Private Jet Use by CEOs Skyrockets

As hordes of Americans watched their retirement savings disappear and their home values plunge after the economic crisis started in September, many corporate CEOs rode high, literally.

Fortune 100 CEOs used private aircraft more in 2008 than in any of the previous five years, according to a new study by Equilar, a firm that tracks executive compensation.

"Equilar's most recent research suggests a reluctance on the part of companies to eliminate or reduce aircraft perks," the report said.

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So how much do these fancy jets cost each company? In 2008, the median value of CEO travel for the year was $141,477, up from $109,743 a year earlier. Equilar notes that high fuel prices might have contributed to part of that increase.

But apparently, more CEOs took advantage of the jets last year. Equilar said 79.2 percent of those Fortune 100 CEOs got jet benefits last year, up from to 74.7 percent in 2007. Some companies have since announced plans to cut back on jet use.

Some CEOs used their jets more than others. According to Equilar's review of Securities and Exchange Filings, the top 10 users, according to 2008 value of jet expenses, were:

GMAC CEO Alvaro G. de Molina: $2,259,595

IBM President and CEO Samuel J. Palmisano: $493,881

Tyson Foods President and CEO Richard L. Bond: $458,069

American Express Chairman and CEO Kenneth I. Chenault: $414,702

Deere & Co. President and CEO Robert W. Lane: $401,732

Comcast Chairman, President and CEO Brian L. Roberts: $392,732

News Corp. Chairman and CEO Rupert K. Murdoch: $378,923

Morgan Stanley Chairman and CEO John J. Mack: $377,342

Safeway Chairman, President and CEO Steven A. Burd: $374,520

Ford President and CEO Alan R. Mulally: $344,109

These big companies often argue that it is necessary to fly executives and their families around on private jets. This is not a lavish perk, they say, but a safety and security requirement as well as a time-saving tool for the busy leaders.

Companies Change CEO Jet Travel Policies

As the economic crisis has grown worse, some companies changed their policies.

GMAC, whose CEO travel expense was more than four times higher than the next closest company, said that once it took government TARP dollars "all personal and business travel on company aircraft ceased." Before that, the company had leased usage on GM's corporate aircraft, a spokeswoman said.

MetLife also changed its policy, saying at the end of March that "the company's policy that previously required the chief executive officer to use the Company's aircraft for all travel, personal as well as business, was revised. The company's policy no longer requires the chief executive officer to use the company's aircraft for all personal and business travel."

Pepsi and Sears made similar cutbacks in corporate jet use and reimbursement by their CEOs.

But the efforts to trim travel expenses have been a bit murky for several big companies, the auto companies in particular.

An April 3 filing with the SEC revealed that in December 2008 Ford ended its own in-house private jet facilities as part of a process to sell its corporate jets. However, company policy still doesn't allow CEO Mulally to fly with the rest of us on commercial airlines, "due to security concerns." So instead, Ford charters a private jet for his use.

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