UAW's King calls Ford CEO compensation "outrageous"

DETROIT Tue Mar 22, 2011 7:49pm EDT

United Auto Workers International President Bob King addresses the media in Lansing, Michigan October 28, 2010. REUTERS/Rebecca Cook

United Auto Workers International President Bob King addresses the media in Lansing, Michigan October 28, 2010.

Credit: Reuters/Rebecca Cook

DETROIT (Reuters) - United Auto Workers union President Bob King said recent compensation awards for Ford Motor Co (F.N) Chief Executive Alan Mulally are "outrageous" at a time when some workers who make Ford vehicles earn $15 per hour.

"I think Alan Mulally has been a great CEO and I don't think any human being in the world deserves that much money," King told reporters after the first day of a three-day strategy conference for the UAW on new contracts for auto workers with Ford, General Motors Co (GM.N) and Chrysler. Current contracts expire in September.

"I like Alan Mulally but I just think it's morally wrong," said King. "And so will that give us more traction and more support to the membership to make sure that they get a very substantial size of that? Sure it will."

King said of stock bonuses of over $50 million awarded recently to Mulally, "I think it's outrageous, especially when there is so much poverty in this country and there are so many workers working extremely hard in the parts supplier sector and in temporary status at Ford."

Mulally is highly praised at Ford and in the auto industry for turning around Ford's fortunes since becoming CEO in 2006 without resorting to a U.S. government-sponsored bankruptcy as did GM and Chrysler.

In 2007, the UAW contracts with the three Detroit automakers allowed a wage of less than $15 per hour, about half of what veteran UAW hourly employees were paid, as parts of a concessions package to make domestic automakers more competitive during hard economic times.

King said the union this year will have to decide the point at which some concessions from 2007 can be taken back while still keeping the U.S. automakers competitive.

King said that the trend for companies to hire temporary workers instead of full-time ones is a global trend, but in a speech he made earlier on Tuesday, he once again singled out Ford for criticism.

"I used Ford as an example today because of the glaring disparity between those workers" and others who work full-time at Ford, he said.

Temporary workers "played a critical role in the success of Ford and they deserve decent middle class wages," King said.

King said his comment on Mulally's compensation does not mean Ford will be the "target," of upcoming negotiations in which the UAW enters talks with one automaker that set the pattern or general outline for talks with the other two.

King said he has not chosen either the U.S. automaker to be the first the union will negotiate with or which non-U.S. automaker will be targeted when the union intensifies its efforts this year to organize non-U.S. auto companies that have U.S. plants.

Chrysler exited bankruptcy under the management control of Italy's Fiat SpA (FIA.MI).

(Editing by Steve Orlofsky)

We welcome comments that advance the story through relevant opinion, anecdotes, links and data. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. For more information on our comment policy, see
Comments (1)
johnsonjet wrote:
When one considers the generally sorry automotive product history of GM, Chrysler and a few others over the past five decades, it appears extremely fortunate the USA has left any viable homegrown auto industry. It is now obvious that successfully operating an auto manufacturer and dealer system is an extremely complex undertaking.

With the sorry recent history of GM and Chrysler in mind, and with all due respect to UAW’s President Bob King, his comments regarding Ford CEO Alan Mulally’s compensation appear policially motivated, unbalanced, repugnant, morally deficient, carping and ungrateful.

There is simply no comparison when one considers the relative risk’s assumed by UAW’s Mr. King and the rank and file UAW auto worker in taking Ford to where it is today v the the risks taken by Ford, their CEO and shareholders. Case in point: UAW also built GM and Chrysler automotive products and consider theri generally failed market performance.

As much as we may not like to acknowledge the facts, history illustrates UAW workers are not “the critical factor” in fielding successful automotive products.

That leaves one key critical factor: the CEO and his team responsible for taking and executing decisions that drive market acceptance of a UAW built product and which determine the financial success of the company and its ability to well compensate its UAW line workers.

Always Go with Great Leadership: in terms of compensation, it is worth every dime every time and many times its weight in gold.

I have no interest in the industry, except as a consumer of mostly German built vehicles for several decades.

Mar 22, 2011 11:09pm EDT  --  Report as abuse
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.