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February 8, 2005

Prospectus Today

The Ordonez Deal

by Joe Sheehan

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Last week, I wrote this;

If Magglio Ordonez signs for anything close to what Scott Boras is apparently asking for--five years at more than $10 million per--then the signing team is completely insane.

Even if Ordonez were to receive a clean bill of health, the five-year contract for more than $50 million would be a huge risk, because players decline from where he is. Add in the injury risk, and the chance that this contract would end up as an albatross is huge. You can address some of that in the contract, but what do you do when Ordonez is healthy, but slips to .280/.340/.460 with below-average defense in right field?

Over the weekend, the Tigers climbed aboard the crazy train by agreeing to a five-year deal with Ordonez for $75 million. The total value of the contract could climb to $105 million over seven seasons if options for 2010 and 2011 vest.

There are so many things wrong with this deal that it's hard to structure a column about it. For one thing, Ordonez gets a longer, more lucrative deal than Vladimir Guerrero got last winter. He'll make just $2 million a year less than Carlos Beltran--younger, comparable hitter, more defensive value, not coming off a broken season--will over the course of his contract.

Neither of those two players hit the market not having played baseball since June of the previous season. Ordonez, who suffered an injury to his left knee on May 19 in a collision with Willie Harris, has played in just a couple of games since then. He underwent two operations on the knee, then was diagnosed with bone marrow edema in the knee, which isn't something that typically shows up in "Under the Knife." Ordonez didn't play any winter ball; the Tigers have signed him based largely on doctors' reports and faith in mankind.

They took out some insurance, of course. If the knee isn't all right, if Ordonez spends 25 days on the DL this year because of it, the Tigers are only on the hook for $6 million, and can walk away from the rest of the contract.

The problem is, that's the best-case scenario for the Tigers, so much so that it might be worth their while to dial up Tonya Harding and get Shane Stant's phone number. The problem with this deal--OK, one of the problems with this deal--is that it's the classic free-agent mistake: signing a player who was great in his twenties and expecting him to show no decline in his thirties.

Ordonez reached the majors when he was 23, became a regular at 24 and a star at 25. While he reached the majors based on his tools, he developed some patience at the plate, posting respectable walk rates and high OBPs from age 26 onward. Ordonez's walk rates are below average, but still respectable, because he tends to hit balls hard in play. He doesn't strike out a lot for a player with his power. There is no question that he was a legitimate All-Star for the White Sox.

It's just that he's 31 now, he's lost almost all of his speed, and under the best of circumstances--no Willie Harris, no edema--he'd be expected to decline. Using Lee Sinins' Sabermetric Encyclopedia, I generated a list of comparables to Ordonez through age 30, players who had basically his performance record through that age.

The list is pretty impressive, filled with a whole bunch of guys who have spent or will spend a lot of years on the Hall of Fame ballot, and a couple who have been or might be elected. Dave Parker, Jim Rice, Fred Lynn and Eddie Murray are the notable retirees, while Larry Walker, Shawn Green and Jim Edmonds highlight some of Ordonez's best active comps.

Taking the best ten comps based on performance and position (knocking out Ivan Rodriguez, basically), here's what you find:


            Players     Total WARP      Ordonez
Age 22         8           18.2           DNP
Age 23        10           35.3            .8
Age 24        10           44.0           2.6
Age 25        10           57.9           5.6
Age 26        10           69.8           5.9
Age 27        10           69.5           6.6
Age 28        10           78.0           7.5
Age 29        10           59.7           8.3
Age 30        10           62.2           1.6
The group of comparables tracks Ordonez' career arc pretty well, with a slow build from 23 through 25 and an ages 26-29 peak. Here's what happens after that:


            Players     Total WARP
Age 31        10           54.2
Age 32         8           43.1
Age 33         8           45.4
Age 34         8           44.4
Age 35         7           26.6
Age 36         7           21.0
Age 37         5           12.2
The player pool gets smaller as some of Ordonez' comps, like Green and Cliff Floyd, aren't that much older than him. They're also two of the more frightening comparables if you're a Tigers fan, as neither player has been a star in his thirties. Edmonds, clearly the most valuable post-30 player in the pool, hasn't played his age-35 season yet, Vinny Castilla drops out of the age-37 pool, while Rice and Pedro Guerrero were out of the game at 37.

Even if you ignore the potentially career-altering knee injury, Ordonez can be expected to decline from seven-win or eight-win player at his peak to a five-win player through his decline phase. That difference is enormous, worth at least six million dollars a season in salary. It's the difference between a star and a regular, between a player's peak and the rest of his career. Between a contract that makes sense and one that ruins you.

The worst-case scenario for the Tigers isn't an injury, or even the Jim Rice career path that pushes Ordonez into an early retirement. No, worse for them would be the kind of decline Eddie Murray had, where he was still a decent player, and was very durable. If Ordonez is healthy enough to trigger his options for 2010 and 2011--loosely speaking, he needs to be a regular in 2009, at age 35, to make either possible--he could absolutely cripple the Tigers. An immobile corner outfielder hitting .280/.340/.450 and making $18 million is, in team-building terms, a disaster.

What's aggravating is that the Tigers made this exact same mistake just a few years ago, overvaluing a 30-year-old Bobby Higginson to the tune of four years and $35 million. They'd seen his peak, and they decided that he would keep having it over and over again. Higginson, who put up 7.5 WARP in 2000, has totaled 7.9 in the three seasons under his new deal.

In the short term--2005, maybe 2006--this contract should make the Tigers a better team. Even a past-peak Ordonez, if reasonably healthy, should put up a .300 EqA that will be a big improvement on recent Tigers' corner outfielders. It won't be long, though, before Ordonez's salary far outpaces his value, and eventually is used as the excuse for not retaining a Jeremy Bonderman, or an excuse for more "changes to the system."

The Tigers, though, can't blame any system, or boogeyman in the offices of the MLBPA. They walked into this one, and they will deserve what they get in return.

Joe Sheehan is an author of Baseball Prospectus. 
Click here to see Joe's other articles. You can contact Joe by clicking here

Related Content:  The Who,  Jim Murray,  Year Of The Injury,  Player Age,  Age,  Peak Age

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