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Old 11-14-2008, 12:27 PM   #1
AVANTI R5
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Default Chrysler paying executive bonuses while cutting jobs

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Despite the fact that Chrysler LLC is shedding jobs and drastically cutting spending in order to stay afloat, a new report today reveals that the automaker is paying out incentives to 50 of its top executives. The retention bonuses are part of an incentive plan crafted last year by DaimlerChrysler when the automaker was selling Chrysler to Cerberus Capital Management LC.

At the time, the bonuses were designed to keep Chrysler executives on board when the company was being transferred to the private equity firm. These retention programs are common practice when a company becomes private as it helps ensure potential buyers that key executives won’t rush away from the company, says the Detroit Free Press.



At least six Chrysler executives are promised $1 million or more bonuses if they stay with the company through August 2009, the newspaper says. The other 44 bonuses are still worth more than $200,000 at the minimum.



The initial agreement said that 25 percent of the bonus would be paid in February 2008 and the remaining 75 percent would be paid out next August. This comes at a time when Chrysler is shedding jobs left and right to keep its costs down. The automaker has announced nearly 35,000 job cuts since February of 2007.



The controversial bonuses have met mixed reaction from analysts.


John Challenger of Challenger, Gray and Christmas of Chicago, a human resources consulting firm, said, “To get good people, the right people, then you often have to pay retention bonuses - otherwise they just won’t come or they won’t stay.”



Still, the United States government, particularly House Speaker Nancy Pelosi, has vowed to prevent big bonuses to executives as a condition of federal aid. The automakers are seeking for the $700 billion U.S. government bailout of troubled financial firms to be changed to cover the auto industry.
http://www.leftlanenews.com/chrysler...ting-jobs.html
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Old 11-14-2008, 12:39 PM   #2
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yeah, dump more of my money on tehm
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Old 11-14-2008, 12:42 PM   #3
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WOW and you would think with the way the economy is today that them HAVING a job would be a big enough incenitive
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Old 11-14-2008, 12:43 PM   #4
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And keeping the existing executives is good because ...... why?

Where are these right people... I have a clue, they are at a company that rhymes Monda and Boyota
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Old 11-14-2008, 12:59 PM   #5
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eh what else is new in corporate america?
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Old 11-14-2008, 01:05 PM   #6
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I'm curious if Chrysler even has defined, measurable performance standards and expectations for those at the top. I wonder this, because it seems the general rule is that the worse your company does in this economy, the more those at the top are rewarded.

-Mike
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Old 11-14-2008, 01:09 PM   #7
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And people actually wonder why the big 3 are in trouble?
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Old 11-14-2008, 01:26 PM   #8
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This does not surprise me. It's only a matter of time now. In a free market economy those with better selling products survive.
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Old 11-14-2008, 01:30 PM   #9
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Originally Posted by ghibli99 View Post
I'm curious if Chrysler even has defined, measurable performance standards and expectations for those at the top. I wonder this, because it seems the general rule is that the worse your company does in this economy, the more those at the top are rewarded.

-Mike
but when the economy does well, the execs also get rewarded nicely... its just that people complain more when economy is crappy.

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And people actually wonder why the big 3 are in trouble?
aww com'on... who isnt rewarding their execs?... so this cant be the reason why the big 3 are in trouble!
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Old 11-14-2008, 01:35 PM   #10
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but when the economy does well, the execs also get rewarded nicely... its just that people complain more when economy is crappy.
No, bonuses should be paid based on how a company performs. If your company's tanking, million dollar bonuses shouldn't even be in the picture. If you need to pay someone that much just to keep them from running away, let them go. Just my opinion, but that person probably didn't have the company's wellbeing as a priority in the first place if money's the only thing preventing them from jumping ship.

-Mike
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Old 11-14-2008, 01:52 PM   #11
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Originally Posted by Chris_Lee View Post
This does not surprise me. It's only a matter of time now. In a free market economy those with better selling products survive.
Too bad we don't have a free market economy.
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Old 11-14-2008, 02:47 PM   #12
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The bonuses were part of a contract. If they didn't pay the bonuses, they'd be sued for more than the bonus... and lose even more money.

Bonuses shoudl be removed from the contract... and good luck with that.

--KC
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Old 11-14-2008, 02:59 PM   #13
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This is always a sign of a good, healthy company that will be lasting long in to the future...

Vostok 7
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Old 11-14-2008, 05:36 PM   #14
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All the more reason to have executive compensation limits be part of any and all bailout money, cuz lord knows that Corporate America's greed knows no bounds.
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Old 11-14-2008, 05:43 PM   #15
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The bonuses were part of a contract. If they didn't pay the bonuses, they'd be sued for more than the bonus... and lose even more money.

Bonuses shoudl be removed from the contract... and good luck with that.

--KC
Can't sue a company that's out of business now can ya?
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Old 11-14-2008, 05:43 PM   #16
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That is crazy. I'm not an executive BUT if I was making a very decent salary and the economy is slipping and all, I would at least deny the bonus and possibly take a pay cut.

Also, as stated before there is insentive even just having a job.

Steve
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Old 11-14-2008, 05:55 PM   #17
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All the more reason to have executive compensation limits be part of any and all bailout money, cuz lord knows that Corporate America's greed knows no bounds.
SOCIALISM!!!!!!!!!!!!!!!!!!!!!!!!!!!!1111111111111 1one

But seriously, lemme give you a phatty +1 on that.
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Old 11-14-2008, 09:27 PM   #18
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Originally Posted by jetfan2207 View Post
That is crazy. I'm not an executive BUT if I was making a very decent salary and the economy is slipping and all, I would at least deny the bonus and possibly take a pay cut.

Also, as stated before there is insentive even just having a job.

Steve
See- that's why you're not an executive, you got the completely wrong mindset for it
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Old 11-14-2008, 09:32 PM   #19
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top executive+chrysler= does not compute
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Old 11-14-2008, 09:45 PM   #20
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I think I said it when they hired him... Will Cerberus give Nardelli more to go away than Home Despot did?
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