Incoming Alcoa CEO got $9.7M in 2008 compensation

PITTSBURGH (AP) -- Alcoa Inc.'s chief executive, Klaus Kleinfeld, received compensation valued at $9.7 million in 2008, when he succeeded Alain Belda as the aluminum maker's top executive, according to an Associated Press calculation of figures disclosed in a regulatory filing Monday. But some of the compensation came in stock that has deteriorated in value. Belda, who remains Alcoa's board chairman, received compensation valued at $13.8 million last year, down from $25.6 million in 2007, his last full year as chief executive. Kleinfeld, previously the company's chief operating officer and a board member, became CEO in May 2008. The global economic downturn dealt Pittsburgh-based Alcoa a severe blow late last year, as orders shrank for the lightweight metal used in cars, aircraft, window frames and myriad other products. Prices tumbled faster than ever before due to the drop-off in demand from key markets such as the auto and construction industries. In response to the market turmoil, Alcoa announced in January it would lay off about 13 percent of its global work force by the end of 2009, further cut production and spending, and sell four of its subsidiaries. Kleinfeld, 51, also the company's president, received a base salary of $1.4 million in 2008, according to a proxy statement filed with the Security and Exchange Commission. He also received a performance-related bonus totaling $1.9 million. More than half of Kleinfeld's compensation came in stock valued by Alcoa at $5.59 million when it was granted in January and March last year. But the shares, which had traded at $28.79 and $38.47, respectively, when granted, have since shed much of their value. Alcoa stock closed Friday at $5.73 per share. Included in Kleinfeld's pay package was $428,305 for his relocation to New York, where Alcoa has executive offices, and $188,245 in reimbursement for income tax incurred by the move. The chief executive also received $58,254 for personal use of company aircraft and $59,200 for personal use of a company car and driver, among other perks. The Associated Press' compensation formula is designed to isolate the value the company's board placed on the executive's total compensation package during the last fiscal year. It includes salary, bonus, performance-related bonuses, perks, above-market returns on deferred compensation and the estimated value of stock options and awards granted during the year. The calculations don't include changes in the present value of pension benefits, and they sometimes differ from the totals companies list in the summary compensation table of proxy statements filed with the Securities and Exchange Commission, which reflect the size of the accounting charge taken for the executive's compensation in the previous fiscal year. For 2008, Alcoa lost $74 million, a substantial decline from its profit of $2.56 billion for the previous year. During the year, Alcoa shares fell nearly 70 percent in value.