Excellent point.
In fact the reality is the M1 was only able to exist from a business perspective BECAUSE of all the willing consumers willing to pay the Apple Tax. Apple is in a unique situation where their margins are wide enough they could "risk" an investment of this type. Even for Apple it probably took years of carefully analyzing the situation to make sure it was a sound business decision.
Literally very few companies (if any) could do what Apple is doing. On one hand it proves what a large margin Apple has, on the other hand it is a huge development for humankind?
As I said above, I think the development costs for the M1-series of chips wasn't that much. They were piggy-backing onto the A14 development, which did all of the heavy (cost) lifting.