Tag Archives: Dennis Muilenburg

Boeing vs. Airbus: CEO compensation (2017)

For the last 4 years I have been writting a small series of posts comparing the compensation of Airbus and Boeing CEOs (1). This series started out of conversation with colleagues and I keep it updated to have a record of the evolution and for quick reference in other conversations (2). Thus, this post is just the update with the information for the 2017 fiscal year.

As both Boeing and Airbus are public companies, the information about their CEOs compensation is public and can be found in the annual report and proxy statement from each one. I just share the information and sources below for comparison and future reference.

Airbus CEO, Tom Enders’ 2017 compensation (financial statements here, PDF, 4.0 MB, page 58):

Enders_2017

Airbus CEO Tom Enders 2017 compensation.

Enders saw his base salary frozen in relation to 2016 at 1.5 M€. Variable pay decreased in 7.3%, post-employment benefit costs increased, etc. The main change in last year’s remuneration was the line “Termination benefits”, which in the notes it is explaiend as stipulated in 1.5 times the “Total Target Remuneration (defined as Base Salary and target Annual Variable Remuneration)”, as Enders announced that he will retire from the post when his current term expires in 2019. Thus, the overall compensation (9.1 M€increased.

Boeing CEO, Dennis Muilenburg’s 2017 compensation (2018 proxy statement here, PDF, 6.7 MB, page 30):

muilenburg_2017.png

Boeing’s CEO Dennis Muilenburg 2017 compensation.

Dennis Muilenburg saw his base salary increased in 50 k$. And with that all other incentive and other compensation concepts. The total compensation (18.45 M$) increased in relation to 2016 and has now raised above the 2014 levels (17.8 M$).

Comparison. It is interesting to note that while the base salary is nearly the same, 1.5 m€ vs 1.69 m$ (more so taking into account average exchange rates in 2017 (~ 1.13 USD/EUR)), the incentive schemes at Boeing end up with a total remuneration for the CEO about the double (x1.8) of that in Airbus.


(1) See the previous comparisons for the years 20132014, 2015 and 2016.

(2) From what I see in the stats of the visits to this blog, other people are having similar conversations as these posts with the compensation comparison have ranked among the top 10 most read ones the last years.

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Boeing vs. Airbus: CEO compensation (2016)

For the last 3 years I have been writting a small series of posts comparing the compensation of Airbus and Boeing CEOs (1). This series started out of conversation with colleagues and I keep it to have a record of the evolution and for quick reference in other conversations (2). Thus, this post is just the update with the information for the 2016 fiscal year.

As both Boeing and Airbus are public companies, the information about their CEOs compensation is public and can be found in the annual report and proxy statement from each one. I just share the information and sources below for comparison and future reference.

Airbus CEO, Tom Enders’ 2016 compensation (financial statements here, PDF, 1.0 MB, page 59):

Enders_2016

Airbus CEO Tom Enders 2016 compensation.

Enders saw its base salary increased in 100 k€ after 3 years at 1.4 M€. Variable pay also increased substancially, but share-based remmuneration decreased in a bigger amount. The overall compensation (6.25 M€) decreased, as it has been the case for the last 3 years.

Boeing CEO, Dennis Muilenburg’s 2016 compensation (proxy statement here, PDF, 4.2 MB, page 30):

Muilenburg_2016

Boeing’s CEO Dennis Muilenburg 2016 compensation.

Dennis Muilenburg saw its base salary increased in 50 k$, after a decrease of 330 k$ last year in the transition between McNerney and him. Incentive percentages were kept constant, has been the case in the last 4 years. The total compensation (15.18 M$) increased in relation to 2015 but it is still bellow the 2014 levels (17.8 M$).

Comparison. It is interesting to note that while the base salary is nearly the same, 1.5 m€ vs 1.65 m$ (more so taking into account average exchange rates in 2016 (~ 0.90 EUR/USD)), the incentive schemes at Boeing end up with a total remuneration for the CEO about the double (x2.2) of that in Airbus.


(1) See the previous comparisons for the years 2013, 2014 and 2015.

(2) From what I see in the stats of the visits to this blog, other people are having similar conversations as these posts with the compensation comparison have ranked among the top 10 most read ones the last years.

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Boeing vs. Airbus: CEO compensation (2015)

Last year, I wrote a couple of post titled “Boeing vs. Airbus: CEO compensation (2014)” (and 2013) in which I compared the compensation of both CEOs. Yesterday, I saw that those posts received a larger than usual amount of visits which reminded me that now, at the end of the year 2016, we can find the same information for the 2015 fiscal year. Thus, this follow on post.

As both Boeing and Airbus are public companies, the information about their CEOs compensation is public and can be found in the annual report and proxy statement from each one. I will just copy the information below for comparison and future reference.

Airbus Group CEO, Tom Enders’ 2015 compensation (financial statements here, PDF, 1.7 MB, page 58).

