Christopher May
AMERICAN AXLE & MANUFACTURING HOLDINGSAbout Christopher May
Christopher J. May is Executive Vice President & Chief Financial Officer of American Axle & Manufacturing (AAM) since January 1, 2023, after serving as CFO since August 2015; he joined AAM in 1994 and is a certified public accountant with prior experience at Ernst & Young . At appointment he was age 53, underscoring >30 years of finance and operational tenure across internal audit, treasury, divisional finance and corporate control . Company performance under his finance leadership includes 2023 sales of $6.1B, adjusted EBITDA of $693M (11.4% margin), and operating cash flow of $396M, alongside $140M senior debt reduction . Over 2020–2023, cumulative TSR ranged from 77.51 to 86.71, finishing at 81.88, while adjusted free cash flow (a key incentive metric) posted $246.4M in 2023, $313.0M in 2022, and $422.9M in 2021 .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| AAM | EVP & CFO | 2023–present | Led shareholder outreach, refreshed incentive design emphasizing cash flow and performance-based LTI . |
| AAM | CFO (Vice President, then EVP) | 2015–2022 | Strengthened balance sheet with debt reduction, drove cash flow discipline and ESG-linked incentives . |
| AAM | Treasurer; Assistant Treasurer | 2011–2015 | Optimized capital structure; liquidity management through credit facilities and notes . |
| AAM | Director of Internal Audit | 2005–2008 | Strengthened internal controls and compliance . |
| AAM | Divisional/Plant Finance & Corporate Reporting | 1998–2005 | Advanced cost management and divisional performance analytics . |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Ernst & Young | Senior Accountant | Pre-1994 | Foundation in audit/accounting standards; CPA credential . |
Fixed Compensation
| Metric | 2021 | 2022 | 2023 |
|---|---|---|---|
| Base Salary ($) | 550,000 | 615,000 | 675,000 |
| Target Annual Incentive (% of base) | — | 80% | 100% |
| Non-Equity Incentive Paid ($) | 1,148,263 | 1,456,500 | 1,474,875 (incl. LTI cash unit earned) |
| All Other Compensation ($) | 331,696 | 357,809 | 316,213 |
Performance Compensation
Annual Incentive (2023)
| Metric | Weighting | Threshold | Target | Maximum | 2023 Actual | % of Target Earned | Payout Contribution |
|---|---|---|---|---|---|---|---|
| EBITDA Margin | 40% | 10.0% | 12.0% | 13.75% | 11.66% (adjusted) | 83% | 33% |
| Operational Cash Flow | 40% | $400M | $525M | $625M | $527M (adjusted) | 102% | 41% |
| Strategic Objectives | 10% | — | — | — | Achieved (e-axle awards, debt reduction, launches) | 200% | 20% |
| ESG/Sustainability | 10% | — | — | — | Achieved (DEI progress, renewable energy, supplier diversity) | 200% | 20% |
| Total | 100% | — | — | — | — | — | 114% of target |
Note: Committee adjusted for UAW Work Stoppage impacts deemed non-controllable in EBITDA and cash flow calculations .
Long-Term Incentive Design (2023 Grants)
| Component | Mix | Performance Measure | Targets | TSR Modifier | Vesting |
|---|---|---|---|---|---|
| Performance Shares | 30% of LTI | Free Cash Flow (annual ’23–’25 and 3-yr cumulative) | Annual: $200M/$250M/$300M; 3-yr: $600M/$750M/$900M; 50/100/200% payout | ±15% based on 3-yr percentile (<25th/25–74th/≥75th) | Cliff after 3 years |
| Performance Units (Cash) | 30% of LTI | Same as above | Same thresholds/targets | ±15% | Earned at period end; pro-rata on certain terminations |
| RSUs | 40% of LTI | Continued service | — | — | Cliff after 3 years |
2021 performance awards paid at 171% total (nearly $1B adjusted FCF 3-year cumulative), TSR modifier neutral (25th–74th percentile) .
