Dave Neelman of JetBlue made $118 million in 2007

[On Your Six]

Hey JetBlue pilots,

Maybe it's time for you to make some more money considering your boss made $118 million off your blood, sweat and tears in 2007 alone.

Sure, he's the company founder, but that's a bit extreme considering the lackluster performance of the stock and the company over the past year. Selling so much stock certainly ain't a big vote of confidence in the future - right? I think he sold another big chunk of stock a few days ago. Do I hear a future union calling??????

Check out the top golden parachutes for 2007 (and Neelman's bounty) on the link below:

http://www.cnbc.com/id/22420231

Discuss...http://www.cnbc.com/id/22420231

 

[SNOWBUM]

So Neeleman's "golden" parachute was $858,000.
By comparison is not a lot.
the money he made was by selling stock was he was granted when he funded the airline. That is the reason people start business, to make money.

He was not granted million of stock options while he was running the show. Big difference between him and tilton or arpey. he got the stock as funder shares before IPO.

that being said, www.jetbuepilots.org

is the place to go and sign up . JBPA is a real pilot union seeking the representation of the JetBue pilot group.
Jan 14 ids the open meeting to vote on constitution-by laws,policy manual,elect interim officers and start the marketing campaign.

 

[johnsonrod]

So Neeleman's "golden" parachute was $858,000.
By comparison is not a lot.
the money he made was by selling stock was he was granted when he funded the airline. That is the reason people start business, to make money.

He was not granted million of stock options while he was running the show. Big difference between him and tilton or arpey. he got the stock as funder shares before IPO.

that being said, www.jetbuepilots.org

is the place to go and sign up . JBPA is a real pilot union seeking the representation of the JetBue pilot group.
Jan 14 ids the open meeting to vote on constitution-by laws,policy manual,elect interim officers and start the marketing campaign.

Please re-read the article. The fact that Neelman made $850K in salary is immaterial. He wouldn't have been included in this article if that was all he made - CNBC was referring to his stock gains (look at the chart in the article)...

The more troubling fact is that Neelman has been selling stock left and right recently. In fact, he sold something like 1/3 of his remaining shares just in the last few days. I agree with OYS - not a big vote of confidence in the future....

 

[Sedona16]

Neeleman isnt the same as the corporate raiders that come into an existing company, screw it all up then eject with millions in their hands. Neeleman was the brainchild behind JB and probable deserves at least some of this stock money. Not saying I am in agreement with what JB is or how it has hurt the industry. I think Neeleman is still smarting from being pushed out at CEO (ask Steve Jobs how much he liked something similar). Hes ready to take alot of his marbles and go home. I have no doubt he can go do something else innovative and make even more money. I doubt this is as fun as it once was for him before the ice storm and being pushed out making him feel stupid. If I were him I would go north to Canada and take back control of Westjet and work my way down.

JetBlue founder: Storm cost CEO job

Neeleman admits to being upset with being forced out of CEO spot following service problems that followed February ice storm.

By Chris Isidore, CNNMoney.com senior writer
June 26 2007: 2:44 PM EDT


NEW YORK (CNNMoney.com) -- JetBlue Airways founder and Chairman David Neeleman admitted Tuesday that he wasn't pleased when his company's board forced him to give up the CEO spot in May, and said he believes he'd still have the job if not for the ice storm and service meltdown that hit the airline in February.
"Obviously, when you found a company, and you're the visionary and you start it from Day 1, no one really wants to give up the reins," he told CNNMoney.com following an appearance at the Fortune Leadership Forum. Fortune magazine is a partner in the CNNMoney.com Web site.
http://i.cnn.net/money/2007/06/26/ne...jetblue.03.jpgJetBlue founder David Neeleman said he's comfortable in his new role as non-executive chairman, but said his loss of the CEO job was abrupt and traumatic for the company.
Videohttp://i.cnn.net/money/.element/img/...plus_green.gifMore video
http://i.a.cnn.net/cnn/video/busines...uest.story.jpgCNN's Richard Quest gets rare access to Continental Airlines' nerve center to see how daily operations are managed. (April 13)Play video

http://i.a.cnn.net/cnn/video/busines...tune.story.jpgCNN's Richard Lui describes the airline industry's turnaround since 2001 in this Fortune First feature. (May 7)Play video




