Transaction Analysis: Keeping Kluber and Carrasco in Cleveland

CLEVELAND INDIANS Team Audit | Player Cards | Depth Chart

Reportedly agreed to a five-year extension with RHP Corey Kluber worth $38.5 million that includes two club options worth $13.5 and $14 million, respectively, and a three-year extension with RHP Carlos Carrasco worth $22 million that includes two club options. [4/5]

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That’s Chris Mellen’s Cleveland Indians top 10 prospects list that ran in BP back in January, beginning with Francisco Lindor and tracking down through a host of mostly position players.

The first time you stop on a pitcher’s name, it’s Justus Sheffield—an 18-year-old who has never pitched beyond a complex league and recently pled down a burglary charge, if that’s something that you think negatively affects his timeline. Then it’s down to No. 10 and 20-year-old Mitch Brown, whose realistic role, according to that top-10 list, is “no. 5 starter/long reliever” and who pitched in Low-A last year.

So on the Progressive Field mound, what you see is—not just for the immediate future—what you got.

What they got is pretty good though, and on Sunday, what they got became theirs for even longer. The years of the contracts make for confusing reads because of the inconsistency in when they start, but the two moves both locked in some free agency years. Reigning American League Cy Young Award winner Cory Kluber was signed from 2015-19 for a reported $38.5 million with escalators and two team options for 2020 and 2021 that could take the contract up to $77 million. And Carlos Carrasco got his 2016 and 2017 arbitration years covered as well as 2018 and team options for 2019 and 2020 in his deal.

If you looked in the dictionary under “Buying high,” there would probably be no entry. But if there were one, it would probably use these deals as an example.

Kluber, who has been steadily progressing as a relatively late bloomer, was an effective starter in 2013, so this wasn’t totally out of nowhere and paying for one fluke season. He was, however, one of only 10 pitchers even to reach 5 WARP at 27 or older having never hit 3 WARP before—and he was 6-plus, 28 and 2, respectively, so no (egregious) “cherry picking” here.

And then there’s Carrasco. Not even a starter from May to early August of last season, he re-entered the rotation on August 10 at Yankee Stadium and finished the season with 11 walks and 78 strikeouts in those final 69 innings to go with a 1.30 ERA.

So why make the commitment to two fairly unproven starters now? Why not in a year when we see if Kluber can replicate what he did last year and whether Carrasco can show a whole year’s worth of that performance (or any performance) for the first time?

Waiting until the winter could have absolutely worked. The team had control of both of them not only for next year but for the following year, and for Kluber, even beyond.

If you’re the team, your half of the decision on whether to negotiate now or to go year-to-year depends on several factors.

1. The chance he gets hurt would make it less attractive to do it now.

1a. The chance he gets worse would make it less attractive to do it now. Of the eight players on the list above who played the year after—Hughes and Kluber obviously the exceptions—nobody’s WARP went up. Nor would you have expected it to. Plexiglas principle and all, even if these weren’t the extreme breakout performances.

Now, it’s not as simple as saying a drop will mean less money. You’d pay a lot more for a guy with a 6-win season and a 5-win season back to back than just the breakout 6. Kluber, though, with no significant performance history to go on, has a very high probability of regression that might make next season a more attractive time to negotiate.

2. The chance you’ll have to pay more would make it more attractive to do it now. On the team side, as has been discussed before, you want to bring a guy to the table when he has less money, not even accounting for expected performance. And another season of anything like Kluber’s 2014 or a full season of anything close to Carrasco’s final two months make them elite level players who will command top-level salaries.

3. The chance the economics fundamentally change could affect things. This probably won’t happen between now and opening day 2016, but it’s a consideration for longer-term decision making.

4. The chance he won’t re-sign with you in a year is an important factor too, and this is the one that catches the eye here. The pitcher could decide that he wants to hit the market—a lot of times this is tied to performance discussed in No. 1a and No. 2, but if a guy wants to negotiate now, there’s no guarantee he will in a year, and then this benefit of control is gone.

This is not a constant risk that all teams would value same, and the Indians probably see it as a higher risk than most teams would for the same two pitchers with the same performance histories and expectations. Thus the price they’d be willing to pay to do it now would be higher because it’s insurance for the team against that risk.

The Cleveland rotation on the eve of the season is Kluber, Carrasco, Trevor Bauer, Zach McAllister, and T.J. House—with Danny Salazar starting the year at Triple-A Columbus. They’re young enough that some of those guys should make it to 2018, but the back end is a little iffy and there’s always attrition anyway.

For many teams, we’d be starting to pencil in guys from the farm for 2018 already, but with this system being so position player-heavy, that’s not something that the Indians have as much of a luxury to do. They are also typically not big spenders on the free agent market, which makes the importance of just having guys under control that much higher. The premium they’d put on that would counteract concerns like lack of experience and the chance that they get worse and you could do better negotiating the next offseason.

This is not to say these are just bodies—they’re two extremely talented pitchers who can be the frontmen of the rotation for the rest of this decade now.

But to the Indians with their whole organizational picture, there was even more of a premium on control than the market as a whole would have, so missing early on these two guys is comparatively better than missing late.