Last season, the Detroit Tigers finished 74-88, last in the AL Central, in large part due to their disastrous pitching. The Tigers' 4.90 team ERA in '08 was the fourth worst in the major leagues.
Detroit's hyped lineup was good, but it didn’t produce the galactic numbers that a lot of people expected. The Tigers may be facing some difficult financial decisions if their disappointing play continues.
The Tigers were top three in player spending in 2008, along with the Yankees and Mets. They spent about $138 million.
The Tigers players’ salaries are projected to be about $135 million for 2009.
From Peter Gammons’ blog:
"Major League Baseball has warned club businesspeople that attendance is expected to be down 17-20 percent in 2009, and that it could be worse, especially for franchises such as the San Diego Padres, Toronto Blue Jays, Detroit Tigers, Cleveland Indians, Houston Astros, Colorado Rockies, and others that could be seriously impacted by the recession."
So far, Gammons’ report is looking like fact.
For Detroit, opening ticket sales are down almost two-thirds from last year:
2008: 177,180
2009: 66,163
Last year, before the 2008 season, the Anderson Economic Group predicted that the Detroit Tigers would sell an average of 40,000 seats per game.
Along with a big opening day, the team was projected to have a total economic impact of $117 million.
The basics of their prediction
$22.50 average cost per ticket
+ $20 additional expenditures (food, drinks, etc)
+ $5 Parking
= $47.50 per person cost of attending a ballgame
40,000 tickets per game
$47.50 * 40,000 tickets = $1,900,000 total expenditures
Direct economic impact: $905,000 (Subtracting MLB share and substitution effect)
Indirect economic impact: $543,000 (multiplier of 0.6)
Total impact per game: $1,448,000
Impact over 81 home games: $117,288,000
Season revenue from ballgames: $73,305,000
Attendance for the Tigers was actually closer to 39,000 per game, but this estimation was close.
What impact would cutting attendance by 20 percent have?
31,200 tickets per game
$47.50 * 31,200 tickets = $1,482,000 total expenditures
Direct Impact: $705,900
Indirect Impact: $423,540
Total impact per game: $1,129,440
Impact over 81 home games: $91,500,000
Season revenue from ballgames: $57,200,000
What about a 30 percent attendance decrease?
27,300 tickets per game
$47.50 * 27,300= $1,296,700 total expenditures
Direct impact: $617,663
Indirect Impact: $370,597
Total impact per game: $988,260
Impact over 81 home games: $80,049,060
Season revenue from ballgames: $50,030,703
So the Tigers could be looking at a decrease in total economic impact of at least $25-37 million, and revenue from ballgames could drop by at least $16-23 million.
Let’s take a look some of the big remaining contracts that Tigers GM Dave Dombrowski so generously doled out.
M. Ordonez: $16M, one year
G. Sheffield: $13M, one year
J. Bonderman: $25M, two years
C. Guillen: $36M, three years
Dontrelle Willis: $22M, two years
N. Robertson: $17M, two years
Brandon Inge: $13M, two years
C. Granderson: $17M, four years
The Detroit Tigers failed to move the contracts of Gary Sheffield and Magglio Ordonez over the offseason. It’s possible that some team will trade for Ordonez midseason, but that seems unlikely.
In fact, the Tigers need to make sure that Magglio doesn’t reach 135 starts or 540 plate appearances, or his 2010 money becomes guaranteed.
Bonderman (career 4.74 ERA), Willis (absolute disaster), and Robertson (career 4.90 ERA) aren’t attractive trade candidates with those salaries.
Carlos Guillen’s contract seems astronomical in the current market.
Granderson is a fan favorite and a relative bargain, so he is probably staying put in Detroit.
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