In a situation that happens regularly, Ford Motor Co. (NYSE: F) will cut 10% of its worldwide workforce, but CEO Mark Fields, who caused the company’s problems in the first place, will keep his job and his salary.
According to Reuters, reports of a 10% across the board cut may not be true. The news agency says it will be 10% of the salaried workforce in Asia and North America. At any rate, the cuts will be in the thousands.
CEO Fields made $21.1 million last year and nearly $19 million the two years prior. William Clay Ford, the executive chairman, made $13.9 million. The sums are extraordinary given Ford’s problems.
Over the past two years, Ford’s shares are down 30%. Shares of rival General Motors Co. (NYSE: GM) are off 4% during the same period, and Fiat Chrysler Automobiles N.V. (NYSE: FCAU) shares are up 9%.
Ford has bungled several opportunities, leading to among other things a lack of success in the critical European and Chinese markets. Ford has to thrive in these markets to be a global success, but its market share in both regions is mediocre. Its U.S. business has slipped. Its domestic sales are off 5.1% to 826,981 over the first four months. The figure would be worse if sales of its flagship full-sized pickup F-Series were not up 7.4% to 275,938.
Ford also has been slow into the driverless and electric car businesses. Google and Tesla Inc. (NASDAQ: TSLA) are widely seen as well ahead of Ford. So is GM, which has launched the inexpensive electric car the Chevy Bolt. Several other companies, including BMW and Volvo, are also considered well ahead of Ford.
According to the Detroit Free Press, at Ford’s annual meeting:
Ford assured shareholders that company’s stock price matters both to the Ford family and Ford’s top management but pointed out that Wall Street has historically undervalued automakers, even when they make millions in profits.
That is if the car maker is Ford.