When someone takes your factory and materials and electricity, you don't have them any more.

You missed his argument. What is it when someone steals his (extremely cheap to produce) goods?

It's theft but extremely cheap is not the same as free.

When someone takes his goods, he doesn't have them any more.

It's not like he was trying to collect them, he was trying to sell them. This person took them without paying.

What if someone figures out how to make a similar factory very cheaply, and drives you out of business by only charging their marginal production costs for their widgets? The important difference, I think, is that they're using their own materials and electricity to make their goods, but people who engage in copyright infringement are too.

EDIT: And I'd note that many would would say that this second person is "Stealing the customers" of the first factory owner, but that doesn't mean what he does is actually morally equivalent to stealing.

If they make their own factory then that is ok. Simple capitalism. That is not my point, however. If they use the original factory without paying that is not ok.