At the beginning of the Winter Meetings, the Cleveland Indians began to be linked to free agent slugging first basemen/DH Edwin Encarnacion. While there was an obvious roster and lineup fit for him, he is the type of player the Indians are usually not in pursuit of because of his age and contract demands. The Winter Meetings have come and gone and there has been no quelling of the rumors and the usual suspects and potential suitors to drop a boatload of cash Encarnacion’s way have dwindled or acquired cheaper options.
Following this path of logic, let’s assume there is a realistic chance one way or another the Indians are able to put an offer together that Encarnacion might sign.
Obviously, one of the best case scenario’s for both parties at this stage might be for Encarnacion to take a Yoenis Cespedes 2015 deal, a 3-year contract at something in the $20 million a year range (ignoring that it would blow away the Indians previous high for any contract AAV) with a opt out after the first year. He could have a tremendous 2017 in Cleveland, opt out next winter without a draft pick attached to him and try to cash in again.
Unfortunately for Encarnacion, he’s going to be 34 in January. Age won’t be on his sign like it was with Cespedes and Cespedes has value in the outfield still where Encarnacion is tied to DH and the occasional cameo at first base.
For that reason, that scenario probably won’t play out. At the other end of the spectrum, the five year commitment that he originally wanted will almost definitely not be in play in Cleveland. If someone offers him a five year deal, he will take it and would have by now if someone was going to offer that.
The Indians would probably prefer that Encarnacion take a two year deal, but unless literally every other team in baseball took out a restraining order against his agent and the Indians were the only team left, a two year deal also seems unlikely.
So, we settle somewhere in the three or four year window, which obviously represents risks to the Indians to which they’ve been burned by before. A three year deal would likely mean a high annual average and even if they could spread out the money over four years, then they guarantee a 38 year old a sizable chunk of money.
In case you need a refresher, Travis Hafner signed a 4-year/$57 million deal in 2007, keeping him in Cleveland through his age 35 season. After two top-10 MVP finishes in 2005 and 2006, he hit 83 homers over the last six years with 24 of them coming in 2007. He played in 100 games in a seasonjust once after.
Jake Westbrook signed a 3-year/$33 million deal in 2007. At age 30, he needed Tommy John surgery, missed most of 2008 and all of 2009. The Indians traded him in 2010. From 2004-2007, Westbrook made 121 starts for the Indians. From 2008-2010 he made 38 over the life of the extension.
Nick Swisher and Michael Bourn? I don’t think I need to re-open a mostly fresh wound, but, they overpaid for Swisher even for what they thought they were getting and they had to wait until Bourn’s market had dried up from what he thought it was to sign him (sound familiar?).
However, at the time the Indians were in a very different position. Terry Francona was coming in, Hafner’s contract was off the books and the Indians only major payroll obligations were to Ubaldo Jimenez, Derek Lowe and rising arbitration players.
At the moment, the Indians have arbitration raises for Cody Allen, Bryan Shaw, Lonnie Chisenhall, Trevor Bauer, Zach McAllister and Brandon Guyer. Carlos Santana, Bryan Shaw and Chisenhall are free agents after 2017. Michael Brantley, Allen and Andrew Miller will be after 2018 and the Indians would like to probably explore extensions with Francisco Lindor and/or Jose Ramirez before they hit arbitration as well as to extend Allen. That alone is going to bring the Indians payroll into uncharted territory.
Those all sound like reasons not to sign Encarnacion, or at least long term, but if the Indians decide to invest into this window before key players hit free agency or large arbitration raises, it’s best that everyone goes into a three or four year pact with Encarnacion paying three or four years for two at maximum.
Encarnacion’s 2016 K% rose to 19.7%, up 4% from 2014 to 2015, so that is a concern. The drop in exit velocity against fastball’s might be a place to look to explain that increase. It may signal some drop in bat speed.
Aside from the rising K% and slight dip in exit velocity vs. the hard stuff, there are other positive indicators. His BB% has remained consistently between 12% and 13%. The increase in his K% was probably responsible for his drop from 150 wRC+ in 2015 to 134 in 2016. However, his 42 homers were a career high and he has never been a BABIP dependent player (.270 for his career). These are all discernible skills that in theory and from example have aged well – the three true outcome player. We thought with his walk rate, Swisher was in the same boat with obvious less power than Encarnacion, but much of that had to do with Swisher’s fast declining health (he had never been on the DL in his career until Cleveland). Assuming health, the Indians can probably count on Encarnacion to produce 2016 like seasons or close to it for 2017 and possibly 2018. That explains why the Indians would like to be free of any financial commitment to him after two seasons.
If the Indians want to get back to the World Series and potentially gain more postseason revenue along with reaping some regular season revenue benefits from 2016 fall classic experience, investing in Encarnacion is a good buy – as long as they understand that they are probably paying for three or four years for two good seasons.
The window after 2017 or 2018 doesn’t close for the Indians. But Jason Kipnis begins to get older and make more money along with Corey Kluber and Carlos Carrasco. Lindor will become more expensive. Santana, Allen and Brantley will have had their initial contracts or years of control expired. The major risk of signing Encarnacion is how tightly it squeezes their operating cost and extending Lindor – which is a move that has to be made and the Indians need to plan any signings or payroll additions around that.
It will probably take at least three years to sign Encarnacion, possibly four. The Indians can probably handle three years although it would diminish the chances of Brantley, Shaw or Allen signing extensions. If they give him four years, a large chunk of their payroll may be committed to Kluber, Lindor and Encarnacion, limiting their ability to supplement the team and bank on prospects to pan out and place more pressure on drafting. We’ve seen this scenario play out before and it hindered the Indians long term and shortened their windows of contention.
So signing Encarnacion is a good investment, and as long as the Indians and their fans understand that like any free agent contract, the money is being paid for past production, not future and there’s a good chance they will be paying Encarnacion for three or four years to get possibly two years of Encarnacion-like production and hopefully a World Series title.
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