[Jaygles]

In this example aren’t the two engines equally capable, with one being held back artificially?

I think what the other commenter is getting at, is that if the manufacturer puts a 300hp engine in a car but limits it to 250hp, they still need to charge enough to make a profit. If the manufacturer produced a cheaper 250hp engine for the 250hp car, they could probably charge less for the same profit.

So it’s a double loss for the consumer of the 250hp car. They pay a higher cost and are artificially kept from the full performance of what they bought

[RaftPeople]

Understood your thinking and we don't know if that is the case or not, I can see a few different ways they could have handled it:

1-As you stated, full extra cost is paid by the buyer regardless of opting for extra capability, and that cost is non-trivial

2-Same as #1 but the cost is trivial due to some internal mfg conditions we are unaware of

3-Extra cost is non-trivial and is prorated across all units based on the expected rate of purchasing the extra capability and the overall revenue vs costs. So in this case it's a partial increase.

3-Extra cost is non-trivial but the buyer does not pay more than if they had used the less powerful engine, the buyers of extra capability are expected to fully fund the cost increase to the entire group of vehicles in the program. This could still be competitive with the market for the extra capability because people can pick and choose when they want to spend the money, that flexibility has value.

We don't really know how they handled the situation but I would be surprised if it was #1 because it would make the car less competitive for buyers that don't want the extra capability.