What new Leon Draisaitl contract means to the Oilers - 7 takeaways

I'll save you the actual announcement of the Leon Draisaitl signing, because it's been rehashed to death already on every website and sports-themed TV show and radio broadcast already, including us.

Thus, I will assume you've heard it already and spare you the actual news item. Instead, let's focus on what Draisaitl re-signing with the Oilers means for the landscape of hockey here in Edmonton and to a lesser extent Alberta and Canada.

1. Daryl Katz is for real as an owner

After you come up with the liquid cash to buy an NHL team and have been approved by the league and the paperwork is done, the job of an NHL team's owner is, for the most part, to fade into the background until there's an announcement to the club that's so major it requires your attention.

History has shown us time and time again, that once the initial transaction is complete, then an NHL team's owner really only has three duties to his/her name - 1) Make sure your team has the resources to compete for a Stanley Cup 2) Hire good hockey people to run your franchise and 3) Get out of their way. Darryl Katz has taken this to heart. He has the deep pockets this team needs to compete in the modern NHL. He had the vision to see what a golden touch Pat Laforge had as CEO, and thus didn't replace him when he bought the team in 2008, until 2014 when Laforge was nearing retirement and thus a succession plan was necessary. At which time Katz forked out millions of dollars to bring Hockey Canada boss Bob Nicholson into the fold (Laforge would retire in 2015 in what at the time was a sort of unofficial demotion the previous year as COO).

Then, when Nicholson wanted to step away from the spotlight, and wanting to keep his #1 star in Connor McDavid happy, Katz had the vision to hire Jeff Jackson as replacement last year (Nicholson has since stepped down to an advisory role). Katz has been such a good owner of the Oilers over the past 16 years that the Oilers, who in the late 90s were right on the cusp of moving just like the Winnipeg Jets (1.0) and Quebec Nordiques did, now as of 2023 rank as the seventh most valuable franchise in the NHL according to Forbes magazine. Further, they are in fact second (!) in the entire league in operating income - only the Maple Laffs generate more and then it's only $127 million vs. $122 million, that's it.

Think about that for a minute. The Oilers are actually one of the smallest markets in the league in terms of population to draw revenue from, and yet they produce more operating income than everywhere else except for Toronto, a city whose Metro population is over six million people, which is six times the size of Edmonton.

The city of New York has eight times the population of Edmonton, and yet the Islanders and Rangers COMBINED make less operating income than the Oilers! That's $99 million vs $122 million, in case you're wondering. They have the Canucks beat by more than double, despite the fact Vancouver has almost three times the population Edmonton does. The Panthers, the Oilers' opponents in last season's Cup Final, made a mere $6 million in operating income in 2023 - and they also went to the Cup Final that year. Chicago has three times the population Edmonton has, yet the Oilers made almost $30 million more than the Hawks did in 2023. Even Montreal, long considered Canada's hockey mecca, with a population almost double Edmonton's, made $23 million less than the Oilers did. The L.A. Kings, the highest valued of the California teams, has a population almost four times that of Edmonton, yet the Kings finished below the Oilers in 2023 operating income by $14 million - and they're the only other team in the league over $100 million besides the Oilers and Leafs.

Gone are the days of Peter Pocklington, a shyster of a businessman who literally burned all his bridges in the local business community, to the point where he was taking his Oilers profits and using the majority of them to prop up the rest of his failing business empire. This resulted in the dismantling of the 80s dynasty, because Pocklington took too much money out of the Oilers coffers and was unable to keep up with the escalating salaries of the day. Gone also are the days of the EIG, whose mandate was simply to survive until a salary cap was brought in. Gone are the days of 90s stars like Doug Weight, Bill Guerin, Curtis Joseph, Janne Niinimaa, Dave Manson and more being forced to be traded, because the Oilers couldn't afford to pay them past a certain point.

With Katz at the helm, the Oilers no longer have to worry about losing McDavid and Draisaitl, unless they want to play somewhere else. The same thing goes for the supporting cast like Zach Hyman, Evan Bouchard, Mattias Ekholm, and the rest. Now the Oilers get to enjoy what clubs like the Rangers, Stars, Avalanche, and others have enjoyed for decades now - getting star players and keeping them, ensuring a competitive team for many years to come.

2. Edmonton is now a destination for players

This is down to a combination of the state of the art rink they play in and the dressing room they use, the (usually) respectful nature of the fans when players are out in the city in public, the lower cost of living relative to other NHL cities, the supportive nature of their owner, and of course McDavid. Add in the city's thriving arts and restaurant scenes and list of many attractions, and the Oilers are a destination team, which will only intensify with the Cup run completed this past June.

