On April 15, Stellantis Group approved a 23.09 million euro (about 192 million yuan) salary package for former CEO Carlos Tavares, who left the automaker in December 2024.
Investors had previously objected to Tavares' 2024 pay package, which included his salary and an additional 120 million euros in severance and milestone bonuses in 2025.
Shareholders voted 66 percent to 33 percent in favor of Tavares' pay plan at the annual general meeting, during a tenure that has been marred by falling U.S. demand, delays in developing European models and clashes with politicians, dealers and unions.
Carlos Tavares
Technological change, conflict between nations and consumer behavior have failed to change the fact that the automotive industry remains one of the most profitable in the world. Although CEO compensation in this industry varies from person to person, the standard is the same: leaders who can lead industry giants to new heights and set new records with outstanding financial performance.
The financial impact of this compensation package is reflected in the continuous adaptation in the face of new demands and global challenges. The growing pressure on automakers to strive for sustainability, innovation and competitiveness has led to increased investments in new technologies and significant investments in production diversity. This high level of responsibility and the impact these leaders have on the transformation of the automotive industry can be understood by looking at the salaries of the highest paid CEOs in the field.
In 2024, a large portion of executive compensation came from equity incentives, reinforcing the link between CEO pay and company performance. While base salaries remained relatively stable, large stock grants and bonus packages pushed total compensation to record levels.
The continued rise in CEO pay has fueled debate about income inequality and corporate governance as critics argue executive compensation remains too high compared with salaries for rank-and-file workers, many of whom are facing economic hardship, inflation and job insecurity.
Let's take a look at the pay structure of the CEOs of the automotive giants, their relationship with revenue and profits, and the gap with ordinary employees, and speculate how CEOs will adjust their pay structure in 2025. Will more companies implement performance-based pay caps? Or will executive pay continue to rise?
General
GM CEO Mary Barra, who was named chairman and CEO of the U.S. auto giant in 2013, is the highest-paid executive among the "Detroit Big Three" automakers (GM, Ford and Stellantis) through 2024.
Mary Barra received $29.5 million in compensation last year, a 5.9% increase in her pay as the automaker delivered strong earnings and successfully met key business goals.
According to an April 11 filing with the U.S. Securities and Exchange Commission, Barra's base annual salary is $2.1 million, unchanged in 2022 and 2023. Her stock awards increased 33% to $19.5 million, but options fell to zero from $4.9 million in each of the past two years. Compensation from non-equity incentive plans increased 27% to $6.7 million.
GM's annual report said the company's net profit in 2024 was $6 billion, down 41% from the previous year, but pre-tax profits climbed to a record $14.9 billion. Hourly workers represented by the United Auto Workers (UAW) received record profit-sharing checks of up to $14,500.
Barra's compensation in 2024 was 310 times its median worker's pay of $95,111, and 303 times in 2023, when the company said its median worker pay was $91,778.
Ford
Jim Farley, Ford's chief executive since February 2020, saw his total compensation fall 6.1% in 2024 to $24.86 million from $26.47 million the previous year as Ford failed to meet key performance targets, highlighting the challenges the automaker faces in achieving key goals related to global electric vehicle sales, connected services, revenue growth and overall quality improvements.
Ford Motor's full-year operating revenue in 2024 reached $185 billion, up 5% year-on-year, a record high. Net income was $5.879 billion, up 35% year-on-year. But the company only achieved 90% of its earnings target, 88% of its electric vehicle retail sales target, and did not achieve its quality target.
Shortfalls in the company's annual performance bonus indicators led to reduced bonus payments for executives, including a business performance coefficient of only 69% due to difficulties with quality indicators. Ford's board of directors also aims to assess adjusted earnings before interest and taxes (EBIT) before taxes, but incentive compensation for senior leaders has been reduced due to poor company performance. Ford stressed that these results are in line with its performance-based compensation structure, which holds executives accountable for performance at both the individual and corporate levels.
Farley's base salary remained at $1.7 million, and his stock awards were about $300,000 higher than a year ago due to a change in accounting formulas, bringing his stock awards to an estimated $20.6 million, though most have yet to vest. His non-equity incentives were reduced by $780,300, and other compensation, including travel benefits, fell 56% year-over-year.
In addition, the ratio of CEO compensation to median employee compensation declined in 2024. Farley's total compensation fell to 253 times the median compensation of all Ford employees from 312 times in 2023, the smallest gap in three years. This is due to the median annual total compensation of all Ford employees being $98,273, about $14,000 more than a year ago.
Stellantis
Carlos Tavares, the former CEO of Stellantis Group who left in December last year, received 23.09 million euros (about 26.16 million US dollars), a decrease of 36.75% from 2023.
His compensation includes a basic salary of 2 million euros, additional benefits of 71,224 euros, long-term incentives of 20.51 million euros, and post-retirement benefits of 500,000 euros.
As Stellantis' first CEO since 2021, Tavares clashed with the group's board of directors over his focus on cutting costs in the short term rather than looking at longer-term goals. His aggressive pricing strategy led to a sales slump in the U.S., which the automaker is still trying to recover from.
The financial report shows that Stellantis Group's net revenue for the whole year of 2024 was 156.9 billion euros, a year-on-year decrease of 17%; net profit fell 70% year-on-year to 5.5 billion euros; adjusted operating profit was 8.6 billion euros, a decrease of 64%.
Stellantis' stock price has fallen about 50% in the past 12 months. Before last year's poor performance, Tavares' compensation in 2023 increased by 56% to a total of 364.9 billion euros. Shareholders have voted against his pay plans in the past.
