Stellantis CEO compensation up following record 2023

The 2023 pay package for the CEO of Stellantis NV totaled $39.491 million (36.494 million euro) in direct compensation, non-vested stock grants and other benefits, following a record year for the company.

Carlos Tavares is the CEO of the maker of Chrysler, Dodge, Jeep, Ram and other vehicles. His total 2023 remuneration, disclosed in an annual report with the U.S. Securities and Exchange Commission, is a 56% increase from 2022, when his package was 23.5 million euro. The increase largely was attributable to $10.8 million (10 million euro) in one-time awards to Tavares for the company hitting the first three of seven "transformation incentive" milestone targets charted through 2025. Ninety-three percent of his compensation is variable.

The remuneration of Tavares, 65, is about 518 times as much as the company's average employee compensation of about $76,185 (70,404 euro). That average was up 9.4% year-over-year, widening the multiplier from 365 in 2022. Without the transformation incentive, the ratio was 315.

Tavares' 2023 compensation includes a base salary of $2.16 million (2 million euro), which was unchanged year-over-year, and $686,812 (634,697 euro) in fringe benefits, up more than 42 times.

The remainder of the package is based on performance. That includes a $6.262 million (5.787 million euro) bonus — a 27% year-over-year decrease — and long-term incentives of $28.271 million (26.126 million euro). That was up 125%, because of the transformation incentive. It also includes stock grants, the vesting of some of which will depend on the automaker's continued performance. There also was $2.107 million (1.947 million) for post-retirement benefits, down 18%.

"Actual compensation" consisting of Tavares' salary, bonus, transformation incentive, vested stock awards and pension contribution, according to the report, was $25.399 million (23.472 million euro), a 57% increase.

The company hit three of seven milestones to trigger the transformation incentives. Of the three of seven milestones hit to trigger the incentives, the first, achieving a 15% low-emission vehicle sales mix in Europe, happened in 2022, which didn't result in a cash reward. The start of production of e-motors at the company's joint venture with Nidec and the production launch of electrified dual clutch transmissions both happened in 2023, resulting in a $5.4 million (5 million euro) payout for each.

Last year was another banner year for Stellants, formed in the 2021 merger between Fiat Chrysler Automobiles NV and French rival Groupe PSA. Higher pricing fueled Stellantis NV to a record $20 billion (18.6 billion euro) net profit in 2023, an increase of 11% from 2022, on record net revenue of $203.4 billion (189.5 billion euro), up 6%. Global adjusted operating income margin fell to 12.8% from 13%, but still put it among some of the most profitable companies in the world.

Executive compensation was a major talking point from the United Auto Workers last year during national contract negotiations with the Detroit Three that resulted in historic gains, including a 27% compounded wage increase by 2028, cost-of-living adjustments, a shorter timeline to the top wage and increased pension and retirement contributions. The 40% increase in executive compensation over the previous four years cited by the UAW was largely attributable to the increase in pay from the FCA CEO pay in 2019 to Tavares' 2022 after the company roughly doubled in size from the merger.

As a part of the company's 2023 financial results last week, it announced 38,000 eligible workers represented by the United Auto Workers will receive profit sharing checks on Feb. 29. The payments were placed at $13,860 based on North American results, though distributions may be more or less depending on compensated hours.

In total, Stellantis says it will distribute globally $2 billion (1.9 billion) in profit sharing and variable bonuses for 2023. Last year, it said it was paying 2 billion euro in performance-based benefits for 2022.

The automaker said it also will expand its share purchase plan to 242,000 employees worldwide in 2024. The company last year launched a pilot version in Italy and France, extending a $1,073 (1,000 euro) matching contribution.

Stellantis in 2022 also had received criticism from shareholders, including the French government amid an election year, concerning Tavares' compensation. Last year following additional disclosures, shareholders approved the package by more than 80% in an advisory vote.

The other two Detroit automakers will report their executive compensations in the coming weeks. General Motors Co. CEO Mary Barra in 2022 received nearly $29 million in total compensation, including a $2.1 million base salary. The less than 1% decrease still made her the highest paid chief executive of the Detroit Three. Ford Motor Co. CEO Jim Farley's compensation in 2022 fell 8% to nearly $21 million, including a $1.7 million base salary.

Also last year, Stellantis chairman John Elkann, scion of the Fiat-founding Agnelli family, received $5.220 million (4.824 million euros) in total remuneration, an 18% decrease from 2022. Cousin Andrea Agnelli, a director on the board through April 12, 2023, received $67,788 (62,644 euro).

Stellantis paid vice chairman Robert Peugeot, head of PSA's founding family, a total remuneration of $234,739 (216,927 euro), down 1.2%.

Stellantis last week also proposed a dividend to shareholders of $1.66 (1.55 euro) per share, pending their approval at the April general meeting. It announced an open market share buyback program this year of $3.22 bullion (3 billion euro), as well.

bnoble@detroitnews.com

@BreanaCNoble