The same thing goes for Draisaitl - between McDavid, the great rink, and the fact that he's happy here, what possible reason would there be to leave? Anyone suggesting Draisaitl leaving was his first instinct clearly wasn't paying attention to the post-pandemic cap situation - any other NHL destination that was a cup contender didn't have the cap space for him, and any franchise that did have the cup space is a losing team that won't win a cup for a long time. Draisaitl would never get the sort of perks he gets in Edmonton anywhere else.

Edmonton may not have the weather of California or the energy of New York City/Toronto, or the culture of Montreal to draw players, but in terms of day to day life, NHL players have it pretty good here. Compare traffic from LA, Toronto, Montreal, Vancouver, or New York City to Edmonton, for example, and it's no contest. Edmonton has all of them beat. Same thing when it comes to buying a house - you can get a much bigger house in Edmonton for what you'd pay in New York.

It also helps that Edmonton is an experimental retail hub for all of Canada - any stores, especially US brands, that are trying to make their way in the Canadian market will oftentimes open up in Edmonton first. This brings players who are American transplants one step closer to feeling like they're home.

Most of all, the Oilers are now a winning team and a Cup contender - and Draisaitl is a huge part of that. Who wouldn't want to come play on the team with the two best players in the league steering the ship? Try everyone.

5. Believe it or not, Draisaitl still left money on the table

In negotiations with a superstar, the team has no leverage at all and they know it. If the superstar wants to leave, there is nothing they can do about it if they can't trade him before the contract expires. Fortunately for the Oilers, in the case of Draisaitl he wanted to stay in Edmonton, and thus his agent negotiated in good faith with the team, prompting Bowman to do the same. At the same time, Draisaitl allegedly could've gotten another $3.7 million a season. The maximum player cap hit for this upcoming season is $17.6 million. Since his cap hit is $14 million, that means he left money on the table, to allow Bowman a little flexibility to help build a prime supporting cast, since hockey is a team sport after all.

The beauty of this is Draisaitl still gets to make a name for himself as the NHL's (temporarily) highest paid player, both on the Oilers and in the league, so he sets a new record in that regard. So, this deal is not only good for Draisaitl, but it's good for the Oilers. Bowman knows this just as well as Draisaitl.

Any idiot who says Draisaitl is overpaid - and there are always a few - should have their head examined to see if a brain is even present at all. He's one of the best, so you pay him like he's the best. Period. No Wayne Gretzky trade v 2.0 happening here.

6. The Oilers just extended their window to win

Losing Draisaitl would've been a huge blow to the Oilers forward corps. They probably would've had to replace him with either Ryan Nugent-Hopkins or Adam Henrique, and while both are fine players, neither is as electric as the Deutschland Dangler. By doing this deal the Oilers ensure their top six forwards are an unstoppable train for many years to come. Once he locks up Bouchard and McDavid in the next couple of seasons, Bowman will have a fantastic core that will keep the Oilers competitive for years to come. After that, he'll only have to be concerned with the Oilers' cap situation and doing what the GMs of Vegas and Toronto have been doing for years - wheeling and dealing to stay cap compliant. That might be salary dump style trades or simply trading for a cheaper player or swapping a veteran for a young player.

7. The contract will be a cap headache short-term, but a bargain at its mid-point

A good parallel for this would be the contracts of Sidney Crosby and Evgeni Malkin in Pittsburgh. Malkin was drafted in 2004 while Crosby was drafted in 2005. When both players were due their big boy contracts after their ELCs were up, NHL salaries were in a much different place as the salary cap had just been instituted a few years earlier. Both guys signed what at the time were landmark deals of $8.7 million per season. The Pens won a few cups during both players' primes but still had to lose a good chunk of their supporting cast in exchange for cheaper players.

Bowman will have to do the same thing now with the Oilers. After McDavid and Bouchard re-up for big $$ - and they will, guaranteed, especially after Draisaitl as the first domino has - some hard decisions will have to be made. Every cap team has had to do it. Pittsburgh, Chicago, Los Angeles, and Vegas in recent years all had to say goodbye to certain players because they just couldn't fit them into the cap anymore.

That being said, after some short-term pain, this contract will begin to look like a bargain as the NHL's salary cap has just this past season recovered from the whole escrow deal the NHLPA made with the NHL prior to the pandemic.

So, the silver lining in this is with the Oilers locking up their core players at the same rates for years on end, it will give them more cap space to surround the core with great support, as the cap ceiling is going to up by $4-5 million per season at least for the foreseeable future. Until then they're going to have to do what every successful team has had to do. In other words, make some hard decisions and make sure that those guys' replacements are able to replicate their predecessors' success for the sake of the team. Just like Crosby and Malkin's current cap hits look like a bargain in today's NHL.

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