A significant component of the price gap is indeed subsidy. It would be foolish to say otherwise. It's $4700 of a $9000 price gap and thats not nothing.

Delaying payment to suppliers is a dog act. Thats no way to build business. I don't like it but I also don't see how that contributes anything like as much to the bottom line price, over time the cashflow still has to happen.

Forgive me if I allege sharp practices in Telstra, but I am forced to ask if there is some game going on with the IPR, and cost of things like the software stack. It's entirely possible that payments to that component are being used as a financial trick in a carmaker version of "hollywood accounting" to keep the business from having to e.g. pay out Panasonic on the cost of battery building, or some other partner. These things can happen in any industry.

But putting that to one side, It's just possible the gap here is Chinese labour cost and not much else: China can do this at scale, for a lot longer, and doesn't have to deal with the UAW or the German unions (I am by the way, pro union and this isn't meant to imply the unions are wrong to stand their ground) -Except that the cost of construction of a Tesla inside China is higher than the cost of a BYD constructed inside China. So.. I don't entirely understand this gap.

I'm forced to conclude Tesla doesn't want to compete on price and would prefer a higher per-car profit, than to achieve the volume of sales.

Fairly obvious isn't it? Middlemen, then almost-slavery.