Breaking down Dodgers' Yoshinobu Yamamoto contract details from Thursday mega-deal

The Dodgers woke everyone up late last night when news broke that they agreed to terms with Yoshinobu Yamamoto.
World Baseball Classic Semifinals: Mexico v Japan
World Baseball Classic Semifinals: Mexico v Japan / Eric Espada/GettyImages

It is safe to say that this offseason for Los Angeles Dodgers is going to go down as one of the most consequential offseasons in the history of the franchise. Not only were they able to land Shohei Ohtani on the largest deal in the history of the sport of baseball and trade for Tyler Glasnow, but they also managed to get Yoshinobu Yamamoto to agree to a 12 year, $325 million deal.

In just those three guys, the Dodgers have added well over $1 billion worth of financial investment into their roster, which is just an obscene amount of money. Time will tell if that investment proves to be a wise one, as there is a lot of risk that comes with giving the amount of years and dollars to such a small group of players. However, let's first look at the terms of Yamamoto's contract ($) with the Dodgers and what it means for the team going forward.

Yamamoto Contract Details: Dodgers REALLY had to pay up to land righty

At the surface level, the $325 million that LA just paid to snag Yamamoto is the largest deal ever given to a starting pitcher ever -- with the huge caveat being that doesn't include Ohtani, who is a unicorn who can obviously both hit and pitch (probably). Yamamoto's guarantee is $1 million more than the Yankees gave to Gerrit Cole before the 2020 season and includes a $50 million signing bonus. While those are some nutty numbers for a guy that has yet to pitch in the big leagues, Yamamoto's age and stuff created simply too good of an opportunity to pass up, and the deal was really only possible because Ohtani deferred so much of his deal.

Unlike Ohtani's deal, Yamamoto's contract does not contain any deferred money and the cost to the Dodgers is actually significantly more than $325 million. Not only is LA going to have to pay luxury tax given that they are well into the penalty now, but they also have to pay an additional $50.625 million as a posting fee to Yamamoto's previous club, the Orix Buffaloes. If the Dodgers continue to remain over the luxury tax threshold for the next few years, the cost of this deal to the team could easily end up approaching $400 million.

The good news is that if you are looking at purely the annual value of Yamamoto's contract, it actually isn't that crazy as the just over $27 million per year over 12 years doesn't even crack the top 20 salaries in MLB for 2024.

The bad news is that Yamamoto's contract does include a pair of opt-outs. The opt-outs can trigger after years 6 and 8 of his 12-year deal (per Ken Rosenthal), so it is entirely possible that Yamamoto could try to leverage those opt-outs into getting paid even more if he shoves for the Dodgers.

Could Yamamoto end up being a bargain, despite how much the Dodgers had to give to land him? Absolutely, especially given how good his stuff looked during his time in Japan. However, this deal is far from team friendly, given that all of that cost comes with a lot of pressure and risk as well. We shall see if it pays off for the Dodgers in the short and long-term.

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