There May be No Good Time to Trade Kris Letang
The Sidney Crosby-era Penguins have been branded as a contending team built around a generational core of players — Crosby, Evgeni Malkin, Kris Letang, Marc-Andre Fleury and James Neal.
That core is excessively talented. Always has been. Now, they’re becoming excessively expensive.
In the wake of the weekend’s organizational shakeup, in which the firing of GM Ray Shero is starting to feel like the first sight of an iceberg from a ship whose course is set, the question has become whether the incoming head of hockey ops will need to take away from that core in a meaningful way in order to fill out the rest of the roster.
Fleury has his detractors and there’s the obvious call to cut ties with the enigmatic James Neal, but no one is set to exert new pressures on the team’s salary structure like Letang.
Letang earned a mammoth contract extension from Shero and the Penguins following last year’s playoffs — eight years (league maximum for a player re-signing with his current club), $58 million and a new AAV (average annual value) of $7.25 million, making him one of the highest-paid defensemen in the NHL.
That deal more than doubles his take-home of the last few seasons and makes him the third-highest paid player on the team.
The Penguins have a number of high-salary players on the roster. Crosby and Malkin lead the way, with cap hits of $8.7 and $9.5 million, respectively. Malkin’s new contract pays him $800,000 more than his last over the course of eight years, a contract signed in the same summer as Letang’s.
Aside from those key pieces, three players are set to earn $5 million next season (Neal, Fleury, Paul Martin) and three more (Chris Kunitz, Pascal Dupuis, Rob Scuderi) are slated to earn more than $3.5 million in a season in which each player will be 35 or older.
As Elliotte Friedman of the CBC noted in his 30 Thoughts column, that’s an unusual (and perhaps untenable) salary structure.
“Letang and Malkin’s extensions — which kick in next season — will eat slightly more than $4 million of whatever jump there is from this year’s $64.3 million limit. Those three players could combine for 35 per cent of Pittsburgh’s space.
“Even as the cap rose from its initial $39 million in 2005-06 to almost double that now (with some teams predicting even higher numbers), you don’t see many situations with Pittsburgh’s upcoming structure.”
The thinking now holds that the Penguins became too happy with their post-Burkle power to spend to the limits of the salary cap, and the ability to field a quality roster down the line is going to necessitate a subtraction of the money that has been laid out to those players.
The Penguins, perhaps more than any team to have qualified for this postseason, lack depth. The team’s bottom-six was a black hole of possession, and has been for some time. That the team needed to break up a very good second line of Malkin, Neal and Jussi Jokinen just to give Crosby a productive right wing spoke to the team’s lack of talent up front.
Now, the Penguins will have to address that issue of depth in a season in which their expenses are set to increase at the same time that the NHL salary cap could hit an upper limit that is considerably lower than was anticipated when Malkin, Letang and the rest of those Penguins who are currently signed inked their latest deals.
Indeed, the Penguins are in a bit of a fix when it comes to the salary cap.
- To this point, the Penguins have committed more than $55 million to just 14 players. That’s nine players short of a 23-man roster, not to mention any depth options which will have to be placed in the AHL in order to not be counted against the cap on opening day.
- Depending on where the upcoming salary cap lands, the Pens could have as little as $14 million to account for those contracts, an average of $1.5 million per player. While some of that money will have to be accounted for by players within the system who are on entry-level deals, most of those players are defensemen. The team is thin at forward in the minors, and seven of the nine vacancies on the 23-man roster are at forward.
- Why is the salary cap going to be so low? An exchange rate fluctuation which has seen the Canadian dollar devalue against U.S. currencies has deflated the league’s revenues, no small thing in a league where three of the top-four earning clubs (and 7 out of a total 30) report their finances in Canadian dollars. As that fluctuation increases, the revenue against which the salary cap can be based takes a hit.
Given all that, the thinking now holds that the team should trade its high-cost players. The benefit is supposed to be two-fold — gain salary relief by moving those contracts off the books, and begin to replenish the farm system and address the team’s depth problems with the players/picks gained in return.
Of the players the Penguins currently have signed, no one offers the same measure of salary relief and trade value as Letang.
There is a problem inherent to this suggestion, and a big one. Letang’s trade value is not at its highest. Not right now. It could very well be that Letang’s trade value will be at its most depressed level this summer, when the Penguins are looking to deal and Letang is still coming off a season in which he missed more than half the team’s games due to a stroke and other injuries (in addition to a broken hand and broken foot suffered in the last two games of the playoffs).
If the Penguins’ new general manager is unable to fleece his trade partners in the same way Shero was — and make no mistake, Shero’s dismissal had much more to do with reckless contract extensions for aging players and a spotty draft record than with his ability to pull a fast one on opposing GMs — trading Letang could prove to be a monumental mistake.
And unless the Penguins move him soon, they may not be able to move him at all. Letang’s new contract extension carries with it a limited no-movement clause, in which he would annually submit a list of 12 teams to which he will not accept a trade.
It’s very likely that the list of acceptable targets will include contenders and teams within the Eastern Conference, perhaps even the Metropolitan Division. The Pens took such a risk in moving Jordan Staal to the Carolina Hurricanes (a team that has since become a division rival). Would they do it again with Letang?
If such a deal is to take place at all, Letang’s value will be higher at the trade deadline than during the offseason, or even during the coming NHL draft. GM’s tend to feel the external pressures for making a deal during the season, when the playoffs are in sight and expectations mount. In the offseason, the pressures for such deals don’t exist. It’s unlikely that the Sharks could have earned a pair of second-round draft picks for Douglas Murray in an offseason deal. That Shero managed to get as much as he did for Staal in an offseason trade speaks to the unique circumstances of that deal, and of Shero’s ability to get full value for his assets.
Those things won’t come into play, of course, if the Penguins deal Letang before his pending extension takes hold. But with his trade value so impressed upon by his injuries and inconsistent regular-season play, the Pens may be better off hanging on to their highly-paid defenseman.
Letang is not without his shortcomings. Injuries are a major concern, and Letang hasn’t shown the ability to elevate the play of a lesser defense partner. He has, however, shown to be a legitimate top-pairing skater. He and Martin formed an excellent top pair throughout the postseason, elimination notwithstanding. Letang also has a singular puck-moving ability that goes beyond making a good first pass out of the defensive zone.
With Martin playing what could be his last year in Pittsburgh in 2014-15 and Matt Niskanen almost certainly on his way out the door to free agent riches, Letang’s puck-moving and other offensive talents are going to be indispensable, even with the promotion of names like Olli Maatta, Derrick Pouliot and others.
And if his on-ice potential isn’t enough to convince the incoming Penguins GM to hang onto him, the realities of his trade value may force the new guy’s hand.
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