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Chrysler’s Nardelli Says He’d Mimic Iacocca, Accept $1 Salary

November 19, 2008
Related Topics: Corporate Culture, Compensation Design and Communication, Latest News
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Chrysler CEO Bob Nardelli said he would accept $1 per year in salary if it helped Chrysler obtain its $7 billion share of a proposed $25 billion automaker rescue package.

Nardelli said he would make that gesture in response to a question from Sen. Jon Tester, D-Montana, who said sacrifice by Lee Iacocca in 1979 helped Chrysler Corp. win a $1.5 billion loan guarantee.

General Motors CEO Rick Wagoner didn’t specifically answer the question. He said he had previously cut his salary by 50 percent.

Ford Motor Co. CEO Alan Mulally—who earned $21 million last year at Ford, according to Bloomberg News—said he was concerned that cutting compensation might cause the company to lose executives and be unable to attract top talent.

Senate Banking Committee Chairman Christopher Dodd, D-Connecticut, said executive compensation has been a flash point with his constituents since the $700 billion federal bailout of banks and financial institutions.

Dodd said he can’t understate how sensitive that issue is to those lawmakers considering aid for automakers.

Dodd reiterated that he did not know whether enough time remained in the current lame-duck session of Congress to get a loan package ready for Detroit’s Big 3 automakers.

In January 2007, Nardelli resigned as chairman of Home Depot Inc. after six years. His $210 million severance package sparked a firestorm of controversy. He isn’t required to disclose his salary at Chrysler, which is owned by the private equity firm Cerberus Capital Management.

Filed by David Barkholz of Automotive News, a sister publication of Workforce Management. To comment, e-mail editors@workforce.com.

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