Coronavirus Financial Impact on Atlanta Braves and Players
We take a look at the potential financial impact of the hiatus on the Atlanta Braves and some of their players.
Over halfway through April and we still haven’t watched the Atlanta Braves play a game. It’s like a nightmare. No, it’s worse than a nightmare. In fact, I’d rather be in a nightmare right now.
I had a nightmare last night where I was being chased by a tornado and it was destroying everything behind us. We (me and the stranger I was with) jumped into a trench and found our way to underground shelter (must have been some kind of post-apocalyptic scenario) and just when we thought we were safe, Captain Picard came out of the shadows in his full Borg garb and began reading sonnets with his mechanical voice…I woke up in a cold sweat and immediately wanted to go back.
The total financial impact of this crisis won’t be certain until after things get back to normal, or whatever that may look like in the future. A recent article in Forbes cited a report by John Tinker of G.research LLC. in which the Braves begin playing baseball on July 4 and come out with an operating loss of about $59 million. It’s an interesting article and I suggest you give it a read.
Essentially, Tinker’s estimates were that even if the Braves played 80 regular-season games or approximately half of a full schedule, attendance would be reduced 76% from the previous season, causing a 73% decrease in gate and concession sales, with total revenue dropping from $438 million in 2019 to $174 million in 2020. Again, this is based on a hypothetical July 4 start.
Resumptive Apprehension
The line of logic is that fans will be a little hesitant to jump out of quarantine right into a giant bowl of 40,000 people. Additionally, there will likely be games played without fans. in fact, there may be an entire season played without fans. We really don’t know what will happen, just like when Star Trek ended the season with Picard assimilated into the Borg.
The main point is that even if 50% of the games are played, the teams won’t bring in 50% of their revenue. The TV contracts will still payout on par with the number of games played, but that only makes up about half of the Braves’ revenue.
Meanwhile, player salaries will be dependent upon games played, not to mention the fact that the Braves have been covering employee salaries during this time of crisis and need and recently committed to doing so through May.
Players Potentially Affected
Players on one-year deals will presumably be adversely affected heading into next off-season while teams attempt to recover from their losses.
The Wall Street Journal discussed this notion in mid-March when assessing Mookie Betts’ situation and how even if he hit free agency on time (which he will) then his market won’t be what it was due to the significant financial impact each team will have suffered. They just won’t have the money to spend.
Now we’ll take a look at a few players on the Braves whose value could be severely impacted.
Adversely Affected Athletes
Cole Hamels signed a one-year deal for $18 million this past off-season. Hamels will be 37 in December and the longer we go without baseball the more you have to think his value diminishes for next season. Hamels has the intention of bouncing around between contenders on one-year deals to end his career as a grizzled gun for hire, only pursuing the biggest prizes.
“I can do one year here and there and just play as long as I can play,” says Hamels. “I think that’s what will help give me an opportunity to play on teams that are trying to go to the postseason. If you need one guy, I can just kind of bounce around.”
If Major League Baseball is unable to play at all this year, the market probably won’t be terribly high for a 37-year-old pitcher who didn’t get to play last season. Even then, we know how finicky pitchers are and how much time they require to get in mid-season form. There’s a chance we don’t see Hamels at his best this year in a shortened season.
Something else to consider is the idea that in order to fit as many games played as possible, the league decides to run double-headers which would severely limit the number of games in which a starting pitcher would participate. Pitching every fifth-day could mean every 7-10 games.
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Nick Markakis is not in a very good situation either. He appeared to be destined for a part-time role with the Braves in 2020 and is on a one-year deal for $4 million. Like Hamels, he’ll be 37 entering next season. You have to wonder if this is his last season.
Marcelo Ozuna was on a one-year, provide it deal similar to Josh Donaldson’s last season. Even if he proves it during a partial season, it may not garner the contract he set out to get in 2021. in a shortened-season scenario, one extended slump can wreck your stats and one hot streak could give teams pause when assessing final numbers. Those factors combined with a more shallow pocket-book does not bode well for guys looking to cash in next off-season.
It should be interesting to monitor the financial decisions being made. Will arbitration numbers accommodate the financial losses? Will that set the tone for free agency? Even if arbitration numbers were to remain the same, wouldn’t that in theory, eat into the potential free agent pool for each franchise?
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See, these are the things we start thinking about when we don’t have the luxury of waking up in the morning and wondering why Snit rolled out Mark Melancon three days in a row when he had Will Smith and Shane Greene with full stamina. Hopefully, we get back to our second-guessing and box score reading soon enough.