JetBlue (Charts) never disguised the fact that Neeleman was asked to give up his CEO spot, although both the company and Neeleman tried to make it seem as far more a mutual decision the day it was announced.
"When you're a founder and an entrepreneur and you get mired in the operation, it's not good for anybody," he told Reuters news agency that day. "This is a much better structure for us going forward. That was the board's recommendation, and I said 'Great, let's do it'."
In Tuesday's interview, he called the decision to remove him from the CEO job as "abrupt" and "a traumatic thing for a company." And he said that he believes the airline's well-publicized service problems related to the ice storm in February were what cost him the job he would like to still have.
"That's a difficult question to answer, but I think probably," he said. "It's tough to put Humpty Dumpty back on the wall and say what would have happened if it hadn't been broken."
Still, he also believes the board was interested in making a change sooner or later, and that the ice storm problems probably only accelerated what would have happened.
Neeleman insists he's now comfortable in his new role and with the management team now in place.
Dave Barger, who had been president of the upstart discount airline since its early days in 1998, long before its first flight, is the new CEO. Russell Chew, a former Federal Aviation Administration executive who Neeleman said he recruited in the aftermath of the February service problems, is the new chief operating officer.
"I'm there (at the company's offices) a lot. Our management team and our leadership want me to be," he said. "I'm the largest non-institutional shareholder. It's my great desire for the company to succeed."
Neeleman has trimmed his holdings in JetBlue since his departure, though. Filings with Securities and Exchange Commission show that he sold 2.5 million shares of the stock, or 23 percent of his holdings, on May 29, for $10.87 a share.
"It's something I should have done a long time ago," he said, saying too much of his net worth was tied up in the company's holdings, and that he had margin loans against those holdings that he was able to eliminate with the sale.
Neeleman said he's donated his salary since founding JetBlue to a fund to help employees who have serious financial setbacks such as illness or deaths in the family.
Shares of the company were slightly higher than his sales price in trading Tuesday, although they were well below the 52-week high of $17.02 hit early this year - before the ice storm.
Still, despite the decline in stock price, Neeleman said he never sensed that it was large shareholders putting pressure on the board to remove him. Over the last six months, JetBlue shares have trailed rivals Southwest Airlines (Charts, Fortune 500), American Airlines parent AMR (Charts, Fortune 500) and United Airlines parent UAL (Charts, Fortune 500), although it is roughly on par with Continental Airlines (Charts, Fortune 500) and ahead of US Airways Group (Charts, Fortune 500).
At a forum that was part of the Fortune conference at New York's Time Warner Center, Neeleman said one regret he had about the way he handled problems associated with the February ice storm had to do with not keeping the board more in the loop on the problems and the decision-making process.
"One problem with independent, outside directors is they are looking through knotholes at the company," he said. "They don't necessarily get a full dose of what's going on."
As far as his communication with the board, or lack there of, he told the forum one director told him, "'You were an extraordinary CEO, you were a lousy chairman of the board.' I guess I'll take any time."
JetBlue's operations problems became apparent after an ice storm on Feb. 14 that hit the airline's hub at John F. Kennedy International Airport in New York.
The carrier had numerous planes packed with passengers heading out on holiday vacations that were trapped on the tarmac at JFK for eight or more hours, some of them which were never able to leave.
It took the better part of a week for the airline to resume its normal operations. It also led Neeleman to apologize publicly for the problems. He also introduced a so-called "passenger's bill of rights," promising vouchers for future travel based on the length of a delay, along with the right to get off any aircraft that has been grounded for five or more hours.

 

[GuppyPuppy]

Neeleman thinks his departure was "traumatic" for the company???

Most of us were so glad that he left. I'm suprised we didn't throw a party! But seriously, I haven't talked with one JB employee who thinks his departure was a bad thing.

GP

 

[lowecur]

Neeleman thinks his departure was "traumatic" for the company???

Most of us were so glad that he left. I'm suprised we didn't throw a party! But seriously, I haven't talked with one JB employee who thinks his departure was a bad thing.

