It’s probably safe to say that no Fortune 500 CEO is hurting for money, but Ford’s Jim Farley saw his bank account balance grow by a little less than expected in 2024. His compensation dropped by more than $1.5 million dollars due to the automaker failing to hit its sales targets.
While inflated, executive compensation is generally tied to the company’s performance goals, which are set by the board. Ford’s financial filing stated, “Our overall achievement against the targets set for our 2024 Annual Performance Bonus Plan yielded a business performance factor of 69 percent. This result was largely driven by challenges in the quality metric. The Committee believes the final 2024 payouts for the Named Executives are consistent with the performance-based nature of the Annual Performance Bonus Plan, holding executives accountable for and emphasizing the importance of both their individual performance and the performance of the company.”
Did you catch that first part? A significant portion of Ford’s financial challenges come from quality issues, with recall and warranty repair costs remaining elevated. Some of the shortfall also likely relates to Ford’s EV sales and profitability, but those losses were probably built into the budget.
Despite the decrease, Farley’s salary remains 253 times higher than the average Ford worker, though that fell from 312 times in 2023. That said, Ford’s median wage (excluding Farley’s salary) reached more than $98,000 last year, a $14,000 increase over 2023.
[Images: Ford]
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