Every organization has trends. They might not be an explicit blueprint, but typically, an organization will stick to a certain script.
For the New York Yankees, it's about using the depth of their farm system to bolster needs at the trade deadline that go unaddressed in the offseason due to a self-imposed salary limit. It's not paying relievers exorbitant amounts of money because of their volatility, while settling for Matt Blake reclamation projects and trades for closers on rookie contracts.
At the same time, one other thing has been made abundantly clear over the last six years: the Yankees do not extend players early.
While it has existed throughout baseball history, we've seen a sharp increase in extensions for young players, which has stopped them from reaching free agency over the last decade. Despite this, the Yankees are one of the few teams that avoid it for several reasons.
But every rule should have an exception. That exception should be the 25-year-old superstar who's projected to win the Cy Young Award unanimously next month: Cam Schlittler.
Why the Yankees are apprehensive to extensions
It seems like every other week we hear about a new pre-arbitration extension for a young phenom across baseball, as they get progressively younger and younger. A few years ago, it was rare to see someone who'd been in the league for two years get an extension, but now teams are openly extending top prospects who haven't even made the majors yet.
It's not universal, but it's happening across baseball as a strategy for small-market teams to avoid massive arbitration raises and end up in a Tarik Skubal situation where you have no choice but to trade him. Even teams with spending capacity like the Atlanta Braves, Boston Red Sox, and San Diego Padres have utilized it.
The benefits are clear: locking up a premier young talent for additional seasons and, if they reach their potential, getting them for less than market value. It is why Ronald Acuña Jr.'s contract is considered by far the best in baseball. Alex Anthopoulos took a risk and benefited spectacularly.
So why aren't the Yankees doing it? Well, the downsides are pretty rough too.
For every success story, there's a crippling failure. The Seattle Mariners gave Evan White $24 million before he reached the majors in 2019, and he was out of baseball a few years later. The Red Sox are surely kicking themselves over the $60 million they gave to Kristian Campbell, who spent all year in Triple-A. Austin Riley, while incredible when he signed his massive $200 million extension in 2023, is now one of the worst contracts in the sport. And not due to his baseball skill, the Rays' investment in Wander Franco has aged extremely badly.
Meanwhile, the Yankees have been burned by their last two rookie extensions, both occurring in the spring of 2019 when the concept was starting to become super popular. They gave two of their foundational players at the time, Aaron Hicks and Luis Severino, contracts that would buy out some of their free-agent years for $10 million a year. What could go wrong?
Both failed deals showed two different sides of how this can go wrong: injuries and regression. Severino signed for five years and $52 million (including his 2023 club option) and pitched a grand total of 18 innings over the next three seasons due to recurring injuries. He rebounded to throw 102 good innings in 2022, which led to his option being picked up, only to pitch to a disastrous 6.65 ERA in 2023 before departing in free agency.
As for Hicks, he was a top-flight center fielder when he signed a seven-year, $70 million extension at age 29. It was a more ambitious deal, sure, but for a player coming off consecutive 4-WAR seasons with a 120 OPS+, it was more than a fair contract. Hicks had way more injury concerns than Severino, but the Yankees assumed the risk.
As we know, the extension was even more of a disaster. Hicks played just 59 games in 2019 and underwent Tommy John surgery after playing the postseason with a torn UCL. He was great in a rebound 2020, but missed 130 games in 2021 due to a wrist injury. Then, adding in an awful 2022 and a miserable start to 2023, the Yankees cut bait on the final 2.5 years of his contract. They released him on May 26, 2023.
The fear of those extensions has likely kept them from extending guys like Gleyber Torres (especially after his 2020-21 extended slump), Gary Sanchez, and Aaron Judge. It's also likely kept them from considering extensions for any of their top prospects, like what Seattle and Milwaukee have been doing. Imagine if Jasson Domínguez and/or Anthony Volpe got an extension in 2023!
