Talk about getting religion and sending a message to Washington.
Tuesday afternoon Ford took another huge step in showing it's committed to cutting costs and "sharing the pain".
The company agreed to cut the salaries of Chairman Bill Ford and CEO Alan Mulally by 30% for the next two years, waived cash compensation of the board of directors, and is eliminating performance bonuses for global salaried employees and senior executives for 2009.
As important as the cuts are in helping Fords bottom line, the real benefit is in the message this step send to Washington. This is Ford telling law makers that it is adamant about making the changes needed to avoid having to take Federal loans.
In short, Ford is saying, "We get it!!!"
Mulally is cutting his $2 Million annual salary by $600,000. Remember 3 months ago when the Big 3 CEOs went to Capitol Hill the first time? Ford's top man Alan Mulally was asked if he would take a cut in salary, and he answered, "No, I'm good."
Given his salary in '07 totaled more than $21 Million, his answer sent the wrong message to Congress.
Knowing Alan as I do, I'm sure if he could take back his answer he would. Since then, he's made it clear he would work for as little as $1 (if Ford ever takes tax payer money) and now, he and other Ford executives are sending another clear signal that Ford Motor Company knows what it has to do.
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