The 27-year-old confirmed he is aware of Yamaha's plans to sign Espargaro, runner-up to Marc Marquez in last year's Moto2 championship, to a factory contract.
Works riders Jorge Lorenzo and Valentino Rossi, and Tech 3 team-mate Bradley Smith, all have contracts with the Japanese manufacturer, but Crutchlow only has a one-year deal.
"As far as I am concerned and aware Pol is very close or has signed for Yamaha," he told AUTOSPORT.
"That puts him in the Tech 3 team, because the other two and Bradley have a contract. There's nothing to say about it, that's just the way it is.
"Would he [Espargaro] beat me? No.
"Seems to everybody [a barmy decision]....they think he's going to be the same as Marquez and he isn't, Marquez is a one-off.
"Everybody thinks the next guy up is going to be as good as Marquez, but Marquez is like Valentino was 15 years ago; he is unbelievable. Pol is not going to beat Marquez.
"At the end of the day I don't know why the decision has been made, but that's Yamaha and Lin Jarvis's decision and I'll leave it up to them."
Crutchlow said he would be looking to move at the end of the season anyway, with a factory ride his main objective.
Asked if he could do any more to earn a factory ride, he said: "I'm top satellite bike, so no. It's down to the manufacturers to decide.
"At the end of the year maybe there's somewhere we can go, but we'll look at that as and when. At the moment my concentration is to finish the races as high up as possible and hopefully things will happen from there.
"I don't want to ride for a non-factory team anyway.
"If a decision needs to be made, it needs to be that I'll be on a factory bike in my team. If not, then there's no point in me riding around in the same position as last year."
Asked if that meant he could switch disciplines, Crutchlow added: "Maybe. If that's what needs to happen then yeah."
Alternatively a factory ride could open up should Ducati not extend Nicky Hayden's current deal - which runs to 2013 – or should new manufacturers like Suzuki join the series.
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