The Indians today signed their inexperienced catcher Yan Gomez to a six-year $23 million contract extension that contains two additional option years for the Tribe. Gomez has just a little over a year’s major league service time, so the risk to the Indians is that Gomez isn’t really as good as he performed in 2013. However, after a very strong year in AAA in 2012, Gomez is probably good enough for this to be a great deal for the Indians if Gomez stays healthy.
Since the Royals locked up catcher Salvador Perez long-term in 2012, it has become the rage for teams to try to extend their most promising pre-arbitration eligible players with long-term deals, particularly ones that buy out one or more free agent seasons. Mike Trout‘s record-setting deal of a few days ago immediately pops into mind, as does the Jose Altuve‘s mid-2013 extension. (There are others, of course, but they are not immediately coming to mind.)
These deals obviously bear some risk for the teams making them, but the risks are largely superseded by the tremendous savings teams receive if the young player develops as hoped for and expected. Young players have made it clear that they will leave money on the table (including even Trout’s nine-figure mega-deal) in exchange for a guarantee that no matter what the future brings they will make at least a small fortune playing professional baseball.
I would think this guarantee would be particularly appealing for foreign players coming from impoverished countries, although of the players mentioned above, Trout was born in the U.S. and Gomez is probably a U.S. citizen since he attended high school in Miami. In short, it looks like this guarantee is appealing to many, many young players. One would also think that the strategy is particularly appealing to small-market teams who want cost certainly, although the Angels (Mike Trout) are hardly a small-market team.
I don’t see this new trend diminishing except in the event that a number of these contracts blow up in their teams’ faces all at the same time. Even then, the strategy looks like one that will save teams money in a majority of cases over time, more money than will be lost on the few contracts where players fail spectacularly after signing.
None of the young players mentioned above needs to get better than they were immediately before signing their extensions for the deals to be good for their clubs; they only need to maintain this value for their teams to come out ahead. Of course, a majority of these players will, in fact, get better as they move into their age 26-28 year old seasons.