What Bo Horvat’s new contract means for the Red Wings and Dylan Larkin

Some of Lou Lamoriello’s first comments on the eight-year contract he signed Bo Horvat to on Sunday — reportedly worth $8.5 million annually — were extremely telling: “It’s too long, and it’s too much money,” Lamoriello told reporters.

Welcome to the world of center contracts in 2023 — and for Steve Yzerman and the Red Wings, welcome another important data point in the Dylan Larkin negotiation.

Funny enough, Lamoriello is the same general manager who signed the other most recent comparable for Larkin, when he gave Mathew Barzal eight years at $9.15 million back in October. And while the circumstances of the Horvat contract are a bit different (the Islanders had just made a significant trade to add Horvat), it nonetheless bears weight on what has been a slower negotiation than hoped between Detroit and its captain.

With just five months until his contract expires — and a matter of weeks before the NHL’s March 3 trade deadline — the Red Wings and Larkin still have not agreed to an extension and do not appear close. It’s been a grinding process on a deal that is expected to land somewhere between $8 and $9 million annually — a relatively narrow range in the grand scheme of things, but one with real stakes on both sides.

Horvat’s deal landing in the middle of that range, then, jumps out right away. Horvat is in the midst of a well-timed career year, but this deal — as well as Lamoriello’s apparent hangups even while signing it — is reflective of a center market that has fundamentally changed from past years. That’s been clear in the number of young centers approaching (and surpassing) $8 million as restricted free agents, and it’s even more clear in the average annual value (AAV) veterans are pulling in (or ahead of) unrestricted free agency.

Frankly, it’s easy to understand why some general managers are squeamish about that — the salary cap has made every dollar of paramount importance to teams, and the NHL’s has been flat for years. The cap is expected to rise considerably in the coming seasons, which is likely contributing to these rising contract figures, but managers could be forgiven for being a bit gun-shy after the last few years of stagnation.

The fact Lamoriello signed this Horvat contract anyway, though — in spite of thinking it was too long, and too much money — is telling about the reality of the market: If you don’t pay it, all recent indications are that someone else will.

In the abstract, Horvat signing for $8.5 million should re-enforce that Larkin’s value is higher than that number. While Horvat is having an outstanding platform year, on pace for a 50-goal season, his career points-per-game average (.68) is below Larkin’s (.73). Horvat’s goal-scoring rate is a bit higher (.32 to .29) which is relevant in contract talks, but Larkin is also considered to be the better defensive player.

They’re not too far off, all told, but Larkin’s overall resume is just a bit stronger, and he’s a year younger. If this were an arbitration case, then, you’d expect Larkin to land somewhere above Horvat’s $8.5 million.

But this deal will not be decided in arbitration. And while Lamoriello saw a deal he was uncomfortable with and decided he had to sign it anyway, Yzerman may well decide the opposite.

He seemed prepared to in 2016, for example, when he waited out his captain in Tampa Bay, Steven Stamkos, until Stamkos signed an eight-year, $68 million deal just days before free agency. That AAV, by the way, is identical to Horvat’s new one — a clear look at how the center market has evolved in that seven-year period.

In 2018, just months before Yzerman left the Lightning to become the Red Wings GM, Stamkos told me part of the culture Yzerman built in Tampa centered around the idea that “if you want to keep a good team together, guys are going to have to make little sacrifices along the way, whether that’s in terms of money or term or ice time or role on the team. That was something that — it’s kind of non-negotiable on this team, in terms of doing whatever it takes to help us keep the core together and keep being a productive team.”

The two circumstances are not a perfect overlap — the Lightning were coming off back-to-back deep playoff runs at the time of Stamkos’ negotiation, for example, while the Red Wings haven’t made the playoffs since 2016. But if you’re trying to understand the hold-up in the Larkin negotiations, Stamkos’ words from nearly five years ago offer great insight into Detroit’s GM’s approach.

The phrase “non-negotiable” is probably not meant to be taken completely literally in an actual negotiation — but if Yzerman does indeed have a line in the sand, toward the low end of the $8 million range, then perhaps it really is that simple for him.

The Red Wings can offer Larkin the eighth year that no other team could give him in free agency — and that holds real value which should not be underrated. Even a seven-year deal matching Barzal’s $9.15 million AAV on the open market would only equate to $8 million annually on an eight-year contract in Detroit — though Barzal and Horvat did get eight-year terms on those deals.

Other than that, though, Detroit’s main leverage is that Larkin wants to be a Red Wing, which he has made clear in every public comment about the talks. And while Yzerman has not taken questions from media this season, it’s fair to believe he wants the same — even just by the fact he did not trade Larkin before his full no-trade clause kicked in this summer.

But as the clock ticks, with another comparable now out there, the questions have become quite simple. Detroit seems to be functionally asking Larkin just how bad he wants to stay. And they must also be asking themselves what they would do without him.

The Red Wings would save some cap space by letting Larkin walk as a free agent, and could certainly recoup some value in a trade — if, that is, Larkin was willing to give up one of his best negotiating chips and waive his no-trade clause. But either way, Detroit would still have to then replace him in a center market that is clearly beyond its comfort zone.

Lamoriello looked at a similar situation Sunday and decided to sign on the dotted line.

Yzerman may be more willing to hold his position — potential consequences be damned — just as he has in the past.

And in that sense, while the Horvat deal certainly provides a big new data point, the question for Larkin and the Red Wings is the same as it ever was: Who’s more willing to move?

(Top photo of Dylan Larkin: Gregory Shamus / Getty Images)