The Indians have signed shortstop Asdrubal Cabrera to a two year, $16.5M extension, covering 2013 and 2014, buying out Cabrera's final year of arbitration and one year of free agency. Cabrera, already signed at $4.55M for 2012, will now make $6.5M in 2013 and $10M in 2014. There are those scoffing at the extension, pointing out that Cabrera is highly unlikely to repeat the 25 home runs he hit last season. I agree that he will almost certainly fall short of that total, perhaps hitting less than half that many, but I disagree with the notion that failing to hit as many home runs means will necessarily make him much less valuable.
As evidence, I point to Cabrera's 2009 season, when he was almost exactly as valuable as in 2011 despite hitting just 6 home runs. Because Cabrera got so much more attention in 2011, that claim may seem hard to believe at first, but look at his WAR and WARP figures for those seasons:
WAR (Baseball-Reference version): 3.8 3.7
WAR (Fangraphs version): 3.2 3.6
WARP (from Baseball Prospectus): 3.3 2.7
average of the three: 3.43 3.43
As I said, Cabrera only hit 6 home runs in 2009, but he also hit 42 doubles, batted .308, had an OBP of .361, and an OPS of .799. Even including 2010 (when he missed two months with a fractured forearm), over the last three years, it's fair to say Cabrera has been the best hitting shortstop in the American League. If he were to split the differences between 2009 and 2011, Cabrera would have a line of .291/.347/.449, with 16 home runs. That's not to say those are the numbers he's going to put up, just that there's more than way to put up good numbers.
Cabrera was named a "Gold Glove Finalist" last year, but I'm not here to argue Cabrera is a great fielder. More advanced defensive measures have Cabrera as below average. But those are the metrics used in the metrics above that show Cabrera to have been worth ~3.5 wins above a replacement player. Someone providing that kind of value would be worth ~$15 a year on the open market. Cabrera wasn't on the open market and was under team control through 2013, so that number needs to be lowered some, but an average of $8.25M looks like a good signing to me.
Looking ahead, Cabrera will be turning 29 years old at the end of the extension. He'd still be in his prime, with another big contract ahead of him, should he continue to perform. If that's the case, the Indians are unlikely to be the team signing him to that big contract, as such contracts are a hard sell for teams in smaller MLB markets. However, the Cabrera contract has the added benefit of buying the time needed for Cleveland's top prospect, shortstop Francisco Lindor, to (hopefully) be big league ready; Lindor will be 21 years old in 2016.
Cabrera isn't going to hit 25 home runs again, but I expect him to be well above average for his position during the next three seasons, and this extension will work out for both sides.