The Time for Long-Term Extensions
Jose Altuve is off to a tremendous start this year, even if the Astros are not, and it’s got me thinking about the almost embarrassingly team friendly long-term contract he signed with the ‘Stros a few years ago.
As everyone knows, the Astros have been at the forefront in trying to lock up their young stars with long-term team-friendly deals. There was far more screaming from other players and the players’ association when the team signed Jon Singleton to a five-year $10 million deal even before Singleton had played a day in the majors, in order to lock in Singleton to three more seasons at relatively reasonable team options, than there was about Altuve’s contract.
If you will recall, people complained that the deal was “black mail” because the Astros had kept George Springer in the minors just long enough to ensure that the team would get an extra year of control after Springer refused to sign a team-friendly long-term deal the previous September. Also, people complained that Singleton should have “bet on himself” and his baseball future, rather than sign this deal.
Well, as it has turned out, the deal Singleton signed looks like its going to be better for him than for the team. He hasn’t established himself as a major league player and isn’t playing particularly well so far at AAA in 2016, the third year of the deal.
In fact, the whole purpose of this deal was give Singleton an upfront guarantee in order to lock in one or two free agent seasons at a bargain price. However, even if the Astros exercise all three options, Singleton won’t become a free agent until the contract is over and done with.
Don’t feel too sorry for the Astros, though. The $10 million committed to Singleton isn’t a particularly big hit in light of current team salary amounts, even if Singleton never plays another game in the majors.
In fact, even if Altuve gets hit by a bus tomorrow, the Astros may already have saved $10M simply by virtue of the fact that Altuve couldn’t take advantage of salary arbitration after his terrific 2014 and 2015 seasons. If Altuve stays healthy, the deal only gets better as the Astros won’t be paying him more than $6.5 million per year through the 2019 season.
(Don’t feel too sorry for George Springer, either. He’s healthy, playing well, and the Astros called him up early enough in 2014 to ensure that he will be a super-two and eligible for salary arbitration after this season. I very much doubt that Springer will be giving the Astros any discounts anytime soon.)
The reasons why the Altuve deal worked out better for the team than the Singleton deal seem fairly obvious. Altuve had almost two full years of major league service at the time he signed his extension, while Singleton had yet to play in the major leagues at all.
Also, as a player from Venezuela, he likely comes from a poor family, and the Astros had initially declined to sign him as an amateur because of his small stature. He came back to try out again a year later and signed for a very modest $15,000 bonus.
In short [no pun intended], Altuve was likely particularly susceptible to a contract offering him immediate security, and I suspect the team fully took advantage of the player’s insecurities about his size and the fact that his status as a major league star was still somewhat up in the air. Never mind that 50 years ago the Astros had another under-sized 2Bman who went on to become the greatest 2Bman ever.
When Altuve signed in July 2013, he was batting around .290, but his OPS was down from the year before, in a place where he might well have thought he was only one extended slump from being sent back to the minors.
The lesson to be learned from Altuve’s contract, perhaps, is that best time to offer a young player a long-term extension is during or immediately after his “sophomore slump” season, when the player’s value and self-confidence are temporarily down but are much more likely than not to rise again.
I would guess that more than half of young position players who establish themselves as major league regulars by their age 23 season have a down year in their second or third full major league seasons. The conventional wisdom is that it takes the league’s players about a year to find the flaws in a young but talented player’s game, and then it takes about a year for the youngster to make the counter-adjustments necessary to eliminate or minimize those flaws.
If the “sophomore slump” season happens in or before the youngster’s age 24 season, I suspect that it is much more likely than not that the young player will go to bigger and better performance in his peak seasons from age 26 through 28 or 29 than he had in his first big seasons. The Astros are a team that reportedly puts a lot of weight on analytics, so I am sure they were well aware of what the actual odds are when they made their offer to Altuve. The lucky part for the ‘Stros was that they were dealing with a player who put a particularly high value on security at that age and stage in his career.