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Government to slash Chrysler executive pay

by Bill Cawthon on

Top executives at Chrysler Group will soon see a major cut in their paychecks. As soon as today, the U.S. Treasury plans to announce new limitations on executive pay packages at companies that received the most government assistance under the Troubled Asset Relief Program (TARP). In addition to Chrysler, affected companies include General Motors, American International Group (AIG), Bank of America and Citigroup.

Kenneth Feinberg, special master at the Treasury, has been studying executive pay at the companies and, according to sources, plans to cut pay for the top 25 executives at each firm by about 50 percent. One insider told the Associated Press that no executive at AIG will receive more than $200,000.

It is unclear at this time whether Chrysler CEO Sergio Marchionne and some of the executives he brought from Fiat will be affected by the new measures. Marchionne is currently being paid by Fiat SpA which is not part of the government program.

Bill Cawthon grew up in the auto industry in the 1950s. His Dad worked for Chrysler and Bill spent a number of Saturdays down on the plant floor at Dodge Main in Hamtramck. Bill is also the U.S. market correspondent for just-auto.com, a British auto industry publication, and a member of the Texas Auto Writers Association, which has named the Jeep Grand Cherokee the “SUV of Texas” several times and named the Ram 1500 as the “Truck of Texas” two years running.

Bill has owned five Plymouths (including the only 1962 “Texan”), one Dodge and one Chrysler and is still trying to figure out how to justify a Wrangler. He also has owned at least one of every 1:87 scale model of a Chrysler product. You can reach him directly at (206) 888-7324 or by using the form.

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