, at the same time
retaining the acquired shares. In addition, he received other compensation
totaling $266,000.</p>
<p>Nice job, boys…</p>
<p>You earned these bonus for doing such a swell job…</p>
<p>And the stockl went up so the Execs bonus’ went up!!! Wowzer…</p>
<p>Please explain how a person earns such a bonus when the company is in such trouble</p>
<p>And please don’t tell me they work hard, or harder than their employees</p>
<p>The company is in some trouble because the average employee makes too much money and could easily be replaced at a more competitive lower wage were it not for an onerous union contract. They also probably have some outmoded plants. They need to get their cost structure down about $2500/car. If they don’t you won’t see Mr Padilla around too long. Even Mr Ford might be in trouble.</p>
<p>If he goes, he goes with mucho dollars, so why does he get that much money if he does such a bad job? Comlain about the union, jeesh</p>
<p>You have execs making tens of million in one year and saying a worker doing hard work makes too much money</p>
<p>HAHAHHAHA, okay that was rude, but I find that laughable, that you don’t think the execs who aren’t actually doing anything but a bad job getting paid tens of thousands of times more than someone actually building something</p>
<p>blame the union, once again, not the management who is doing a lousy job at their jobs, still accepting bonus, and for what? </p>
<p>so, you would let the bosses make tens of millions dollars off the backs of hard working Americans</p>
<p>And people call themselves patriots and supporters of this country, support this country by sucking it up and not accepting those outrageous bonues you have not earned and keep America working, and gee, the CEO’s, too bad they don’t have a union to protect them and their salaries</p>
<p>The fact is you can plug anyone with a HS dilpoma and half a brain into virtually all the manufacturing slots at a car plant. It used to work ok because there was less competition and heathcare costs were nowhere near what they are today. So the game has changed and both labor and mgt need to adapt. US car companies have done a lousy job at this and I blame both the unions and mgt. Both our new cars carry Japanese nameplates but were assembled in the US. We barely looked at any US car company products.</p>
<p>CGM, I may sound cynical but this is how it is. Senior managment’s main job is to enrich senior management. Clearly these guys are doing the best job that they can. They are not doing nearly as good a job as senior managment at other large corporations where total compensation can exceed $100mm, but times are tough.</p>
<p>Did anyone listen to NPR’s coverage of the Ford story this afternoon? According to their Detroit bureau chief, laid-off Ford union employees will be paid about 90 percent of current salaries, and continue to receive benefits, through the end of the current contract period (mid-2007). It stinks to lose your job, but, as the correspondent said, it’s something of a soft landing for union employees (many of whom will still have pensions and health benefits through Ford at retirement age). Salaried employees aren’t as lucky - once the plants close, they can find a job in another Ford location or be cut loose.</p>
<p>I’m no fan of ridiculous executive compensation, and my grandpa was a union man in the automotive industry from the 1930s on. But that’s one heckuva generous agreement for folks who aren’t on the job. I’ll grant barrons that both union and management share the blame for Ford’s current predicament. However, I can’t agree with him that “The fact is you can plug anyone with a HS dilpoma and half a brain into virtually all the manufacturing slots at a car plant.” I find this comment insulting, unnecessary, and un-proveable.</p>
<p>It’s one of the reasons that the American automobile industry is tanking. Basically the auto companies bought labor peace with way too generous concessions and pushed the problem down the road for someone else to solve. Unfortunately it can’t be pushed down the road any longer.</p>
<p>Ford, GM, and Chrysler also have to deal with another very serious problem in southeastern Michigan - the best and the brightest young people are moving away and not sticking around. Michigan’s Governor Granholm has conjured up a silly idea called “cool cities” to address the problem. It will be interesting to hear what the national press has to say about Detroit during the upcoming Super Bowl - my guess is that “cool city” (other than its temperature) will not be appearing in too many headlines.</p>
<p>I think Henry Ford would disagree with you. Jobs are designed to be relatively simple and easily learned within a short period of time. While they some do require physical strength and stamina, the knowledge required is small. I have worked several assembly line jobs and the most smarts required was to count to 24 about 500 times a day. </p>
<p>Jobs in the machine (engine, trans, etc.) shops and design are different and require high levels of skill. Painting used to require some skill but now robots do it as well as most of the welding and heavy lifting.</p>
<p>I don’t know a lot about car manufacturing, but for example H works at Boeing. He is a machinist and has built the prototype of the 787, has worked on special projects for the military, designs tools to make one of a kind parts, works with toxic materials and powertools on a routine basis, has to tell engineers how to do their job because they often arent familiar with properties of composites being used, I could go on, but I will sum up by saying he has 30 years of experience and is paid less per hour than a new teacher.
IF he is over paid, exactly how much do you think people who work in manufacturing should be paid an hour?</p>
<p>UAW workers will receive 90% of their pay and full benefits once the shutdowns occur over 7 years which is the end of the contract. They will also get college education opportunities and pensions are still intact. It is too bad but these folks aren’t penniless…</p>
<p>Boeing is not a volume manufacturer like an auto plant. Most parts require machinist skills to make as they are not mass produced. Few jobs at Boeing are similar to auto assembly. I have been through every Boeing facility in Seattle and there is little that looks like an assemblyline in Detroit.</p>
<p>I really know very little about factory work except maybe the Triangle fire
I can’t stand repetion, even when I had a desk office job I went nearly insane from the tedious bits.
At Boeing of course they have such high security, I have only been in the plant once, and that wasn’t anywhere near H worked.</p>
<p>but re pay scale - when you are a union worker you can’t get raises
it is all about the contract
his area has limited job levels.
