GM Cuts Cash Payout to CEO

DETROIT April 29, 2005; Reuters reported that cash compensation paid to General Motors Corp. Chairman and Chief Executive Officer Rick Wagoner fell by 43 percent last year, as its automotive operations lost money on weaker U.S. sales and market share.

GM, the world's largest automaker, also said in a securities filing on Friday that cash compensation paid to its top five executive officers fell 37 percent last year versus 2003.

GM's net earnings fell to $2.8 billion last year from $3.8 billion previously, due in part to a $886 million after-tax payment to Italy's Fiat SpA to dissolve a failed industrial partnership. Including that payout, GM's automotive unit posted a loss of $89 million versus a profit of $995 million in 2003.

GM recalled more than 11 million vehicles in 2004, a record for the automaker. GM's U.S. sales fell about 1.1 percent last year, cutting its U.S. market share to about 27.3 percent for 2004 from 28 percent in 2003, according to Autodata.

The Detroit automaker's fortunes have worsened this year. Earlier this month, GM posted a first quarter loss of $1.1 billion, including a loss of $1.56 billion in North America alone, its worst quarterly result since it skirted bankruptcy in 1992.

GM's financial deterioration has caused its shares to drop sharply, and ratings agencies to warn that it could downgrade the automaker's debt to "junk" status at any time.