The difference in retail price verses production prices suggest otherwise.
It doesn't suggest anything, even if you had any clue what those prices were.
Which you clearly don't, since you are under the impression that Microsoft (or Sony!) adding significantly more storage out of the box wouldn't have been a big deal on their end and that they simply didn't do so to force people to buy an expansion.
Let's go over this step by step to help you out:
No it's not. It's about $20 more than a mid-grade Gen IV NVMe (presumably what the expansion card is if it matches the internal speed specs of the system) of the same capacity, but in a custom form factor (which adds costs) that has the benefit of being more consumer friendly than the normal design; with the top tier bare bare drives not on the market yet but promising to be the same price or more. The only way it will be a ridiculous price is if NVMe prices start collapsing and Microsoft does nothing about the price, but the former actually has to happen first and NVMe flash memory has been a very volatile (heh) market in price fluctuations compared to stuff where the drops are fairly linear like SD cards or flash drives. COVID hasn't helped that, and more and more things using more and more flash storage onboard hasn't either.
microsoft have definitely got a big money spinner there,
This isn't 20GB 360 hard drives circa 2008, so no, they don't.
1TB doesn’t go far and they know that,
So does Sony, whose even
more expensive internal storage solution forced them to include even less than a terabyte; and who will require top shelf Gen IV NVMe drives if you want to expand on PS4 storage that also will be several hundred dollars for the near future.
dont put a larger hdd in the machine,
Since the storage included in the system is most assuredly one of the most expensive individual components this console generation (for both systems) when that hadn't been true since the original Xbox, I'm perfectly capable of understanding why Microsoft (and Sony) didn't put a larger
SSD in the system even if it means people will run into a wall.
screw them over with expansion cards.
That horrible price gouging of around
$20. Those
bastards.
Anything else? Since you obviously didn't bother to check how much NVMes cost before you commented in this thread or when you doubled down on your first post when called on it, I can only once again insist that you actually
check how much decent NVMe SSDs cost before you go off about how much Microsoft is gouging people for selling a decent NVMe SSD in a custom enclosure specifically for the Xbox.