GP

He really had no idea how to run a maturing airline. He is a nice man and extremely honest, which is rare in the world of big business. His inability to focus on one thing at a time must have drove Barger nuts, as you lose the ability to prioritize the decision making process.

In the end, I believe Barger thoroughly respects and cares for Neeleman. However, Neeleman is a total control freak and I'm sure he is pursuing other ventures as we speak.

imp:​

 

[johnsonrod]

If history repeats, he will take some of this bounty and invest it in another aviation-related venture. I read that he was kicking around Maxjet's certificate at one point - that's just a rumor from another FI post.

Agreed that he is the founder and he deserves to cash out. Still, $118 million in 2007 alone is a lot of money while his employees work their arses off...

 

[MD80DRVR]

My guess is he will make billions with a capital "B" in the coal to oil field. He has the money and he has the vision..... Good for him.

 

[rayford steele]

If history repeats, he will take some of this bounty and invest it in another aviation-related venture. I read that he was kicking around Maxjet's certificate at one point - that's just a rumor from another FI post.

..

Read where? Oh yeah....you read it here on flightinfo....please!

 

[Old School 737]

He is very good at staring airlines, but running them is a whole different ballgame!

 

[Pocono Pilot]

He really had no idea how to run a maturing airline. He is a nice man and extremely honest, which is rare in the world of big business. His inability to focus on one thing at a time must have drove Barger nuts, as you lose the ability to prioritize the decision making process.

In the end, I believe Barger thoroughly respects and cares for Neeleman. However, Neeleman is a total control freak and I'm sure he is pursuing other ventures as we speak.

imp:​

Do you write in Blue just because you work for Jetblue? Is that kinda your 'thing?'

Maybeishouldwritereallyfastbecasusiworkforexpress. LOL

 

[lowecur]

If history repeats, he will take some of this bounty and invest it in another aviation-related venture. I read that he was kicking around Maxjet's certificate at one point - that's just a rumor from another FI post.

Agreed that he is the founder and he deserves to cash out. Still, $118 million in 2007 alone is a lot of money while his employees work their arses off...

I've heard he was worth upwards of $200M before Jetblue. I don't think it's about the money as much is it is about the challenge. I think he lives a modest life, comparatively speaking to other CEOs.

At this point in his life, an extra $118M is meaningless except to use to invest in another venture. I think he'll have to put in his own money next time, as investors saw how he squandered their money as the airline matured. He was the guy who sold his ideas to Soros & Co. and then made it happen. That's what business is all about, and he deserves whatever he makes. Don't forget, I think he turned over his salary to the less fortunate....a nice gesture.

imp: ​

 

[StaySeated]

I honestly don't see anything wrong with him making 118 million, or 200 million or 500 million. He started the airline, he was granted the shares, then he sold the shares. What is the big faking deal?

What is the difference between him taking the risk of starting the airline and basing a substantial amount of his comp on stock options and you or I doing some research and buying some shares of a company that does well?

Those of you that are shocked with a $118 million profit from the sale of stock are the same people that think $100k a year is alot of money.

 

[SNOWBUM]

If history repeats, he will take some of this bounty and invest it in another aviation-related venture. I read that he was kicking around Maxjet's certificate at one point - that's just a rumor from another FI post.

Agreed that he is the founder and he deserves to cash out. Still, $118 million in 2007 alone is a lot of money while his employees work their arses off...

remeber those share were founder shares. when you start an airline a biz with venture capital ( an doyur own) oyu get founder shares. he owned a nice chunk of the airline. those shares are expense the way options are, they were given to him before IPO and he did invest his million at JB.

he put his shares on auto sale when he got ousted.He should have sold most of it way before to diversify himself. His salary while JB CEO was 250k which he donated to the JCCC 9 employee mutual aid fund) and his bonuses and stock options never hit the million $ even when JB was growing ( yes he did have his founder shares so he could care less, still )

I'm not sad to see him go, but he did not taook 118 million form JB and run like tilton ,mullen, arpey or the other clowns do.

 

[climbhappy]

what's wrong with selling your stock? how does that relate to employees working their arse off? one has nothing to do with the other... if he had sold when it was at 60 in the beginning that would be one thing, but now?

