Examining the Weak Market for Power Hitters

In an offseason that has seen two relief pitchers command $80+ million deals, it has been strange to see just how weak the market for some of the game’s premier power hitters has been. All-stars such as Jose Bautista, Edwin Encarnacion, and Mark Trumbo have had to settle for deals that fell well below their perceived values, Mike Napoli (34 HRs and 101 RBIs in 2016) and Chris Carter (41 HRs and 94 RBIs in 2016) remain unsigned, and no one seems to want to give up anything for Jay Bruce, who the Mets acquired just last August in the midst of a bounceback season. It’s certainly no secret that the long ball isn’t valued like it once was in the pre-moneyball era, but on the surface that seems to have reached a whole new level this year. The following player comparison serves as one example of this:

Year Age Runs HRs RBIs BA Contract
Player A 2015 30 100 47 117 .262 7 years, $161 Million
Player B 2016 31 94 47 108 .256 3 years, $37.5 Million

If you haven’t figured it out, Players A and B are current Orioles teammates Chris Davis and Mark Trumbo, respectively. Both players were extended qualifying offers in advance of free agency, rejected them, and ended up re-signing with the Orioles in January after many of their peers had already found deals. Now, looking past the “baseball card” statistics, it’s easy to see that Davis was a better player than Trumbo due to the fact that he’d had more sustained success, a substantially higher walk rate, and was better (though still not good) defensively. But the notion that Davis was worth 4 more years and $10.5 million more annually than Trumbo is simply ridiculous, and as I alluded to earlier Trumbo is only one player who’s seen his value take a surprising hit. But why is this happening? I’d largely attribute it to 3 factors:

The New CBA

Starting next year under the new CBA, teams will only have to give up a third round pick for signing players who rejected qualifying offers. This has definitely hurt the value of this year’s free agents who did the same to some extent, as they were tied to first round picks and suddenly became a lot less valuable. Since this incentivized players to return to their teams, only three players (Dexter Fowler, Ian Desmond, and Edwin Encarnacion) switched teams after rejecting their qualifying offers this season. Interestingly, the former two garnered more guaranteed money than Encarnacion despite combining to hit seven fewer HRs than him in 2016 (42-35), and this is partially explained by the next factor.

Age

At this time last year, it seemed like Edwin Encarnacion (3 years, $60 million) and Jose Bautista (1 year, $18 million with a mutual option for 2018 and vesting option and 2019) could both seek $100 million deals, but their ages ultimately played a role in cooling their markets. Teams are getting smarter about spending big money on older players, and both Encarnacion (34) and Bautista (36) are at the age where many begin to decline (or have already substantially declined). The aforementioned Mike Napoli is also 35 years old. This year’s market for power hitters is simply skewed toward older players (more on that in the next section), and they justifiably aren’t going to make as much money as their younger counterparts.

Free Agency in the Upcoming Seasons

While this year’s free agency had it’s share of good players, it pales in comparison to what the next couple of years have in store. Jake Arrieta, Eric Hosmer, Lorenzo Cain, Carlos Gonzalez, and Jonathan Lucroy headline a strong group that should see plenty of sizable contracts after the 2017 season, while Bryce Harper, Manny Machado, Josh Donaldson, and potentially Clayton Kershaw figure to break the bank if they hit the market in 2018. It’s a no-brainer for teams to hold out money with the hope of making a run at these star players, especially when considering the fact that they’d only have to give up a third round pick to poach a player who rejected his qualifying offer.
Given all of the factors listed above, the supposed devaluation of power this offseason seems more like an outlier than a definitive trend. Teams obviously still care about hitting home runs, but it’s important to note that nearly every power hitter on this year’s market had a fatal flaw that ranged from age to defense to OBP. Combine that with the changing CBA and the strength of upcoming free agent markets, and the stance teams are taking suddenly seems a lot more reasonable. Despite this, I’d argue that guys like Chris Carter and Mike Napoli should still be on rosters right now, as they’re capable of helping AL teams on short-term deals and aren’t attached to qualifying offers. But since fewer teams go with every-game DHs each year, it’s not entirely surprising that their interest isn’t what it should be. The main “winners” of this strange offseason have to be the teams whose players rejected their qualifying offers, as most of them either got their players back on deals with better-than-anticipated value or a first round pick that will no longer be available as compensation starting next year.

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