Discuss Detroit Archives - Beginning January 2006 GM following Kerkorian suggestions Previous Next
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Rustic
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Username: Rustic

Post Number: 2030
Registered: 10-2003
Posted From: 130.132.177.245
Posted on Tuesday, February 07, 2006 - 2:22 pm: Edit PostDelete PostMove Post (Moderator/Admin Only)

GM slashes dividend, CEO pay, retiree benefits
Moves follow proposals by Kerkorian aide as world's biggest automaker seeks to reverse huge losses.
NEW YORK (CNNMoney.com) - General Motors Corp. slashed its dividend and cut the pay of CEO Rick Wagoner and other top officers Tuesday, and announced moves to cut retirement and health costs for nonunion workers.

The steps are similar to ones outlined in a recent speech by Jerry York, an adviser to GM's largest individual shareholder, Kirk Kerkorian.

York, who was named to the GM board Monday evening, last month called for the company to get in "crisis mode," and he argued that a sense of shared sacrifice was needed to win additional contract concessions from the United Auto Workers union, which represents more than 100,000 workers at the troubled automaker.

...

The move on the dividend should save the company about $550 million a year. The company reported a net loss of $8.6 billion last year, the biggest since 1992, and saw its bonds cut to junk status by the major rating agencies. The cut should also cost Kerkorian, who owns a 9.9 percent stake in GM through his Tracinda Corp., about $56 million a year.

In terms of pay cuts, Chairman and CEO Rick Wagoner will have his pay slashed 50 percent, while other top officers will have their pay cut 10 to 30 percent. Outside directors of the company will also have their compensation cut 50 percent.

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The company also announced it intends to essentially end its pension plan for salaried retirees, but did not say when. GM plans to freeze accrued benefits in the current pension plan for salaried employees and retirees. Final details were not set but the company said it may move toward a defined contribution or cash balance plan. That move will affect future salaried retirees only.

...

Wagoner also defended the decision not to follow two of York's other recommendations -- graduated pay cuts across the company's salaried staff and a cut back in the number of car brands that GM markets and sells.


recalling that Delphi compensation thread from a few months ago ...
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Gravitymachine
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Username: Gravitymachine

Post Number: 840
Registered: 05-2005
Posted From: 198.208.159.18
Posted on Tuesday, February 07, 2006 - 3:29 pm: Edit PostDelete PostMove Post (Moderator/Admin Only)

<---waiting for the other shoe to drop. that other shoe being a rumored 3% salaried employee paycut.
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Motorcitymayor2026
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Username: Motorcitymayor2026

Post Number: 477
Registered: 10-2005
Posted From: 71.10.63.140
Posted on Tuesday, February 07, 2006 - 3:32 pm: Edit PostDelete PostMove Post (Moderator/Admin Only)

a 3% salary cut sounds like a good idea. It wouldnt make TOO big of an effect on the individual, but overall would save lots of money for GM.

Wagoner and his top executives are taking a 50% pay cut
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Mikem
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Username: Mikem

Post Number: 2383
Registered: 10-2003
Posted From: 68.43.15.105
Posted on Tuesday, February 07, 2006 - 3:34 pm: Edit PostDelete PostMove Post (Moderator/Admin Only)

3%...that's it? Must be tough...try taking a frickin 39% cut after decades with no raises.
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Gravitymachine
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Username: Gravitymachine

Post Number: 841
Registered: 05-2005
Posted From: 198.208.159.18
Posted on Tuesday, February 07, 2006 - 3:41 pm: Edit PostDelete PostMove Post (Moderator/Admin Only)

its all relative mikem.

I could take 3% in stride. obviously though, I can't speak for the rest.

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