With General Motors in bankruptcy, it was only a matter of time before pensions came under scrutiny. The Detroit News is reporting that GM CEO Fritz Henderson has confirmed that executive pensions beyond $100,000 per year will be cut by two-thirds. Recently defenestrated boss Rick Wagoner will likely take the biggest hit of all – he was supposed to receive $22 million over five years as part of his retirement package, but that number will reportedly drop by up to $15 million.
The move by GM mirrors closely that of Chrysler, which also took an axe to its executive retirement pay structure. Ex-CEO and one-time company savior Lee Iacocca lost his company car and may lose some or all of his monthly stipend, and he is now representing 1,200 ex-Pentastar employees protesting the move. Chrysler retirees have been lumped together with the Pentastar's other creditors, and it will be up to a judge to determine what amount they will receive in the months and years ahead.
[Source: Detroit News | Image: Bill Pugliano/Getty]