Equity Ownership & Alignment
| Ownership Element | Detail |
|---|---|
| Beneficial Ownership | 337,824 shares; <1% of outstanding (117,539,721 shares at 3/7/2024) . |
| Stock Ownership Requirement | CFO must hold 3× base salary; only direct shares and unvested RSUs count; unvested performance shares excluded from counting since Feb 2023 . |
| Compliance Status | NEOs met or are on track to meet requirements as of 12/31/2023 . |
| Outstanding Equity (12/31/2023) | RSUs unvested: 79,557 (2021 grant); 83,019 (2022); 76,705 (2023); performance shares unearned: 83,020 (2022 at max); 57,529 (2023 at target) . |
| Anti-Hedging/Pledging | Hedging or pledging of AAM stock prohibited (policy applies broadly; directors and executives subject to governance practices) . |
| Stock Vested (realization) | Shares acquired on vesting: 192,682 in 2022 ($1,510,828); 125,634 in 2024 ($815,186) . |
Employment Terms
| Provision | Severance Plan (No CIC) | Change-in-Control Plan (Double Trigger) |
|---|---|---|
| Cash Severance | 1.5× base salary plus 1.5× target annual bonus; prorated target bonus for year of termination . | |
| Health Benefits | 1.5 years continuation . | 2 years continuation (or cash equivalent) . |
| Outplacement | Up to $20,000 . | Up to $30,000 . |
| Equity Treatment | 2023 performance units pro-rata at target for disability/retirement/without cause; full vest on termination within 2 years post-CIC . | |
| Non-Compete | 1 year post-termination; prohibits competition, solicitation, and misuse of confidential information . | |
| Illustrative 12/31/2023 Values | Without cause: Severance $1,012,500; AIP $1,782,000; RSUs $2,108,066; Perf shares ’22 $243,802; Perf units ’22 $256,650; Perf shares ’23 $168,943; Perf units ’23 $168,750; Health $33,854; Outplacement $20,000; Total $3,686,499 . | |
| CIC Scenario (12/31/2023) | Severance $1,350,000; AIP $2,119,500; RSUs $2,108,066; Perf shares ’22 $365,703; Perf units ’22 $384,975; Perf shares ’23 $506,830; Perf units ’23 $506,250; Health $45,139; Outplacement $30,000; Total $7,416,463 . |
No excise tax gross-ups; payments reduced if reduction yields better after-tax result (280G) .
Performance & Track Record
| Metric | 2020 | 2021 | 2022 | 2023 |
|---|---|---|---|---|
| Cumulative TSR | 77.51 | 86.71 | 72.68 | 81.88 |
| Adjusted Free Cash Flow ($M) | 311.4 | 422.9 | 313.0 | 246.4 |
| Sales ($B) | — | 5.1566 | — | 6.1 |
| Adjusted EBITDA ($M) | — | — | — | 693 |
2023 operating highlights included major electrification awards (Stellantis e-Beam), new global wins, and debt reduction, while navigating UAW Work Stoppage impacts; annual incentive payouts reflected adjusted performance and strategic/ESG achievements .
Compensation Structure Analysis
- Greater emphasis on at-risk pay: Performance-based LTI increased to 60% in 2023; annual incentive financial component remained 80%, with explicit cash flow weighting to align with deleveraging strategy .
- Alignment levers: Free cash flow as sole LTI metric with TSR ±15% modifier; stock ownership requirements restrict sales if not in compliance; clawback policies adopted per Dodd-Frank and discretionary recovery for misconduct .
- Governance responses to shareholder feedback: Increased performance weighting and cash flow emphasis; unvested performance shares excluded from ownership guideline counting .
- Risk mitigants: Anti-hedging/pledging, double-trigger CIC, no tax gross-ups, committee-led risk assessment of comp programs .
Compensation Peer Group (Market Benchmarking)
Peer set includes Adient, Aptiv, BorgWarner, Cooper-Standard, Dana, Flowserve, Garrett Motion, Goodyear, LCI Industries, Lear, Oshkosh, Parker-Hannifin, Rockwell Automation, Terex, Timken, Trinity Industries, Visteon; AAM revenues slightly below peer median .
Say-on-Pay & Shareholder Feedback
Say-on-pay support decreased to 77% in 2023 from 92–97% in 2018–2022; management increased performance-based LTI weight and annual cash flow weighting in response, while maintaining ESG/strategic metrics .
Equity Ownership & Vesting Schedules
| Equity Type | Grant Date | Vesting | 12/31/2023 Status |
|---|---|---|---|
| RSUs | Mar 1, 2021 | Cliff at 3 years | 79,557 unvested; vested Mar 2024 . |
| RSUs | Feb 28, 2022 | Cliff at 3 years | 83,019 unvested . |
| RSUs | Feb 28, 2023 | Cliff at 3 years | 76,705 unvested . |
| Performance Shares | Feb 28, 2022 | 3-yr perf (’22–’24) | 83,020 shown at max based on interim performance; final at period end . |
| Performance Shares | Feb 28, 2023 | 3-yr perf (’23–’25) | 57,529 shown at target interim . |
Stock vested events: 192,682 shares vested in March 2022; 125,634 in March 2024, reflecting realized value variability with share price . Anti-hedging and pledging policies reduce misalignment risk .
Investment Implications
- Pay-for-performance alignment is strengthening: heavier weighting to performance-based LTI and explicit cash flow KPIs align with deleveraging and liquidity preservation; TSR modifier adds external performance calibration .
- Retention risk appears moderate: Severance (1.5×) and CIC (2×) economics for CFO are competitive but not excessive; double-trigger equity and health benefits support stability without shareholder-unfriendly gross-ups .
- Insider selling pressure likely tied to scheduled vesting rather than discretionary sales given ownership guidelines and prohibitions on hedging/pledging; compliance monitoring reduces misalignment .
- Governance watchpoints: Committee’s use of adjustments (e.g., UAW strike) to annual metrics warrants monitoring; say-on-pay softness in 2023 suggests continued shareholder scrutiny of cash vs equity mix and performance rigor .
- Execution track record: 2023 achievements in electrification awards and consistent operating cash flow, alongside debt reduction, suggest focus on value creation under May’s finance leadership, albeit with margin/cycle headwinds reflected in TSR variability .