They are doing less work. Designing a lower performance engine is harder and more expensive than producing more of the higher performance engine and limiting it.

It works in the market because sellers sellers want to charge as much as buyers are ready to pay. People who want a powerful engine are ready to pay more, so make them pay more. The limited power option is sold at a lower but still profitable margin to those who don't want to pay for the extra.

Market segmentation like this is seen everywhere. It is just that the subscription thing makes it particularly obvious.