Shohei Ohtani’s groundbreaking 10-year, $700 million contract with the Los Angeles Dodgers was not only the largest in professional sports history but also a testament to his strategic approach to career longevity and team success.
According to his agent, Nez Balelo, Ohtani had opportunities to sign a 15-year deal, but chose a shorter term to maintain his performance standards and avoid potential decline in the latter years of his career.
“We could have gone to 13, 14, 15 years,” Balelo revealed at Sportico’s Invest West conference. “But Shohei wanted to always kind of keep the integrity of where he’s at as a player. He just didn’t want to have the end of his storybook career tail off.”
Innovative Contract Structure
Ohtani’s contract includes an unprecedented $680 million in deferred payments, significantly reducing the present-day value of the deal for luxury tax calculations. This structure allows the Dodgers greater financial flexibility to build a competitive roster around Ohtani.
The deferred payments will be disbursed between 2034 and 2043, with Ohtani receiving $68 million annually during that period.
This arrangement was Ohtani’s idea, motivated by his desire to help the Dodgers sign other players and build a championship-caliber team. His substantial off-the-field earnings, estimated at over $45 million annually through endorsements, made this financial strategy feasible.
“We just have to make sure that we don’t overexpose him or put him in a situation where it’s too heavy of a lift,” Balelo said.
Balancing Legacy and Team Success
Ohtani’s decision to prioritize a shorter contract term reflects his commitment to maintaining peak performance and contributing meaningfully throughout the duration of his deal.
“They’re playing by the rules,” Arizona Diamondbacks owner Ken Kendrick said. “They got a great player, who is going to be an addition that makes them more competitive.”
“But the economics are not so tilted in a way that puts them at an incredible advantage over the rest of us.”
By avoiding a longer-term contract that could extend into his mid-40s, Ohtani aims to prevent a potential decline in his skills and preserve his legacy as one of baseball’s most exceptional talents.
In his first season with the Dodgers, Ohtani’s impact was immediate, contributing to the team’s success and securing his first World Series title.
His strategic approach to contract negotiations and team-building has set a new precedent for elite athletes, emphasizing the importance of balancing personal performance, financial considerations, and team success.
Implications for Future Contract Negotiations
Ohtani’s innovative contract structure and emphasis on team flexibility may influence future negotiations in professional sports.
By deferring a significant portion of his salary, he has demonstrated a commitment to team-building and long-term success, potentially inspiring other athletes to consider similar approaches in their contract discussions.
“We wouldn’t do anything different,” Balelo said. “He won a championship. He went to the right team. No regrets.”
Looking ahead, Ohtani’s ability to resume pitching—expected in 2025 following his second Tommy John surgery—will only further solidify the value of this contract.
If he returns to form on the mound while maintaining his elite offensive output, the Dodgers will be benefiting from one of the most efficient investments in modern sports history.
And if this experiment in high-value, deferred structuring proves successful, don’t be surprised if other high-profile athletes follow suit—shifting contract culture in baseball for years to come.
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