Hal Steinbrenner Calls Yankees' Payroll Unsustainable Amid Juan Soto Speculation

The Yankees' payroll is more than $300 million as Soto heads for free agency.

May 18, 2024; Bronx, New York, USA; New York Yankees right fielder Juan Soto (22) follows through on an RBI single during the second inning against the Chicago White Sox at Yankee Stadium. Mandatory Credit: Brad Penner-USA TODAY Sports / Brad Penner-USA TODAY Sports

Juan Soto has fit right in with the New York Yankees, opening the 2024 season as one of the best hitters in baseball. That start and Soto's fit in pinstripes has the team's fans dreaming on a future that includes the impending free agent.

Owner Hal Steinbrenner just threw a huge bucket of cold water on that dream.

Steinbrenner claimed the Yankees' current payroll is unsustainable, whether they re-sign Soto or not. The franchise is currently paying more than $300 million in total payroll, and speculation suggests Soto could seek a deal worth more than $500 million.

"I’m gonna be honest, payrolls at the levels we’re at right now are simply not sustainable for us financially,’’ Steinbrenner said Wednesday at the owners meetings about the payroll. “It wouldn’t be sustainable for the vast majority of ownership [groups], given the luxury tax we have to pay."

Steinbrenner was quick to note that not wanting to go above the $300 million mark doesn't mean the franchise can't afford Soto. Several contracts are scheduled to come off the books after this season. Gleyber Torres is currently making $14.2 million and will hit free agency, as will Alex Verdugo ($8.7 million), Clay Holmes ($6 million), Tommy Kahnle ($5.75 million) and Jonathan Loaisiga ($2.5 million). Anthony Rizzo also has a $17 million club option for 2025. The issue is, those salaries combined come to $54.15 million and all of those players need to be replaced somehow.

Soto is likely to take up more than $40 million by himself and the Yankees already have $202 million committed for 2025. The luxury tax threshold for next season is set at $241 million, and the Yankees will be a repeat offender, increasing their penalties. So you see the issue here.

There is virtually no chance the Yankees let Soto walk without a fight. The 25-year-old is one of the best hitters in baseball and has been excellent since joining the team. In 50 games, the right fielder is slashing .309/.408/.539 for an OPS of .947, with 11 home runs, 37 RBI and 2.2 WAR. He has also walked 33 times while only striking out 34. He has been everything they wanted and needed.

Steinbrenner might just be posturing about future payrolls. New York would be foolish not to go all-in to retain Soto.