On February 15th, 2019, the Yankees and Luis Severino agreed to a four-year, $40 million contract extension. The deal included a club option for 2023 that, if exercised, will make it worth $52.5 million. The young ace inked the deal a week before his 25th birthday, and the Yankees locked up one of the sport’s best young starters.
It seemed like a win-win at the time. Severino guaranteed himself life-changing money, and the Yankees avoided arbitration with one of the club’s best young stars… nothing to sneeze at considering they locked in cost certainty and avoided the possibility of ham-fisted bumbling during another prominent arbitration case.
The baseball gods are fickle, though. Severino has been injured for virtually the entire last two calendar years, and the last two MLB seasons and counting. He has made only three starts for the Yankees since he signed his extension, and a best case for his return will put him in pinstripes this summer. His first rehab start gave a little light in the night for a fanbase that desperately needs it, although Severino isn’t going to solve the Yankees’ problems in the batter’s box.
But despite the ill-fortune on the injury front, signing him was absolutely the correct move by the Yankees. It seems like a distant memory, but Luis Severino was electric, and often dominant, in 2017 and 2018. In 63 regular season starts, he won 33 games, struck out 450 hitters in 384.2 innings, put up a 4.64K/BB ratio, and compiled 11.0 fWAR.
In Game 4 of the 2017 ALDS, with the Yankees’ season at stake, Severino bounced back from a shellacking in the Wild-Card game. The Yankees faced elimination down two games to one to Cleveland, and he pitched seven innings of three-run ball, striking out nine and sending the series to its dramatic fifth and final game.
In May 2018, after the Yankees’ loss to the Astros in the 2017 ALCS, Severino threw down the gauntlet at Minute Maid Park in Houston. The young hurler pitched an absolute gem, a complete-game shutout wherein he struck out 10 Astros and gave the Yankees and their fans at least a vestige of vengeance for the 2017 playoff loss. Severino’s performance is one of those games that is etched into my memory, and one that points to how spectacular he is when everything is working.
I hope we get to see that Severino again, but no one knows what he will look like when his Tommy John rehab is complete. John Griffin wrote here about Severino’s rehab based on the journeys other pitchers have recently taken to get back to The Show. It’s also important to acknowledge that the 2019 and 2020 seasons are inarguably sunk costs with no immediate return on the Yankees’ investment.
Nonetheless, the contract extension was the correct move for the Yankees to make with the young hurler. And not just because, if his recovery approaches a best-case scenario, the Yankees can plug a genuine number two starter… perhaps number one-B… in behind Gerrit Cole for 2022 and 2023.
It was also the right move to make because, though some fans might hate it, this is a front office that, to paraphrase Robert Baratheon from Game of Thrones, loves “counting coppers.” The salary cap… er, I mean the luxury tax… looms large for ownership and management. Contract extensions like Severino’s lock in cost certainty and remove the possibility of an arbitration ruling adversely affecting the club’s budget.
Admittedly, the falls from grace for many current young Yankees over the last two seasons will likely preclude them from large arbitration payouts. If Gleyber Torres can add some power to a bat that has been much better since he came off the COVID-19 IL earlier this season, and if he can sustain that, he might change that calculus – and I suspect literally everyone associated with the Yankees is rooting for that outcome. Other than perhaps Torres, it is an open question whether the Yankees try to lock up any of the other “Baby Bombers” who have debuted over the past several seasons before they hit free agency.
It remains to be seen how the final two-plus seasons (assuming the Yankees exercise Severino’s 2023 option) play out and what the final verdict on his extension is. In the coming seasons, though, the Yankees have other young players approaching the majors that, if they play the way the club hopes, will have the potential to earn big bucks. The club will almost certainly lock up some young players in the future, buying out arbitration and maybe some free agent years. Some deals will likely work out, and some will not.
It is not as though the Yankees are the only club that locked up a young star before they hit free agency. Most recently, the San Diego Padres inked superstar Fernando Tatís, Jr. to a monstrous 14-year, $330 million extension.
Sometimes, these deals are heists for the teams involved. There is perhaps no better example of this than the eight-year, $100 million dollar contract that Ronald Acuña, Jr. signed with the Atlanta Braves in April 2019.
WAR is an imperfect metric. Nonetheless, working from the idea that one WAR is worth about $8 million, Acuña, having compiled 10.8 fWAR since signing the contract, will likely outperform his contract by the end of this regular season… and the Braves also hold two team options that could extend its length to ten years. When these extensions work in the team’s favor, they really work in the team’s favor, to the point of robbery.
In cases like Severino’s, with a record of elite performance and a clean injury history, if the results of the extension are not what the player, the club, or the fans were hoping for, that does not mean the contract was a mistake. The correct decision does not always lead to the desired outcome, especially when accounting for injury.
Severino still has time to make his extension look like the win-win it initially seemed. He is working his way back and I suspect he, the Yankees, and Bombers fans are all hoping to see Peak Sevy throwing smoke in pinstripes for the foreseeable future.