 

[johnsonrod]

what's wrong with selling your stock? how does that relate to employees working their arse off? one has nothing to do with the other... if he had sold when it was at 60 in the beginning that would be one thing, but now?

Selling a huge chunk like this in one year (2007) sends a message... What happened to holding on to it for the long-term????

 

[TWA]

Yeah, it sends the message that he's pissed that he isn't the CEO anymore and now has better things to do with his time.

He started the company and should reap the rewards. Where do all these pilots get the idea that just because they fly for an airline they should be the only ones making money???

If you want to reap all of the rewards, start your own airline, take the risk yourself. Let me know how it turns out.

 

[climbhappy]

it almost always says (no matter the industry) that there is a lack of confidence in the company. but we can't rule out some big accouting reason or to hoard cash for some other opportunity.

 

[AKAAB]

it almost always says (no matter the industry) that there is a lack of confidence in the company. but we can't rule out some big accouting reason or to hoard cash for some other opportunity.

Bingo! David has his sights set on the gasification of coal and will probably make another mint. I hope he buys one of those new corporate Embraers! :laugh:

 

[whymeworry?]

What in the fk do these so-called genius' really do to earn that kind of coin?

1) The entire economy is facing a meltdown of epic proportions in 2008 due to the action of guys like the Merrill Lynch CEO (he threw the firm headlong into Mortgage-back securities, the cause of the credit market decimation).

2) Bob Nardelli virtually wrecked Home Depot. The employees left for Lowes as did the customers (under his reign he believed in paycuts for employees, they voted with their feet, we as customers suffered).

3) Dave Neeleman couldn't manage an airline in a snowstorm crisis... an airline that is based where snow storms regularly occur. (he couldn't manage the bottomline due to runaway fuel prices either... READ: as fuel goes up, RAISE YOU'RE PRICES).

I just don't see what these guys do that makes them so worth the money. The BODs of these companies should do time for this kind of robbery. It puts the nation's future at risk.

I have no problem with competitively compensating executives. But golden parachutes like this prove there is no accountability on Wall Street. It's no wonder London is kicking America out of the top spot in the financial world.

 

[Bavarian Chef]

What a bogus thread this is. While DN may have proved the "Peter Principle" in the sense that his airline grew to a level above his compentency (okay, a slight perversion of the PP, but think about it and it fits), he cannot be compared to the typical airline exec. DN started JB from the ground up, put his own money up, worked for YEARS before and after 2000 to get it running and help make it successful. His departure was welcome, but in the end, his vision and efforts created an airline (and 10000 jobs). Most airline execs can't even create their own bowel movements without a stock distribution from the BOD.

He who risks, wins.

whymeworry -- a large part of the reason for our Valentine's Day Massacre is so simple you would probably get lost wrapping your mind around it:

Back then we never canceled flights. On that day we operated under the idea that if a person bought a ticket, then it is our job to get them there, no matter when. Since the reign of Russ "Big League" Chew, we cancel all the time. We canceled plenty over the last weekend, except on Christmas Eve, when it really counted not to screw it up. Did it make the news. No.

Look at United's Christmas though: cancel and you're fooked. Don't cancel and you're fooked. Stoopid bizness or stoopid passengers or stoopid media? I'll wager it's all three.

 

[mooney flier]

What in the fk do these so-called genius' really do to earn that kind of coin?

1) The entire economy is facing a meltdown of epic proportions in 2008 due to the action of guys like the Merrill Lynch CEO (he threw the firm headlong into Mortgage-back securities, the cause of the credit market decimation).

2) Bob Nardelli virtually wrecked Home Depot. The employees left for Lowes as did the customers (under his reign he believed in paycuts for employees, they voted with their feet, we as customers suffered).

3) Dave Neeleman couldn't manage an airline in a snowstorm crisis... an airline that is based where snow storms regularly occur. (he couldn't manage the bottomline due to runaway fuel prices either... READ: as fuel goes up, RAISE YOU'RE PRICES).

I just don't see what these guys do that makes them so worth the money. The BODs of these companies should do time for this kind of robbery. It puts the nation's future at risk.

