Shohei Ohtani has been a Los Angeles Dodger for two days, and a new contract update is out. The Dodgers are deferring $680 million of his 10-year contract.
The record-breaking deal — initially announced by Ohtani on his personal Instagram — is worth 10 years and $700 million. ESPN’s Jeff Passan announced the news on Twitter, where he also noted “significant deferrals that include most of his salary…”
Nobody knew Ohtani’s deferrals would be that significant, but it puts the Dodgers in an amazing position. They need to win during his contract.
Now, of course, Ohtani will still make the $700 million in his contract. During the next 10 years, Ohtani will make $2 million annually. The $68 million deferrals will be paid every season from 2034-2043 — which will add up to $46 million annually when it’s all said and done.
Ohtani’s decision to take the historic deferrals makes a ton of sense. According to ESPN’s Alden Gonzalez, Ohtani makes around $45 million annually off the field. His ability to take a pay cut gives the Dodgers more financial flexibility.
Let’s look at how the Dodgers can optimize their extended cap space.
The most obvious action for the Dodgers is to spend on free-agent starting pitchers. Out of all the free-agent starting pitchers, the Dodgers have been most linked to Japanese superstar Yoshinobu Yamamoto.
The 25-year-old right-hander has dominated over his seven years in the Nippon Professional Baseball League. Yamamoto is a three-time Pacific League MVP, a three-time Sawamura Award winner, which is given to the best pitcher each season, and a three-time Triple Crown winner.
The Dodgers are far from the only team wanting to add Yamamoto. The New York Mets and New York Yankees are top players for his services, too, which could potentially cost over $300 million.
While the Dodgers want to add Yamamoto, Los Angeles is active in the pitcher trade market as well. Players like Dylan Cease, Shane Bieber and Tyler Glasnow could be in the mix for the Dodgers. The White Sox have been open about trading Cease to an aggressive team. Cease, who finished second in the 2022 American League Cy Young award, has two seasons left on his contract.
Bieber and Glasnow, who are both fantastic players when healthy, have one season before unrestricted free agency.
While these other teams are active, the Dodgers may have an advantage. We’ll see in the upcoming weeks if this Shohei Ohtani contract update allows Los Angeles to be extra aggressive.
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