Ford is on its way back up to the top of the mountain. The Detroit Free Press reports that Ford will offer pay raises and bonuses this spring. It will be the first time the iconic U.S. automaker has given raises since 2008, a reflection of Ford’s renewed financial strength.
More than 20,000 workers to receive raises
Letter sent to approximately 20,000 salaried Ford workers worldwide delivered the news of pay increases, company spokeswoman Marcey Evans told the Free Press. A reported 2.7 percent base salary increase will be applied to letter-holders April 1.
Ford will not discuss the amount of the salaried bonuses granted, but noted that the size of the bonus payments will be based upon individual performance and other financial metrics that are still in the calculation process. Last year, Ford’s average performance bonus for salaried workers was equal to 15.5 percent of annual salary, said economist Sean McAlinden of the Center for Automotive Research. Insiders predict that Ford will release fourth-quarter and full-year financials for 2011 later this month.
Executives get bonuses bigger than salaries
Various sources indicate that Ford’s senior executives, such as CEO Alan Mulally, Executive Chairman Bill Ford and president of the Americas Mark Fields will receive bonuses in excess of their annual salaries. In 2010, Mulally was granted a $9.45 million cash bonus, well above his $1.4 million salary. Ford’s bonus was $2.7 million with a salary of $1.4 million, and Fields received a $3.6 million bonus to supplement his $1.34 million salary.
Ford’s pretax operating profit for 2011 will reportedly exceed 2010’s total of $8.3 billion.
Saluting the workers
Each of Ford’s United Auto Workers employees were given a profit-sharing check for about $5,000 last March, based upon 2010 results. In addition, as part of a new four-year agreement with Ford, the auto workers were giving additional profit-sharing checks in December 2011 that averaged $3,252. Bonuses were calculated based upon Ford’s profits in North America. Signing bonuses, competitive bonuses and inflation protection bonuses were also applied.