The Yankees are comfortable using their financial advantage as the ultimate failsafe. If a young player becomes a superstar, we'll pay him when he hits the market. Until then, we're not going to risk overpaying. However, the Yankees should take that risk with Schlittler.
Why Cam Schlittler is the exception
Life is about maximizing reward and minimizing risk. That's especially true when you're in a baseball front office. Why didn't more teams go after Japanese phenom Munetaka Murakami? The risk. Why did teams fawn over Yoshinobu Yamamoto? The reward.
Schlittler has already eliminated much of the risk that exists in some of these extensions. Some of these players show promise, but haven't shown they're top-shelf stars. Schlittler has. If there was any doubt entering 2026 about whether the fastball-heavy kid from Northeastern would fare in a full season, it's been eliminated.
He has had a historically dominant start to his career. Through 47 career starts, he's pitched to a 2.23 ERA with 323 strikeouts and 80 walks across 266.2 innings.
He was the ace of the league's best rotation in 2026. Schlittler became the first pitcher in the American League since Pedro Martinez to pitch 190+ innings of sub-2.00 ERA baseball en route to a likely unanimous Cy Young Award in his first full season. Combine that with his postseason heroics? This is a foundational figure.
It's unique that a player is this good with little service time. A direct comparison is 2017 Aaron Judge, who should've become the second rookie in MLB history to win MVP, but the extension craze wasn't nearly as popular then.
By the time people started to look to Judge for an extension, he had gone through several seasons of battling unfortunate injuries, coupled with regression from 2017. The Yankees offered him a deal before the 2022 season based on merely being a star, but Judge's incredible walk year made him worth nine figures alone.
The benefit of an extension would be to lock up Schlittler's prime into his early 30s for a below-market rate, which will help the team as they transition eras. Max Fried and Aaron Judge's contracts run into the start of the 2030s, so some cap relief will be important if those two are ineffective in their old age. It would also work well to guard against a salary cap.
There's risk, because there's always risk. Pitcher extensions are way rarer because their arms are ticking time bombs. It's what happened with Severino. No prior serious injury history, looking like a clear ace, then one day, he couldn't stop getting hurt. This could happen to Schlittler, which is why I ultimately think it won't happen.
Still, it would take an utterly disastrous outcome for Schlittler to fall the way Severino did. They had a reason to be cautious about a lot of potential extension candidates lately, but they should take a chance here.
The other risk is that it would accelerate his earnings. The Yankees are on the books for $280 million next year when accounting for arbitration increases, and any extension would count toward the luxury tax through its average annual value.
If Schlittler agreed to make $15 million per season on a deal, the Yankees would treat it as if he made $15 million this year for luxury tax purposes, even if he'd only make $2 million or so in cash. It's effectively a front-loaded deal, as Schlittler will make more than the Yankees have to account for later in the deal.
What's a framework to get this done?
This is the hard part. Because of his service time, Schlittler won't become a free agent until 2031. Now, it can absolutely change due to the upcoming labor negotiations that will undoubtedly see a push to decrease the six-year rookie contract structure. But as of now, that's what we have. The Yankees have control of Schlittler for another five seasons.
As a result, there isn't really a comparison for his success. Paul Skenes is the closest comparison, but he hasn't extended with a very frugal Pirates ownership group. Before his injuries, Spencer Strider was the star Schlittler is, and he signed a six-year, $75 million pact in 2023. The largest pre-arb extension for a pitcher was Chase Burns' recent seven-year, $105 million pact that also bought out five years of control.
Schlittler's pedigree and trophy case will absolutely demand more than these two. He's also a tad older than the two of them, meaning this contract will likely eat up much of his prime and earning potential. Schlittler has less incentive to sign now and delay his free agency to his age-32 season.
I'd think this would only be worth it for the Yankees if they bought out multiple free-agent years, so this might bleed into the $140-150 million range or higher over seven years. That would be crippling for their offseason budgeting, but would allow them to avoid potentially giving Schlittler $400 million or more when he hits free agency in five years. You either sacrifice now or in five years.
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