The average auto finance executive raked in $1.7 million in compensation last year, a number unchanged from 2019, according to an Auto Finance News analysis of Securities and Exchange Commission filings.
Ally Financial Chief Executive Jeffrey Brown outearned 29 other senior executives at publicly traded auto finance companies in 2020. Including base salary, bonus, stock options and other compensation, Brown earned $11.6 million, up 9% year over year.
The No. 2 earner last year was Vroom CEO Paul Hennessy, whose $3.8 million in stock options propelled his compensation to $4.3 million. By comparison, Hennessy earned $814,077 in 2019. Online used-car retailer Vroom went public in June 2020, raising $468 million. Through yearend, though, its stock price declined 12% to $43.80 per share.
Meanwhile, a trio of Ally executives — President of Auto Finance Douglas Timmerman, President of Consumer and Commercial Banking Products Diane Moraes and Chief Financial Officer Jennifer LaClair — rounded out the top five auto finance earners, each with more than $3 million in total compensation.
The lowest paid executive in 2020 was Patricia Moran, chief legal officer and secretary at Vroom. She earned $329,538.
When analyzing compensation strictly by base salary, Santander Consumer USA President and CEO Mahesh Aditya topped the list at $1.6 million. Ally’s Brown was the only other executive with a $1 million base salary, though Kenneth Booth, who took over this week for the retiring Brett Roberts at Credit Acceptance, will earn a $1-million salary in 2021 as the subprime lender’s newly minted president and CEO.
The highest percent change in base salary was 36%, recorded by Toby Russell, co-CEO at Shift. Russell’s base pay for 2020 was $339,100. Christopher Pfirrman, chief legal officer at Santander Consumer USA, posted the second-highest base salary increase, at 24%. Pfirrman earned $819,018 last year.
In 2020, the average base salary among auto finance executives was $534,643, up 5.8% year over year. For U.S. companies broadly, CEO pay fell 1.6% last year, according to Equilar, a provider of data on corporate leadership.
The higher base salaries for auto finance executives come on the heels of increased outstandings at some of the companies that employ them. For instance, total outstandings at Ally clocked in at $83.1 billion last year, up 2% from 2019. Santander’s outstandings climbed 4% to $48.9 billion, while Carvana’s skyrocketed 59% to $5.3 billion.
Despite the rise in Carvana’s book of business, which hinged on online vehicle sales and financing options and contactless delivery options, the company’s executive compensation largely held steady last year. Of the five executives named in the lender’s SEC filing, four recorded 1% increases in pay. The fifth executive, CEO Ernest Garcia III, reported a 13% decline to $767,000.
Nicholas Financial, Santander, Shift and Vroom also had executives with declines in year-over-year compensation. In fact, while Vroom’s Hennessy recorded the greatest jump in compensation from 2019 to 2020 — a whopping 430% — three other Vroom executives posted 70% declines in pay. The discrepancy stemmed from stock and option awards received by the trio in 2019, but not in 2020.
The highest valued stock options primarily went to Ally executives. Brown topped the leaderboard, at $6.9 million. Four of his colleagues recorded stock options in the $1.2 million-to-$1.9 million range. Throughout 2020, Ally’s stock price rose 19% to $34.94 per share.
Nine other executives received stock options ranging from $153,888 to $523,997.
Three HyreCar executives — CEO Joseph Furnari, CFO Scott Brogi and COO Henry Park — saw their total compensation more than double, primarily because of stock options. All three had options totaling $1,480 in 2019; those figures shot up to $237,563 for Brogi and Park and to $181,000 for Furnari. Throughout 2020, HyreCar’s stock price skyrocketed 167% to $7.23 per share.
For bonuses, Ally executives fared best. Brown earned the highest bonus of the bunch: $3.7 million. Another three Ally executives earned million-dollar bonuses, while General Counsel Scott Stengel earned an extra $676,800. On the flip side, the lowest bonus amount was $12,500 paid to Irina Nashtatik, Nicholas Financial’s CFO. Carvana and Vroom didn’t pay out bonuses at all to senior executives last year.
In all, 18 of the 30 executives received bonuses. The average bonus hovered around $825,000, up nearly 30% year over year.
It remains to be seen how senior executive compensation will fare in 2021, but chances are high that base salaries and bonuses will rise as vehicle financing volume rebounds.
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