After 9/11 he was laid off, they wanted to keep him so they gave him a different job title, that was a lower pay scale, but his years of seniority enabled him to hang on.
he would be very difficult to replace, they have tried to get him to go to college so that he could move into management, but he wants to stay with what he is doing.
He is a big advocate of unions but he admits that there is a lot of waste because of nepotism and folks who arent fired because no one wants to go through the hassle of all the documentation that the union would require to get rid of someone.
But then on the other hand- Boeing wastes a lot of money when they subcontract out work to companies who don’t know how to do it- to save money, then it gets sent back to the Boeing plant and the workers there have to do it all over again, meanwhile the airline or govt is waiting for their plane.
The union is supposed to help stop subcontracting, and they have some, but they can’t stop all of it.</p>
<p>The primary problem with Ford is not the labor wages, but the fact that they design a poor product. This is not the fault of the factory workers, but poor performance by engineers and other white collar workers. Interestingly, Toyota built a plant in Canada because of the high level of educational attainment. Clearly, education plays some (although limited) role in auto manufacturing.</p>
<p>Of course you’re right that poor product design is the primary problem facing Ford and the other American auto manufacturers. If they’re building cars that people don’t want, then you’re going to have a tough time staying in business. It’s also true that product design is not the fault of the factory workers.</p>
<p>What is true is that the UAW has contributed to the downward spiral by the demands it placed on industry. Check out issues like the “jobs bank”. Thousands of auto workers from GM, Delphi, Ford, Chrysler, Visteon who are getting paid who show up everyday to do crossword puzzles - billions of dollars - yes, billions - that are paid to people who show up everyday to do…nothing.</p>
<p>That’s not product design…but it is incredibly poor management who caved to the UAW and put the industry in that position.</p>
<p>The difference between American and foreign auto manufacturers (with US based plants) is not so much hourly wages and healthcare costs between union and non-union workers. It is all about the cost of retirees. Foreign owned US plants simply dont have the weight of many retirees to support.</p>
<p>To blame workers simply misses the point. Workers do not greenlight product. Management does. Lackluster product design and execution will not bring up your market share. If you review product recalls in the auto industry, the problems are not assembly related, rather it is component failures. From my conversations with relatives and friends that work with the Big Three, the relentless component cost battle goes something like this: component manufacturers and the auto companies agree on a price for so many parts of a certain type. Then the auto companies demand a 20% cut in the component price to get the contract or else demand the Chinese manufacturing price. Suppliers get hammered. The only way to meet cost constraints is to cheapen the part frequently by using less durable materials or by changing the metallurgical characteristics of required metals. Out of sight from the consumer, electrical components use lighter gauge wires and contacts. Product quality may pass muster for the first year (hopefully), and then the recalls begin. Think about the introduction of the Ford Focus and the Escape SUV in their first year. These vehicles were plagued with scores of recalls and TSBs (Technical Service Bulletins). </p>
<p>Its not the assembly line worker who failed. Its a management team that squeezed cost (and quality) out of suppliers Toyota (US) uses many of the same suppliers that the Big Three use, yet all US suppliers rate the Japanese first in terms of trustworthiness and the Big Three rank at the bottom. </p>
<p>Re job banking</p>
<p>Its certainly true that job banking costs big money. At collective bargaining time, it was Ford that blinked. Blame management for caving in and, if youre a shareholder, demand a new management team. If you get paid to sit and read the paper all day, whose fault is that? The guy warming the bench or the suits at the Glass House who agreed to it in the first place? Remember, those workers were productive until bad management and poor product design and sales put them in “study hall”.</p>
<p>Agreed. Management at Ford et al must take the blame for “blinking” as they must take the blame for a product that the American consumer thinks isn’t worth purchasing. Meanwhile Ford and GM can’t hire the cream of the crop because the best don’t want to work for what is perceived by many to be a dying industry and have to live in southeastern Michigan.</p>
<p>I know it’s an anecdote, but…I know someone who recruits for what would be considered one of the top two or three law firms in Detroit. He has told me that they recruit at the best law schools in the country beyond the University of Michigan. No one…and he was very emphatic on this point…will come to work for them unless they have some sort of a connection with the state of Michigan i.e. relative who lives here, etc.</p>
<p>This is what the state of Michigan is contending with right now. It is not pretty.</p>
<p>The most amusing part of that is the whole issue that UMich law school made with SCOTUS regarding their admission policy. Let us hope they enjoy the decision and their lofty status as a law school. Motor City is no longer and what Michigan has to sell are the beautiful natural areas for tourism…to those who work in other states.</p>
<p>Toyota built its second plant in Canada because it could shift its own health costs to the national health system. In so many words, all Canadians pay/subsidize for the cost of the employees of Toyota. Not that it changes that much, but the difference between building the plant in Alabama or Ontario is huge for Toyota. </p>
<p>As far as wages, whenever you have a plant where the janitor earns double than what the highest factory worker would earn in Mexico, or five to ten times in Slovakia or Poland, you KNOW that your days are numbered. However, it does not stop there. Shokingly, local employers in the automotive and electronics industry have reported HIGHER productivity in Mexico. When you can hire an industrial engineer who is prepared to work 12 hours shifts listening to the UAW concerns about fatcats must get tiring. </p>
<p>However, the burden of the wages is only part of the puzzle. The biggest reason for the attrition of business along the supply chain has been the inability to adapt to new methods of delivery (JIT being one) and flexibility in terms. Everything is now based on efficiency and results; the time of cozy and long-term relationships -read corrupt- is vanishing.</p>
<p>With modern communications there is no reason Ford can’t have its design/engineering functions in North Carolina, California or some other state deemed more attractive.</p>