• Jun 10, 2010
According to Bloomberg, Nissan is the place to be a director for a Japanese automaker. According to a new article, Nissan Motor Company hands its directors close to four times the amount of pay as its rival Toyota and three times as much as what Honda directors bring home. Averaged among all of Nissan's directors, the heads of the company make around $1.5 million per year, compared to around $411,150 for Toyota's gurus and $529,561 for Honda's head honchos. Keep in mind those numbers are based on current conversion rates.
So what gives? For one, Nissan is shacked up with Renault at the moment, giving the company a bit of an international flavor and the pay scales that comes along with that association, but a bigger factor may be that Toyota and Honda compensate their heads of state in other ways. Toyota, for example, hands out stock options worth around $171,000 in addition to base salary in order to help make up some of the gap.

Despite the massive amounts of cash heading to Nissan's directors, the company can't quite keep up the pace in either profits or sales with its main domestic rivals. The company fell dead last among the big Japanese three in sales for the past year.

[Source: Bloomberg]


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  • 21 Comments
      • 4 Years Ago
      Compare this with the sorry state of affairs here in corporate america.
      • 4 Years Ago
      Actually, the salaries for japanese execs is about right. This has always been the norm. I am more bothered by how much the execs for GM, Chrylser and GM got when they were releasing crappy quality auto's in the 90's and early 2000's. Anyone remember Jacques Nasser!?
      • 4 Years Ago
      back in the 80's Lee Iaccoa was making $987,000 per year with stock options.......
        • 4 Years Ago
        Back in the 80's, $1M was also a much bigger deal than it is today.
        • 4 Years Ago
        @bassplayer, but I suspect that $1 bought you more goods back in 1980 than presently.
      • 4 Years Ago
      Just to let you know that Nissan is a French-owned company that builds cars the French way.

      Nissan also pays its executives the French way.
        • 4 Years Ago
        No. Nissan is owned by its shareholders. Nissan has been in an alliance with Renault for the last 10 years or so where both companies own a controlling interest in the other. Nissan is still a Japanese based company and Renault is still a french based company.

        It should also be noted that Nissans sales have been growing much faster then Hondas over the past 12-18 months, at the current rate Nissan will pass up Honda as the #2 Japanese automaker within the next 1-2 years.
      • 4 Years Ago
      $400,000 is very little for the head of the gigantic company Toyota is....many doctors make more than that!

      But that's how Japanese firms operate, work yourself to death for little money.
        • 4 Years Ago
        This article tells me the Nissan directors are overpaid, rather than Toyota and Honda ones are underpaid, and that paying someone 3-4 times more doesn't get you better result.

        If I were running Nissan, I'd cut the directors pay 2/3rd. I bet most of them will still stick around, or there will be plenty of other qualified people eager to fill the position.

        When someone earns millions in salary, that's a sign of inefficient and corrupt system. Rarely is someone worth that much.
        • 4 Years Ago
        @hypermiler

        I wonder if the gov in Japan regulates incomes!

        Also, if those calculations should be used in China (the 10 to 1) thing. Because if someone's making 65 cents a day to work 14 hours and make cell phones for the world, then the guy running it should only get $6.50 for the day!

        Bastards
        • 4 Years Ago
        That's the Japanese way.

        Average pay ratio between CEO and a low-end full time employee.

        USA : 100:1
        Japan : 10:1
        • 4 Years Ago
        I think Mr. Toyoda has share in the company. 400k/year doesn't bother him much.
        • 4 Years Ago
        Difference is, Toyota and Honda are still traditional Japanese companies where they still have the lifetime employment (at least for the Japanese people). So in return for a lower salary they know that they can work there untill they retire (and even after that be a part of the company). Nissan changed with Renault/Ghosn. When Ghosn took over Nissan, he broke with tradition and cut jobs and closed plants in Japan. Or in other words, Nissan now needs to pay a higher salary to compensate for not offering lifetime employment.
      • 4 Years Ago
      Not surprised in the slightest bit.

      Nissan has Western influence with it's connection with Renault. Japanese companies tend to be much more flat in their pay-scale than most Western countries. That pays huge dividends to them in keeping down employee animosity between the higher-ups and the lower-level workers, and of course it helps the bottom line which greatly helps competitiveness... a few million less in payroll can be invested back into the company to improve efficiency, product, etc.

      The West (the US in particular) loves to over-pay executives at the expensive of the company's competitiveness as a whole, and usually done by lowering pay for everyone else. And then people wonder why most Western workers have such less loyalty to their company.
      • 4 Years Ago
      Is this a case of you get what you pay for?

      Honda's sales performance these last few months has been basically stagnant as most everyone else improved dramatically (and their latest products aren't exactly award-winning).

      Toyota has obviously been dealing with the fallout from their recall scandal, a direct result of growing too quickly at the expense of quality.

      Following their alliance with Renault, Nissan's sales and quality have both been improving year over year. I'd say that the extra money is worth it.
      • 4 Years Ago
      "But that's how Japanese firms operate, work yourself to death for little money."

      As opposed to the American way, where you work other people to death for a hell of a lot of money.
      • 4 Years Ago
      "The company fell dead last among the big Japanese three in sales for the past year."

      That's an interesting spin, IMO. "Dead last" implies something far worse then if they had just said, "Nissan came in third in sales" or that they "finished third behind Toyota and Honda." I wonder how their salaries compare to Mazda, Subaru, Mitsubishi, and Suzuki execs?
      • 4 Years Ago
      Probably compared to about $150 million for GM and Chrysler pre-bailout.
        • 4 Years Ago
        I don't think 400K is "pitiful"-it's not the truckload of cash that execs elsewhere get but those stock options add up over time and mostly Toyota ends up with execs who are there because they're loyal to and care about the long term prospects of the company. Career exec types who jump from company to company obviously despise that kind of thing, but since Toyota's stock price has gone up quite a bit over the years those execs who got a little bit of stock options every year over the last 20 years are all pretty well off because what started as a joke compared to what other companies paid is certainly worth a decent amount of money now.
        Not Wagoner-style ultra-overpaid-insanity pay, but they're certainly not starving. Maybe the goal of a good executive team should be to do what's best for the company and not just to rob as much money as possible for their own pockets while alienating workers (who don't exactly appreciate seeing execs get millions while they're getting laid off).
        A lot of Japanese companies have execs like this though and I don't think it makes them worse off. It makes it hard to go after superstar execs (like Mulally) but at the same time it also prevents you from overpaying greedy idiots who plan on ditching your company the moment someone else offers them more money.
      • 4 Years Ago
      damn yo.. umm..i wouldnt complain abt 400,000 a year..but what the hey..
      1.5mil sheeeba
      • 4 Years Ago
      Probably a result of those continuous GT-R price hikes... haha.
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