Is Daimler-Benz AG Chief Executive Jurgen Schrempp in for a big pay raise?
He now makes about $2 million a year, a paltry sum compared with the approximately $70 million in salary and stock expected to be earned this year by Robert Eaton, chairman and chief executive of Chrysler Corp., with which Daimler-Benz is merging.
Published reports in Germany quoted Mr. Eaton as saying Mr. Schrempp's annual compensation might be boosted to the same level as Mr. Eaton's after the two firms complete their merger.
But Megan Giles, a Chrysler spokeswoman, gave a different spin to the report. "He said we have to pay competitively to keep good people, but in no way did he say Mr. Schrempp's salary should be equal to his," she said. "He also said that pay has to be tied to corporate performance. That's a rock tenet of his philosophy," she added -- that means getting a large portion of compensation in company stock and stock options, which reflect the performance of the company.
However, Karl Feuerstein, the head of Daimler-Benz's workers' council and deputy chairman of the supervisory board, said in an interview with a German newspaper that he will do everything possible to keep the new company from becoming too American. He said the way stock options are used in the US won't work in Germany unless there is a unique situation.
The goal of Messrs. Eaton and Schrempp "is to create a company that will no longer be a German company or an American company, but a marriage of two different cultures," said Ms. Giles.
