Angels, Shohei Ohtani Avoid Arbitration With One-Year, $30MM Contract For 2023

The Angels and Shohei Ohtani have avoided perhaps the most unique arbitration case in baseball history by agreeing to a one-year, $30MM pact for the 2023 season.  Ohtani is still scheduled to reach free agency following the 2023 campaign.  Ohtani is represented by CAA Sports.

The two-way star becomes the 20th player in baseball to receive a $30MM average annual value on a contract, and that $30MM figure also establishes two other notable thresholds.  Ohtani will now receive the largest salary ever for an arbitration-eligible player, and he also gets the biggest year-to-year raise for an arb-eligible player, after he earned $5.5MM this season.  That $5.5MM salary was established in an earlier extension that avoided arbitration, as Ohtani and the Angels agreed to a two-year, $8.5MM contract in February 2021 that covered the first two of his three arb-eligible years.

At the time of that deal, Ohtani has pitched only 1 2/3 total innings over the 2019-20 seasons, due to a Tommy John surgery and then a flexor strain.  He was also coming off a mediocre year at the plate, hitting only .190/.291/.366 over 175 plate appearances during the pandemic-shortened 2020 season.  Though Ohtani was hardly the only player to struggle under the unusual circumstances of the 2020 campaign, there was speculation that his 2018 rookie season might have been his peak, and that Ohtani would be better served by choosing either hitting or pitching.

Instead, Ohtani bounce back with two of the most extraordinary seasons in baseball history.  Since Opening Day 2021, Ohtani has hit .267/.366/.560 with 80 home runs over 1282 plate appearances, while also posting a 2.72 ERA and an array of dazzling secondary metrics over 291 1/3 innings.  After winning AL MVP honors in 2021, it looks as if Ohtani will be at worst a second-place finisher in this year’s MVP race (due to Aaron Judge’s all-timer of a season), and he’ll also earn a good chunk of votes in the AL Cy Young Award race.

With this in mind, it can certainly be argued that $30MM is still a bargain from the Angels’ perspective, considering that Ohtani would earn hefty salaries if he was “only” an All-Star hitter or “only” an All-Star pitcher.  It would’ve been fascinating to see what arbitration figures the Angels and Ohtani’s camp would’ve submitted in this unprecedented scenario, but this agreement sidesteps that possibility.

Los Angeles now has three players earning at least $30MM in 2023, as Ohtani joins Mike Trout ($35.45MM) and Anthony Rendon ($38MM).  In practical terms, it doesn’t change much for the Angels’ payroll situation, as the team naturally figured it would be paying Ohtani some type of gigantic salary in his final arb-eligible year.  In pure dollars and cents, it doesn’t actually represent much different from the Angels’ 2022 payroll, as the since-released Justin Upton was earning $28MM in the final year of his contract with the club.

Ohtani’s future beyond 2023 remains a mystery, as he’ll be heading into free agency presumably still in his prime both on the mound and at the plate.  Though Ohtani turns 29 in July, his two-way ability might still land him the…