Aug. 19--The survey, to be published in full this month, concludes that salary levels for CEOs of 70 publicly traded automotive companies and 350 executives in the United States increased 4% in 2007, down from a 5% increase in 2007.

But Michael Horne, executive compensation consultant for Watson Wyatt, said this year's survey revealed one clear and somewhat surprising trend: Automotive companies are boosting compensation for top executives who are not CEOs.

"We noticed a substantial increase in the top four non-CEO officers in the payments and opportunities compared to the CEOs," Horne said. "Organizations are really focusing in on the key talent," Horne said.

Horne cautioned that it is somewhat difficult to compare some of this year's results to last year's survey because the group of companies isn't exactly the same.

That said, the median total direct compensation of CEOs at companies surveyed dropped from $2.8 million in 2006 to $2.7 million in 2007 and the median salary of the next four highest-paid executives increased from $928,000 in 2006 to $975,000 in 2007, Horne added.

Watson Wyatt also found that 24% of automotive CEOs did not receive a bonus last year.

There were, however, some exceptions.

In its proxy statement filed with the SEC in March, American Axle & Manufacturing postponed bonuses to its executives, pending the outcome of negotiations with the UAW.

Then in June, American Axle disclosed that CEO Dick Dauch was paid an $8.5-million bonus -- more than double his 2006 bonus -- as a reward for securing a concessionary contract with the UAW.

Watson Wyatt also said fewer companies are using stock options and are instead rewarding executives with compensation tied directly to the financial performance of the companies.

Horne said there are two main factors behind the survey trends: New federal disclosure regulations and the auto industry's difficulty retaining talent.

In 2006, the U.S. Securities and Exchange Commission adopted new disclosure requirements surrounding executive compensation for publicly traded companies.

In many cases, those changes require companies to disclose more information than before and require the information to be presented more clearly than before.

"The reason why I believe you are seeing these results is that the story has to be told," Horne said.

Horne said the reason compensation is increasing for many high-ranking executives who are not chief executive is that many automotive companies are fighting to retain talented executives as the industry goes through a challenging period.

High-profile departures from the automotive industry include David Wajsgras, Lear Corp.'s executive vice president, who joined Raytheon Corp. in 2006 and Anne Stevens, a former Ford Motor Co. executive vice president who joined Carpenter Technology Corp. in 2006.

On the other hand, Alan Mulally joined Ford as CEO in 2006 from Boeing Co. and Bob Nardelli joined Chrysler LLC as CEO last year, having run Home Depot Inc.

"It's a retention and motivation issue," Horne said. "They've lost a lot of talent to other industries."

Contact BRENT SNAVELY at 313-222-6512 or bsnavely@freepress.com.

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