Ford pays CEO $22 million, cites turnaround gains

DETROIT (Reuters) - Ford Motor Co (F.N) reported on Friday that Chief Executive Alan Mulally earned more than $22 million in 2007, citing progress in revamping strategy and structure at the struggling No. 2 U.S. automaker.

Ford, which lost $2.7 billion in 2007, noted Mulally steered through a new four-year contract with the United Auto Workers (UAW) that will allow it to hire new workers at lower wages.

In a statement issued with its annual report, Ford listed Mulally's 2007 compensation as $21.7 million based on the current accounting standard that includes stock and option grants that vested during the year.

Under a calculation that excludes the value of stock-based compensation that was granted rather than the amount that vested, Mulally's pay for 2007 was $22.75 million.

That compared to $39 million in total compensation that Mulally was paid in 2006, when he was hired away from Boeing Co (BA.N) and received a signing bonus.

Ford paid Chief Financial Officer Don LeClair $11.7 million, including a bonus award of $3 million and the recognition of a higher value for his pension. Including stock-based compensation that was granted rather than the amount that vested, LeClair was paid $12.7 million.

Ford paid Mark Fields, the head of its operations in the Americas and a candidate to succeed Mulally, $14.2 million including the value of stock-based awards granted in 2007.

Mulally's compensation included a $2 million salary and an incentive bonus of $7 million.

In its proxy filed with securities regulators, the compensation committee of Ford's board detailed its justification for Mulally's compensation.

The board cited Ford's progress in narrowing its annual loss by $10 billion in 2007 and positive cash flow for its core auto operations, results that it said were better than expected.

Mulally was also credited by the board with building "an effective executive team" and "improved operational effectiveness." He hired away former Toyota Motor Co (7203.T)(TM.N) executive Jim Farley to head up Ford's global marketing efforts.

Analysts said Mulally shook up the corporate culture at Ford and unified it globally after the automaker drifted for years, with operations sharply divided by geography and marked by bureaucratic in-fighting.

Along with other major automakers, Ford has been hit hard by the downturn in the U.S. market since last year and is targeting a return to profitability in 2009.

UAW President Ron Gettelfinger has raised executive pay as a recent concern, saying senior managers at U.S. automakers needed to share in the sacrifices made by unionized workers.

Last month, Ford said it would pay bonuses to all employees in North America, including hourly workers who received $1,000 payouts.

Ford Executive Chairman Bill Ford Jr., who stepped down as CEO after he hired Mulally in 2006, could also be paid for his work in 2008 after foregoing compensation since 2005, the automaker has said.

The board has said Bill Ford will not receive any compensation, including any payouts for 2008, until the company hits its turnaround target of returning auto operations to full-year profitability.

(Reporting by Kevin Krolicki and David Bailey; editing by Jeffrey Benkoe)