Pettitte and Lowe

Earlier today, we took a look at the potential super-rotation the New York Yankees may feature next year. They already signed CC Sabathia to a monster deal and are considered the front-runners for both A.J. Burnett and Derek Lowe. With Mike Mussina retiring, and Andy Pettitte’s uncertainty, the aforementioned three would join forces with Chien-Ming Wang and Joba Chamberlain to improve the rotation by approximately six full wins above replacement.

Brian Cashman left the Winter Meetings today to fly to Texas, in order to make a final offer to Andy Pettitte. The one-year offer is believed to be worth $10 mil, a paycut from Pettitte’s $16 mil salary in 2008. While Andy has not discussed wanting more than his fee last season, he has made it clear that he does not want to take a paycut. Cashman said that the offer for Pettitte would be to claim the final spot in the starting rotation. Assuming that the decision here is between Lowe and Pettitte, let’s weigh the pros and cons.

First off, what are their true talent level projections for 2009? Marcel forecasts Lowe to produce a 3.67 FIP in 185 IP. I would bump that up to around 3.80 given that he is going from the NL to the AL, so we can call him a 3.80 FIP pitcher in 185 IP. Compared to the replacement level, with a slight reward for pitching all those innings himself, and not allowing a poor reliever to enter, those numbers translate to +35 runs, +3.5 WAR.

Pettitte is projected to log 182 innings, with a 3.98 FIP. To make the comparison a bit easier, let’s bump him up to 185 IP, the same figure as Lowe, with a 4.00 FIP. Factoring in the same replacement level and slight reward, Pettitte in 2009 comes out to +31 runs, +3.1 WAR.

Therefore, Lowe is worth a bit under a half-win better than Pettitte based on their true talent levels. The fair market value for each, assuming $4.8 mil/win, would be $16.8 mil for Lowe and $14.9 mil for Pettitte. Replacing Lowe with Pettitte in the super-rotation will cost them 0.4 wins, meaning they would be worth +19.4 wins as opposed to +13.8 in 2008. This is still a substantial improvement, meaning the differences between Pettitte and Lowe are not that significant.

In terms of salary, however, it isn’t likely that either will earn their fair market value. As I mentioned earlier, Pettitte is being offered a take-it-or-leave-it, 1-yr/$10 mil deal. With a 10% discount rate factored in for the security of a long-term deal, Lowe would sign for 3-yrs/45 mil, or 4-yrs/60 mil. Therefore, that extra half-win of Lowe’s value would cost around $5 mil.

As commenter Steve Sanders pointed out, though, signing Pettitte instead of Lowe would give Cashman greater flexibility in the future. Pettitte would sign for a 1-yr deal, be an above average pitcher less than a half of a win worse than Lowe, and after this season, come off the books, freeing up more money to be spent elsewhere. In the past, Cashman would sign a plethora of players to multi-year deals, hamstringing himself in the process.

With Lowe, if we assume a dropoff of 0.35 wins per year, over the course of a 3-yr deal, he would go from 3.50 to 3.15 in 2010, to 2.80 in 2011. Perhaps the contention of those fans in favor of bringing back Pettitte for the 1-yr deal as opposed to signing Lowe is that they will get similar value in 2009, and be able to avoid paying $15 mil to a 2.80 win player in 2011, when some of their prospects may be ready for full-time rotation duty.

What say you, Yanks fans? Do you want Pettitte back for one year, or Lowe for a few years?