Marchionne says he won't jack up Chrysler executive pay with cap gone

Chris Shunk — Fri, 29 Jul 2011 11:01:00 EST

Last week, Chrysler was able to pay off its remaining $560 million in government debt. That's big news for Team Pentastar for many reasons, including reduced interest payments and increased control over its own future. Another, less publicized reward is that Chrysler no longer is required to adhere to the government's strict $500,000 executive pay cap, but that doesn't mean company brass can expect the fat checks to come rolling in.

Automotive News reports that Chrysler CEO Sergio Marchionne will continue to keep a tight rein on executive pay. The outspoken chief executive reportedly said during a conference call that any thoughts of "distributing cash indiscriminately are probably misplaced." Having said that, Marchionne also adds that Chrysler intends to remain competitive with regards to wages, yet restraint will continue to be used.

While Marchionne is downplaying the fact that Chrysler no longer has a $500,000 executive pay cap, we're guessing that the automaker's top management talent is thrilled about the possibility of future pay hikes.

Marchionne says he won't jack up Chrysler executive pay with cap gone originally appeared on Autoblog on Fri, 29 Jul 2011 11:01:00 EST. Please see our terms for use of feeds.

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Officially Official: Chrysler exiting bankruptcy, Fiat steps in and makes changes immediately

Frank Filipponio — Wed, 10 Jun 2009 13:28:00 EST

Filed under: Government/Legal, Hirings/Firings/Layoffs, Chrysler, Earnings/Financials, Fiat

Fiat now owns a big chunk of Chrysler. Officially. Soon after the Supreme Court gave it the go-ahead, the sale of Chrysler to Fiat was complete. Altogether, the deal took just 42 days. With a couple of signatures and a wire transfer Wednesday morning, the sale was official. Fiat gets most of Chrysler's assets and $6.6 billion in "exit financing" from the federal government.

This can be seen as a victory of sorts for the Obama Administration, which had hoped to get Chrysler reorganized quickly and efficiently. Supporters say that the new Chrysler Group LLC has a good chance of being more competitive out of the box, having shed much of its legacy labor costs and debt, and Fiat's expertise with small cars shouldn't hurt either.

Official statements by current Chrysler CEO Bob Nardelli and Fiat's Sergio Marchionne are pasted in after the jump. Nardelli congratulates employees on being a part of "a leaner, healthier and more robust company," and says goodbye at the same time. He will return to a position with Cerberus. Marchionne introduces himself as the new CEO, former Toyota exec Jim Press as Deputy CEO, and Robert Kidder as board chairman. He also promises that the world's sixth largest automaker will begin to show signs of improvement immediately.

In related news, the Obama Administration has announced the appointment of a new 'Compensation Czar' to oversee the salaries and benefits packages awarded to 175 major executives at seven of America's biggest companies that receive federal aid. According to the New York Times, Washington attorney Kenneth R. Feinberg will have "broad discretion" in determining what compensation packages executives are awarded, including the top 25 decision makers at General Motors, GMAC, Chrysler, and Chrysler Finance.

For its part, as it emerges from bankruptcy, Chrysler's union retiree trust (VEBA) will own 55% of the company, with Fiat getting a 20% share that can grow to a max of 35%. The U.S. and Canadian governments split the rest. If the Fiat-Chrysler deal is any indication, General Motors may see a quick exit from bankruptcy as well, even without a Fiat of its own to step in and help. Now they just need to get people into showrooms with cash in hand.

[Sources: Chrysler, The New York Times | Photo by Sean Gallup/Getty]

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Officially Official: Chrysler exiting bankruptcy, Fiat steps in and makes changes immediately originally appeared on Autoblog on Wed, 10 Jun 2009 13:28:00 EST. Please see our terms for use of feeds.

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