We already knew based on previous reports that the Lakers had tried to trade for Kyle Lowry, that they’d had those talks fall apart because of their continuing refusal to include Talen Horton-Tucker in any deals, and that they made starting point guard Dennis Schröder available in those discussions and others.
A notable piece of news in the aftermath of the Thursday’s trade deadline, however, is the reason the Lakers were willing to part with their starting point guard: According to Jovan Buha and Bill Oram of The Athletic, it’s (partially) because Schröder and the Lakers are at an impasse in contract extension negotiations:
Sources said the sides remain far apart in extension negotiations, with Schröder, who is making $15.5 million in the final year of a four-year contract, seeking a multi-year extension that would pay him more than $20 million per year. That gap contributed to the Lakers’ willingness to include Schröder in trade talks.
Schröder has made it clear to reporters and on social media on multiple occasions that he would like to sign a contract extension with the Lakers, only repeating that he wants it to be “fair.” It would seem that so far, however, his definition of “fair” is different than what the Lakers’ is.
Still, there is some important context here. For one thing, Lowry is a better player than Schröder, or at least he has a strong argument as one, even if he is 35. If the Lakers felt good that his prime (or at least the tail end of it) will continue a little while longer, it makes sense that they’d be willing to go all-in for him. That’s not a slight to Schröder, it’s just an acknowledgment of reality, and one the Lakers may have been more willing to make if they aren’t confident that they can keep Schröder at a number they consider reasonable.
Additionally, if Schröder wants more than $20 million a year, the Lakers literally can’t give him that right now. As our own Sabreena Merchant covered earlier in her explainer on Schröder’s current contract situation from when he became eligible for a larger extension, the Lakers can currently offer him a maximum starting salary of $18.6 million, the total value of which would be approximately $83 million over four years (starting next season).
So if over $20 million annually is something Schröder wants in each year of his deal, he’ll have to wait until the offseason, when the Lakers will have his bird rights and can go over the cap to offer him up to the maximum salary for players of 7-9 years of experience: 30% of the cap, which would be $32 million this season.
DISCLAIMER: I feel comfortable saying there is absolutely zero chance the Lakers will offer Schröder the full max, but that is just to illustrate that they can in theory offer more in the summer than they can right now, giving them more wiggle room in negotiations than exists currently.
If the Lakers were willing to trade Schröder over this, though, it seems safe to say that they are not 100% confident that they can reach a deal. While that wouldn’t be the end of the world because they gave up some ridiculous haul for him — a late first-round pick and Danny Green’s contract isn’t exactly a killer package — it is an issue because the Lakers will have no good way to replace him if he leaves as an unrestricted free agent. As previously mentioned, they project to be over the cap this summer, and so while they can offer Schröder more than any other team, they wouldn’t have nearly that level of money to offer a theoretical replacement.
That last part might be why Schröder is comfortable waiting and trying to get more. The Lakers can say “you’re not worth that much” but he can say “I am, to you.” It’s a higher-class version of the Kentavious Caldwell-Pope situation they faced in free agency last offseason.
The problem for the Lakers is that Schröder will also cost them more than just about any other team. The Lakers are currently set to potentially pay upwards of $100 million just in luxury tax payments if they try to keep the majority of this roster together in the offseason, meaning that every dollar they pay Schröder will cost them even more in taxes. No one is going to cry for Lakers governor Jeanie Buss — and she’s said she’s willing to pay to keep this team a contender — but it’s not hard to envision the Lakers wanting a bit of a discount somewhere, whether in years or annual salary, under these circumstances.
Going forward, these negotiations are certainly something to monitor. Schröder doesn’t appear to have let the situation affect him on the court at all, but sometimes these things can bubble over. Hopefully that doesn’t happen, but as the Lakers dangling their offseason prize in midseason trade talks illustrates, this is certainly a more tenuous situation heading towards the summer than anyone expected even a few months ago.