The chief executives of the Big Three automakers might give up most of their salary if they get assistance from the federal government.
Ford CEO Alan Mulally, General Motors CEO Rick Wagoner and Chrysler CEO Robert Nardelli all pledged to earn $1 a year in salary as part of their respective companies' plans to remain profitable. That is, if the government helps them out and if they take that help.
This is in stark contrast to two weeks ago when Mulally and Wagoner rejected a suggestion from Congress that they slash their salaries to $1 a year.
Rep. Peter Roskam, of Illinois, asked the CEOs if they would cut their salaries in exchange for federal aid.
"I don't have a position on that today," Wagoner said.
"I understand the intent, but I think where we are is okay," Mulally said. Pressed further, he added: "I think I'm O.K. where I am."
Yesterday was a different story.
"The plan calls for shared sacrifice, including further reduction in the number of executives and total compensation paid to senior leadership," GM said in a news release. "For example, the chairman and CEO will reduce his salary to $1 per year. The plan also requires further changes in existing labor agreements, including job security provisions, paid time-off and post-retirement health-care obligations. The common stock dividend will remain suspended during the life of the loans."
What was unclear Tuesday was whether that $1 salary is for 2009 and whether the executives would still get stock options, retirement benefits and other perks.
These three CEOs aren't the first corporate bigwigs to forgo their salaries and they probably won't be the last.
The $1 salaries are meant to be a symbol to shareholders, employees and taxpayers that the bosses are doing everything possible to fix their companies' problems.
In the last year, the chief executives of 32 companies in the Russell 3000 took $1 or no base salary, according to executive compensation firm Equilar.
But this handful of executives still earned millions of dollars through stocks and other forms of compensation, according to data provided by the Corporate Library, a research firm that tracks executive compensation based on company filings with the Securities and Exchange Commission.