Airbus Group’s Tom Enders 2015 compensation.

Airbus Group’s Tom Enders 2015 compensation.

In the case of Boeing, 2015 was particular in the sense that Jim McNerney was the CEO for the first half of the year and since July 1st the position is held by Dennis A. Muilenburg. Find in the table below the figures for both (proxy statement here, PDF, 3.7 MB, page 30):

Boeing’s Jim McNerney and Dennis Muilenburg 2015 compensation.

Boeing’s Jim McNerney and Dennis Muilenburg 2015 compensation.

It is interesting to note that while the base salary is nearly the same (1.4 m€ vs 1.6 m$, which after taking into account current exchange rate is almost equivalent) the incentive schemes at Boeing end up with a total remuneration about the double of that in Airbus Group.

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Boeing vs. Airbus: CEO compensation (2014)

At the beginning of this year, I wrote a post titled “Boeing vs. Airbus: CEO compensation (2013)” in which I compared the compensation of both CEOs. Even if the post was published in 2015, as I wrote it at the beginning of the year the latest information available from both companies was the compensation of 2013.

A few days ago, I saw that this post received a larger than usual amount of visits which reminded me that now, at the end of the year 2015, we can find the same information for the 2014 fiscal year. Thus, this follow on post.

As both Boeing and Airbus are public companies, the information about their CEOs compensation is public and can be found in the annual report and proxy statement from each one. I will just copy the information below for comparison and future reference.

Airbus Group CEO, Tom Enders’ 2014 compensation (financial statements here, PDF, 4.2 MB).

Airbus Group’s Tom Enders 2014 compensation.

Airbus Group’s Tom Enders 2014 compensation.

Boeing CEO, Jim McNerney’s 2014 compensation (proxy statement here, PDF, 1.0MB)

Boeing’s Jim McNerney 2014 compensation.

Boeing’s Jim McNerney 2014 compensation.

Just as a reminder, from July 1st 2015, Dennis Muilenburg took over the position of Chief Executive Officer (he was at that moment the COO) from Jim McNerney.

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Budget uncertainty in the Congress has kept the Boeing C-17 line open for years

Few days ago, I read in the weekly Aviation Week the following article, Boeing Blames Budget Uncertainty For C-17 Line Closure Timing, where Dennis Muilenburg, president of Boeing Defense, Space and Security, is quoted saying:

“… you quickly come to the conclusion that we cannot continue to spend money to keep that line open, given all of the other budget constraints. So, the fact that we are facing sequestration and uncertainty in the budget drove the timing of our decision.”

If anything, I would say the contrary: budget uncertainty in the Congress is what has kept the Boeing C-17 line open for the last years (coupled with international sales).

To understand that, it is important to remember that the C-17 program initially called for the acquisition of 120 aircraft. This number was later increased to 180 aircraft, and that the US Air Force had been requesting in its yearly budget requests zero aircraft per year since long ago. Only maneuvers in the Congress had been including in the final Defense Budget more C-17 units until the final 223 which were delivered (the last one in September 2013).

You can see an explanation of the plays that have taken place for years in the Congress in this article from 2009 in Business Week (“It’s a Bird, It’s a Plane, It’s Pork!“):

The C-17 Globemaster offers one illustration of successful opposition to the Obama-Gates push for control of weapons spending. C-17s are large cargo planes produced by Boeing that cost $250 million apiece. They have been used heavily since 1993 to transport troops, tanks, and supplies. Every year since 2006, the Pentagon has said that it has enough C-17s. And every year, Congress overrules the military and authorizes funds for additional planes. In October the Senate approved $2.5 billion in the 2010 budget for 10 more C-17s, which would bring the fleet to 215.

[…]

But the real reason Congress wants more of them has little to do with military need. Boeing has built the C-17’s industrial base for political survivability.

The company has spread manufacturing across no fewer than 43 states. C-17 production lines employ more than 30,000 workers, many of them relatively well paid by factory-wage standards. Many of those jobs would be at risk if C-17 work ground to a halt.

The White House understands the challenge. “The impulse in Washington is to protect jobs back home, building things we don’t need at a cost we can’t afford,” President Obama said in August in a speech at the Veterans of Foreign Wars Convention in Phoenix. “The special interests, contractors, and entrenched lobbyists—they’re invested in the status quo, and they’re putting up a fight.”

[…]

Bond, Senator Barbara Boxer (D-Calif.), and 16 colleagues began circulating a letter in April urging members of the Senate Appropriations Committee to keep funding the plane despite clearly stated objections from the White House and Pentagon. In California, C-17 production employs 5,000 workers at a final assembly plant in Long Beach.

[…]

These plays by politicians to try to keep the line open despite of the military not needing more aircraft continue to exist, as a few days ago we could read about a new plan: C-17 swap, to exchange older C-17s for new ones! (while the “old” ones have only about 20 years today possibly not having logged more  flight hours than two-thirds of their life).

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