MLB Free Agency: The highs and lows of long-term deals

Bryce Harper and Manny Machado are both seeking lengthy contracts in MLB free agency; what’s the likelihood that those deals will make long-term sense?

Overlaying the winter meetings is an assumption that either Bryce Harper or Manny Machado – or both – will sign a long-term deal during their time in MLB free agency. Their agents have talked in terms of up to 10 years at packages exceeding record levels.

Already one such deal has been finalized. The Washington Nationals agreed to terms with left-hander Patrick Corbin on a six-year, $140 million package. The Nationals were said to have won out when neither the Yankees or Phillies would move beyond five years.

Whether due to performance fluctuations or health, long-term contracts are fraught with peril. Since 2000, more than 100 contracts beyond five years in duration and $50 million in value have been agreed to. That provides a strong data base on which to judge the wisdom of those long-term deals.

Here are some of the most salient observations from that data base.

• Measured by WAR, the average first-year production of players signing such contracts has been +3.7. That production declines in direct linear fashion through subsequent seasons: to 3.6 in year two, then to 3.3, 2.9, 2.1 and 1.4 by year six.
• It is possible, although not likely, for such deals to pay off big for the signing team. In eight percent of the cases, the signing player averaged at least +5 WAR for the deal’s duration. That happened with Miguel Cabrera’s first (2008-15) long-term deal with the Tigers, it happened with Albert Pujols’ 2004 deal with the Cardinals, and it happened most recently with Mike Trout’s ongoing 2015 contract with the Angels.
• In one of every five contracts, the signing player averaged better than +4 WAR, making that player a plausible All Star.
• On the other hand, in 41 percent of cases the signing player averaged less than 2 WAR per season. For context, the average WAR for all players in 2018 was about +0.8.
• In only 17 instances did a player’s performance improve from year 1 to year 4. In only nine cases did that player’s value increase by more than two points of WAR.
• By contrast, the performance of two dozen players signing long-term, $50 million-plus deals declined by more than two WAR from year one to year four.

Here’s a recap of the 10 worst long-term, plus-$50 million contracts signed since 2005 as measured by the sum total of WAR generated for the life of the contract. The heading shows the player, team(s) involved, length and cost of the contract, and the total WAR  generated during that contract.