I have no problem with competitively compensating executives. But golden parachutes like this prove there is no accountability on Wall Street. It's no wonder London is kicking America out of the top spot in the financial world.

Speaking of which, does anyone know how poor ole Leo Mullin is doing ?

 

[SNOWBUM]

again neeleman did not got 118 mill inshares form the BOD. he started the airline and he got founder shares becaus ehe invested his money and got other venture capitalist and hedge funds to pony up $$$ too. they all agreed to his founder shares BEFORE ipo.

IT DID NOT COST jb ANY . stock options cost money. founder shares are given to founders by the venture capitalist when the stock is issue just to the venture capitalist and it is not expense the way options are.

Is like you owning 20% of a sandwich shop which is publicly traded and then selling your part to someone else, it does not cost your employees or the stock holders any.
furthermore his shares are being sold on autopilot, he set up the sell program when he got ousted, he has to continue regardless of the info he might or might not have, those are programs the SEC set in place so executives with potentially privileged info can sell shares without the aid of insider info.

everyone is happy he left, but him making millions does not hurt JB or its employees at all.

 

[zonker]

Just remember, they can't pay you because they're still a "new" carrier.

But someday, Dave is going to take care of you. Just not today.

 

[zonker]

oh yeah.

lather, rinse, repeat

 

[AC560]

but that's a bit extreme considering the lackluster performance of the stoc

That lackluster stock performance cost him a lot of money.

 

[Bavarian Chef]

That lackluster stock performance cost him a lot of money.

Bingo! Think of how much money he could have made.

 

[Sedona16]

http://weblogs.newsday.com/business/blog/2007/12/jetblue_faces_challenges_in_fi.html

JetBlue faces challenges in first new year without founder Neeleman

For the first time in its eight-year history, JetBlue Airways Corp. will begin a new year without David Neeleman, who founded the airline in 1999, as its chief executive officer.

Neeleman was pushed upstairs, to the rank of non-executive chairman, soon after the worst episode in the airline's history. It was on Valentine's Day that thousands of JetBlue passengers were stranded -- some on planes sitting on runways for hours -- as an ice and snow storm gripped much of the East Coast.

While most airlines had trouble that day, JetBlue's problems were among the worst because the Forest Hills-based airline -- as had been its long-standing custom -- refused to cancel any flights.
Neeleman accepted blame, and was replaced as CEO by JetBlue's president, David Barger.
Now, it is Barger's show. He has, in the view of analysts, gotten off to a good start. He immediately shook up senior management, bringing in a veteran Federal Aviation Administration official, Russell Chew, to be JetBlue's chief operating officer. JetBlue has also voluntarily adopted a customer bill of rights, providing passengers delayed on planes for more than five hours to deplane.
Under Barger, Deutsche Lufthansa AG, the German airline, took a 19 percent stake in JetBlue, paying the airline $300 million, which adds liquidity to the discount
carrier. Lufthansa, which announced the stake earlier this month, has not yet said whether it has any plans for JetBlue's future.
But Barger faces many challenges in the year ahead. One is competition from Virgin America, the start-up launched by U.K. billionaire Richard Branson, which
announced recently more flights from California to Kennedy Airport, JetBlue's main hub.
Another is fuel prices, a problem all airlines face. JetBlue's stock has
also plummeted in the last year, causing a loss of more than half its market value. Investors will be looking for how Barger plans to raise the company's stock
price.
JetBlue has always wanted to grow, and grow fast. That was the Neeleman way. Neeleman added Embraer-built jets to the company's fleet of Airbus planes, and
as a result JetBlue's debt stands at about $2.7 billion, among the highest in the airline industry, While JetBlue has slowed its growth -- cutting back on the new
Embraer planes it will add to its fleet in 2008 -- it has still added 12 percent more capacity this year, while some of its rivals have been cutting back.
So Barger will have his work cut out for him. Not everyone is optimistic either. Veteran airline analyst Jamie Baker, in a recent report, said JetBlue may
be a takeover target, although he did not name any suitors. Baker predicted the airline will lose money in '08, and advised clients to sell.

--Jim Bernstein




Posted by Noel Rubinton on December 24, 2007 12:36 PM | Permalink