The Manny Machado Extension

Because thinking about the current Orioles makes me angry (I was sitting in left field for Sunday's game and came home with only a bad sunburn to show for it) this post will instead involve future Oriole teams. One of the main goals of any franchise is to find their superstar. The player that is elite on the field, marketable, and becomes the face of the franchise. The Orioles have found their superstar in Manny Machado

Machado, playing in his fourth big league season, turned 23 a month ago, already has two all star appearances, a top ten MVP finish, and a platinum glove. Machado has always been a defensive wizard, but this year has brought the game forward at the plate. In 2015, he has increased his batting average, increased his walk rate, cut his strikeout rate, and increased his power output. He has become one of the best hitters in the game playing an important defensive position at the highest level. Also, he's 23, did I mention that?

Finally, a player the Orioles drafted in the first round that has not only met expectations, but has exceeded them. Yet, a caveat. The Orioles only have Machado under team control for three more seasons. These years will be his arbitration years which means salary increases are coming and coming fast. In recent seasons, teams have bought out players' arbitration years in order to provide some amount of cost certainty going forward. In exchange for the guaranteed money the players have given up some free agency years at what might be considered below market prices. So, what might one of these extensions might look like for Machado?

Well it certainly will not be cheap. Machado is so young that guaranteeing a large sum of money now is not as important to him as it might be to a 27 or 28 year old player who wouldn't be a free agent until 31 or 32.. On his current track, he will be going into his age 26 season as a free agent. His theoretical prime years awaiting him. That is an enviable position to be in for a baseball player. So, we need to find some similar comparable players that have recently signed extensions in order to figure out one for Machado.

Well, one of the few players definitively better than Machado, is Mike Trout. Starting in 2015, Mike Trout is on a six year $144 million contract. While that total amount is not high, the number of years is important. In 2015, Trout is making $6 million, that jumps to $16 million next year, $20 million the year after that, and ends with three straight years of $34 million. That leaves Trout as a free agent going into his age 29 season which allows him to get at the very least one more large contract.

Not to mention, his first contract guarantees him and his family monetary security for the rest of forever. It appears, rather than total value, Trout went for a short term gain betting on himself to hit it big a second time.

Another superstar player to sign an extension recently was Giancarlo Stanton. Stanton, before the 2015 season, signed a 13 year $325 million contract. Stanton is a little older than both Trout and Machado, but still would have been a free agent at age 28. He salary is slightly lower in the beginning of his contract, not reaching over $15 million dollars until 2018. From there it steadily goes up, paying him $32 million a year for three years towards the end before going back down and ending in 2028 when he will be 38 years old.

An interesting aspect of Stanton's contract is that he has an opt out clause following the 2020 season. Meaning, that Stanton could have a bite at the free agency apple going into his age 31 season and the Marlins would not have paid him his highest guaranteed years if he chose to opt out of his deal. An interesting wrinkle that may become more common in baseball player contracts as time moves on.

Stanton chose his first big contract to give him some flexibility, but still received the guaranteed years on the end and will make gobs and gobs of money in the meantime. Not a bad life to have.

Those seem to be the options for Machado. Sign with the Orioles for a short term with a high average annual value and still hit free agency at a young age. Sign with the Orioles for a very long term and add in a little flexibility. Or, bet on himself and wait until he is 26 and sign on the dotted line somewhere for however much money he wants. Not knowing his personal priorities, I have no idea which path he would choose.

An important thing to note here is that in his first four seasons, Machado has already had two major knee injuries. Now, these knee injuries appear to be caused by a congenital defect that was repaired with surgery, but still two major knees surgeries before a player turns 25 should be a read flag for any team. Anyways, to the numbers

I figure a Mike Trout type extension would be around six years and a $150 million for Machado. That would guarantee a salary of $6 million next season and then quickly escalate to $18 and $21 and then finish with three years of $35 million. This leaves Machado with $150 million of guaranteed money and--similarly to Trout--makes him a free agent at age 29 and gives him another shot at a massive contract.

A Giancarlo Stanton type extension for Machado would be for 16 years and $410 million dollars. I should have played baseball more as a kid. That again gives him $6 million next season, but it escalates slower only going to $10, then $15, $22, and then one year of $30 million. I gave him his opt out after that season going into his age 30 season in 2023. The rest of the contract escalates to $35 million before going back down to $25 million at the very end with a team option in 2031 in his age 38 season.  The heavy guarantees at the end of the contract and the opt out allows for some leaner up front seasons.

I do not know what type of contract I would prefer for the Orioles or what Manny Machado would prefer and I do not really care. All I really care about is that he is an Oriole for a very long time. Superstars that a team drafts and develops only come along so often and the Orioles need to keep the one they have and do it by any means necessary.