Niche product, non-standard components, strict requirements of free drivers with GNU/Linux support: https://puri.sm/posts/breaking-ground/

Yes exactly that. The weak hardware at those prices are the best they can afford. The economy of scale that they can afford let's them charge that little for flagship phone and still makes money. People won't put their money where their mouths are, we're all too cheap to pay what things are really worth.

It's not just this but there are also devices that can be sold artificially cheaper because advertisers are the real customers