Red Sox Rumors: Yankees an X-Factor in J.D. Martinez contract decision

Whether or not the Yankees pick up Edwin Encarnacion’s team option may have an impact on if J.D. Martinez opts out of his deal with the Boston Red Sox.

The approach the Boston Red Sox take to filling out their roster this offseason will be heavily influenced by J.D. Martinez‘s decision regarding the opt-out clause in his contract. The budget will be tight for a team intent on slashing payroll in order to dip below the luxury tax threshold if Martinez stays. Boston would have more to spend on pitching if the veteran designated hitter tests free agency but his departure would also leave a giant hole in their lineup.

Martinez hasn’t given us many hints on what he plans to do, presumably because he’s waiting to see how the free agent market shapes up. MLB.com’s Anthony Castrovince explains how the New York Yankees could influence Martinez’s decision.

"“One X-factor in Martinez’ decision-making process could be the Yankees’ $20 million option on Edwin Encarnacion,” writes Castrovince. “If they turn it down, that adds competition in an otherwise light DH market. Martinez also must be mindful of how few bites he got two years ago, when he was coming off an incendiary second half with the D-backs, but only reached his five-year, $109.95 million deal because the Red Sox bid against themselves.”"

Martinez and Encarnacion are both sluggers on the wrong side of 30 whose defensive limitations make them best suited for the DH role. We can probably rule out any National League team giving Martinez the long-term deal he’ll seek if he opts out and his options are further limited by the few teams ready to contend and willing to spend. Adding Encarnacion to the free agent pool creates competition that could make Martinez hesitant to surrender the $62.5 million remaining on his current deal.

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There’s no doubt that Martinez is the better hitter. He’s hit above .300 in each of the last four season, including a career-high .330 in 2018. Encarnacion’s batting average has been below his career rate of .263 in each of the last three years, steadily declining to .244 this year. He hasn’t posted an OPS above .900 since 2015 while Martinez has posted a .900+ OPS in every season since 2015.

What Encarnacion can do is match Martinez’s power potential. Encarnacion topped 30 home runs for the eighth consecutive season and he had a pair of 42-homer seasons in that span. The threat of his bat gives the rest of the lineup a similar boost to what Martinez provides.

He’ll turn 37 before next season and his dwindling batting average is a concern but those factors will also keep the price down for Encarnacion. If the Yankees determine that he’s not worth $20 million then it’s hard to imagine he’ll get more than that elsewhere and his age may prevent him from getting a multi-year deal.

If he could be signed to a one-year deal in the $16-18 million range, Encarnacion would be a better value than Martinez. In that case, Martinez would be wise to pocket the $23.75 million he’s owed from the Red Sox and opt out next year when his salary declines for the final two years of his deal.

Martinez opting out probably ends his time in Boston. With their desire to duck the luxury tax and Mookie Betts‘ free agency looming next year, the Red Sox aren’t going to sign him to a new deal that pays him more money in the short term. There’s a scenario where they could sign him to a longer contract with a lower average annual value to lighten the tax hit but if he thinks he can find another $100+ million payday, Boston’s brass will show him the door.

In that case, Encarnacion would be a viable replacement. He could save them a few million bucks for tax purposes while providing a 30+ homer bat to anchor the lineup.

The Yankees aren’t in the habit of doing their arch-rivals any favors but if they let Encarnacion leave then they may inadvertently be helping the Red Sox – either by giving one of their best hitters incentive to opt in or by giving the team a cheaper alternative in free agency.