Stellantis said its employees will receive an average salary of about 66,000 euros in 2024, down 6% from 2023. Tavares' total compensation is 350 times the average salary of an ordinary employee.
public
Although Volkswagen's profits fell by a third last year, its chief executive Oliver Blume's pay rose.
As CEO of Volkswagen Group and subsidiary Porsche, he received 10.346 million euros (about 11.775 million U.S. dollars) in 2024, according to the group's annual report, an increase of 6.5% from 9.7 million euros in the previous year, including many years of pension and bonus incentives.
In 2024, Obermu gave up 5% of his fixed salary at Volkswagen, and his basic salary dropped from 1.3 million euros to 1.235 million euros. Volkswagen's bonus incentives were also slightly lower than before. In return, Porsche's basic salary increased to 1.085 million euros.
His additional benefits amounted to 2.683 million euros, including 2.002 million euros in short-term incentives from the Volkswagen Group and 1.334 million euros from Porsche; long-term incentives were 2.715 million euros; other remuneration was 466,000 euros and pension expenses were 1.149 million euros.
Volkswagen Group's net profit plunged 30.6% to 12.39 billion euros in 2024 as Europe's largest automaker grapples with slowing demand, rising costs and growing competition from Chinese manufacturers.
Volkswagen production line employees: monthly salary of about 4,100 euros (before tax), annual income of about 56,000 euros (including bonuses), some employees can also receive night shift or weekend allowances. Blume's salary in 2024 is 185 times this figure.
It is worth mentioning that although the former CEO of Volkswagen Group, Herbert Diess, has left, he can still receive a considerable pension from the Volkswagen Group. His income in 2024 is expected to be about 11.2 million euros, exceeding that of Blume.
Benz
Ola Källenius, Chairman of the Board of Management (CEO) of Mercedes-Benz, who took office in May 2019, has a target total compensation of 7.544 million euros (about 8.586 million US dollars) in 2024, an increase of 10.14% from 6.849 million euros in 2023.
Mercedes-Benz CEO's remuneration mainly includes basic salary, short-term incentives, long-term incentives, benefits and preferential conditions. Due to the uncertainty of the bonus incentive part, the company's CEO remuneration is also called target remuneration.
In 2024, Kallenius' basic salary will be 1.876 million euros, taxable non-cash benefits and fringe benefits will be 505,000 euros, short-term incentives will be 1.876 million euros, long-term incentives will be 2.717 million euros, and pension expenses will be 570,000 euros.
Mercedes-Benz CEO compensation is based on performance indicators such as sales growth, profit margins and market share, aligning leadership incentives with company goals by tying executive compensation to performance indicators.
Data shows that in 2024, the total sales volume of Mercedes-Benz passenger cars will be 1.9834 million units, a decrease of 60,648 units from the previous year, a decrease of 3.0%; sales in the Chinese market will be 683,600 units, a year-on-year decrease of 7.3%, of which the sales volume of domestically produced Mercedes-Benz in China will be 563,100 units, a year-on-year decrease of 4.7%.
In 2024, Mercedes-Benz's total revenue was 145.6 billion euros, down 4% from the previous year; its net profit before interest and taxes (EBIT) was 13.6 billion euros, down 6.061 billion euros from the previous year, a sharp decline of 31%.
In 2024, Mercedes-Benz will have about 170,000 employees (including temporary workers) worldwide, with a total wage expenditure of about 14 billion euros and an average annual salary of about 82,400 euros. Kallenius's target salary is 92 times the average annual salary of ordinary employees. If equity incentives and actual bonuses are taken into account, the actual gap may exceed 100 times.
BMW
According to BMW's annual report, Oliver Zipse, who was promoted to Chairman of the Board (CEO) in August 2019, has a target salary of 7.128 million euros (about 8.113 million US dollars) in 2024, which is basically the same as 7.126 million euros in 2023.
Basic salary is directly linked to job responsibilities; short-term incentives are related to the company's annual financial goals (such as revenue, profit, cash flow) and personal KPIs (such as progress in electrification transformation); long-term incentives include equity incentives and pension plans; other benefits include company cars, housing subsidies, etc.
In 2024, Zipse's fixed income will be 2.6779 million euros, including a basic salary of 1.95 million euros, additional benefits (other remuneration) of 27,963 euros, and pension expenses of 700,000 euros; his financial incentives will be 2.1 million euros and basic stock compensation will be 4.45 million euros.
Zipse's salary is highly linked to the company's performance. In 2024, BMW Group's annual revenue was 142.38 billion euros (a year-on-year decrease of 8.4%), and its pre-tax profit was 10.97 billion euros (a year-on-year decrease of 35.8%), mainly affected by the decline in sales in the Chinese market (revenue decreased by 22%) and increased R&D investment.
The short-term incentive part directly reflects the achievement of profit targets. For example, when BMW's profits hit a record in 2021, Zipse's annual salary reached 8.75 million euros; but in 2024, due to the decline in profits, the bonus was reduced and the salary also decreased.
The total number of employees of the BMW Group at the end of 2024 was 159,104, a slight increase from the previous year. BMW employees usually enjoy performance bonuses (about 14% of monthly salary), vacation allowances (69% of monthly salary) and profit sharing bonuses.
According to Payscale.com, the average annual salary of BMW employees in Germany is 67,942 euros. If calculated at 68,000 euros, Zipse's salary is about 105 times the annual salary of an ordinary employee. If equity incentives are included, the actual gap may be even greater.
(Original title: "How much does an automotive CEO earn in a year? 350 times more than an employee")