Atlanta United’s Margin Call

If you’re an Atlanta United fan who is blissfully unaware about the state of the team over the offseason, and have returned from hibernation to the news of Josef Martinez’s trade buyout(!), you might be wondering “what the hell is going on over there? I mean, I know he hasn’t been the same since his injury, but cmon.”

While many will empathize with the feeling that it’s all a bit pitiful the way Josef’s move came about, the truth is that 1) it was a step in the right direction for a club looking to build medium/long-term success, and 2) moving Josef became necessary not only due to his own contract, but the acquisition of several other players that clogged the pipeline. Let’s break down that latter point first so that we can start to understand the former.

(Note: I’m going to keep this as simplified as possible, using rough estimates and a paraphrased version of MLS roster rules so as not to get bogged down in minutiae.)

If you’re here on Dirty South Soccer, you surely know the Designated Player rule — that teams may have up to three players who don’t count against the Salary Budget (or salary cap). These are obviously hugely important roster slots and it’s clear that post-injury Josef was not performing to that standard. It’s the reason why even Miami (who acquired him) was only willing to book him as a max-TAM player (paying him the most amount of money possible without surpassing the DP threshold). But even with Josef’s performance being what it is, Atlanta United may not have needed to make the unsavory move of straight-up cutting their most marketable star player if not for other contracts piled up on the roster.

Atlanta United’s front office, led by Vice President Carlos Bocanegra, can’t be faulted for failing to attempt to add quality players to the roster. Perhaps they can be faulted for the opposite — going all in and making every contract manipulation possible to load up as heavily as possible to keep the team an MLS contender. The result, after a season of brutal injuries that facilitated yet another terribly disappointing year, was a team with no financial resources heading into the 22-23 offseason. It was so bad, it seems as if they couldn’t even sign Amar Sejdic — a low-mid level salary player in MLS — before they first moved some high earners out.

Photo by James Williamson – AMA/Getty Images

Alan Franco, Marcelino Moreno, Erik Lopez (who many Atlanta United fans probably couldn’t pick out of a lineup) and Ezequiel Barco highlight the list of high-earning players who have not provided on-field value equivalent to their book value. And this is for various reasons. Alan Franco and Marcelino Moreno are not bad players — both were wanted by teams in Brazil’s top flight league, and we’ve seen them produce good, even if inconsistent, performances for Atlanta United. But both were on substantial salaries where, if you just look at the list, you easily recognize they require considerable TAM to pay them. But those salary figures don’t come close to accounting for the true cost, which includes the transfer outlay spent on those players amortized over their contract. Franco was roughly a $3 million deal and Moreno has been reported as high as $6 million. So, in Moreno’s case, if he signed a 5-year contract (just as an example) when he joined in 2020, that would be $1.2 million per year on top of his ~$550k salary (using the 2022 figure — it’s been higher in previous seasons). You could do a similar equation for Franco.

In 2022, teams received $2.8 million in TAM. So even just using this napkin paper math, we can see that Atlanta United was spending the vast majority of its TAM on two players. That’s not a mistake in and of itself — if a player performs at a high level like, say, Gareth Bale did for LAFC last year, it can be worth such a cost. But these players did not provide that value — not even close if we’re honest.

Barco and Lopez are slightly different cases. Barco was a Designated Player with no chance to be bought down (unlike Moreno, who was initially brought in on a DP deal, but was just cheap enough to be brought down off that designation). The Lopez deal was it’s own clusterf***. Lopez was signed during the Pandemic Summer with an idea that he would be designated as part of MLS’s new U-22 Initiative. But the initiative was delayed, Lopez lost that entire season as a player, he unsurprisingly then struggled to play well in 2021 and is now in loan purgatory to keep him off Atlanta’s MLS salary budget.

Yikes. I said I wasn’t going to get bogged down in minute details…

But hopefully now you can see why getting rid of some of these big contracts are going to help Atlanta United and return them resources going forward. Some of those resources may not be able to be utilized until this summer or even next year. That’s part of the pain, but it’s necessary.

In order to jump, you have to crouch a bit. You have to go lower and store energy before you can rise. You have to build up your power meter before you can use your special move. You have to pull the arrow back before it can fly forward. For too long, Atlanta United has been trying to propel its arrows with brute force — pushing them from the bow. Maybe it shouldn’t be a surprise that those arrows have been impotent in action.

Source: https://www.dirtysouthsoccer.com/2023/1/23/23567602/atlanta-uniteds-margin-call

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