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I think the bigger problem is that it's a subscription and not a one-time purchase; paying more for more power has always been a thing, and sometimes it's a trivial difference. E.g. old Detroit Diesels could be easily upgraded substantially in power with bigger volume fuel injectors, and the various sizes are just a small machining difference.

TFA says you can pay $760 once instead of a subscription.

Common in ICE cars oo, mostly turbo ones. The difference between the 100HP model and the 120HP model is only an ECU map.

Typically ICE cars will offer variants of the "same" motor with different cams or pistons or even cylinder heads for the higher hp models alongside that better tune though.

They might be happy with $700 up front. However, I suspect they really want you to sign up for $200/yr and forget about it, even if you move to a place where you can't use the extra HP. They also want the opportunity to make money from the person you privately sell your car to.