Nick Hundley Contract Extension Analysis

As we covered earlier, the contract extension talks between the Padres and Nick Hundley have heated up.  Corey Brock reported that while Jed Hoyer and company started the discussions, Josh Byrnes and the current front office may have a deal done soon.  If the Padres do extend Hundley, it means two very important things; 1) Chase Headley‘s extension becomes increasingly unlikely, and 2) The team thinks Yasmani Grandal needs some grooming.

The first argument that can be made about my two points above is that the Padres can simply trade Hundley after the extension if they want to bring up Grandal, and the Hundley extension is mutually exclusive of the Headley talks.  I will agree with the first argument, and that may very well be what happens.  A contract extension for Hundley in which his arbitration years and at least one free agency year is bought out makes him a very attractive trade target.  I will disagree with the idea that Hundley’s contract has little to do with Headley’s.

I’ve already made it known that I think Cameron Maybin‘s contract extension probably made Headley too expensive for the Padres to extend.  They may put something together still in hopes of trading Headley, or they may allow him to walk via free agency after final three arbitration years.  However, the fact that news is coming out about discussions with Hundley means to me the Padres placed their extension priorities with Hundley, not Headley.  If the team works a contract extension for Hundley, they will likely turn their focus to Carlos Quentin next.  All said, this means Headley will probably have to wait until the regular season to even truly broach contract extension talks.

Now, back to Hundley’s extension.  Hundley, like Headley, has three arbitration seasons left before he hits free agency.  He just got paid $2 million by the Padres this season as they avoided arbitration earlier this winter.  MLB Trade Rumors figures Hundley’s final three years of arbitration to be worth between $8-10 million.  As a free agent, if we follow the $5 million per 1 WAR calculations, Hundley should command at least a $10 million a year deal.  Last season he was worth 3.7 WAR.  He has been worth 5.2 WAR in his four years in the league.  He should settle in around 2 WAR.

For the Padres, Hundley’s contract extension needs to make save them some money on the back end while making him a nice trade target if they choose ego go that route.  This will require a contract that of course buys out Hundley’s arbitration years, but the contract will also need to eat up at least one year of free agency, probably two.  That being said, it would make sense for the team to pursue a five year deal.  It would also make sense for Hundley to pursue a long-term deal like that.

Last season, Hundley was forced out of action for some time with a strained right oblique.  He played in 82 games last season and 85 games in 2011, but never more.  The team would certainly like to see him up around 100 games, because they don’t intend to do a straight platoon split with Hundely.  However, injuries and fatigue may prevent that from happening.  That being said, Hundley would benefit from five years of guaranteed money from the Padres.  If Joe Mauer and Buster Posey have proven anything, injuries can happen in the blink of an eye, and performance can dip.  A five year deal for Hundley will at least give him the peace of mind of knowing his has money in his pocket no matter what happens.

For the Padres, a five year deal eats up Hundley’s arbitration years and two years of free agency.  The free agency years are the biggies.  That is where Hundley would command more money, and if contract talks were held off until then, the Padres would have to pay much more than they would like.  Given Hundley’s current salary, the projected earning from his next three years of arbitration, the Padres would be smart to get a deal in the neighborhood of five years, $15 million.

At $3 million a year, the team would be paying about what Hundley is supposed to make in arbitration, but they would be saving themselves quite a bit on Hundley’s two free agency years.  If we use the MLBTR arbitration years projection (using $9 million to split the difference), and the approximate $10 million per year Hundley could earn as a free agent if he continues to put up at least 2 WAR, the Padres would be saving themselves $14 million with a five year, $15 million contract.

Of course, projections are just that.  They are guesses.  Hundley could earn less in arbitration.  Remember arbitrators give more money for power and RBI, two things Hundley lacks.  Hundley could also command far less than $10 million in free agency.  He may enter free agency with numerous other catchers, thus reducing his value.  All that being said though, it seems clear that a 5 year, $15 million contract would benefit both parties nicely.