They will need at least half a billion a year to replace the cash America gave them.
They will never make that up in volume. They can not even afford that on their own economy. You can not just print the cash and hope, even in a communist state. Inflation will happen.

This is like Germany giving away the Trabant just to keep the factory open. Even if people accepted them they would never go any buy the next one.

I think the opposite is the case. This is another sign that Roscosmos and some or many of its rockets are in serious trouble. With the pricing being the same, SpaceX’s Falcon 9 is the preferred rocket. Even if the price of Proton is further reduced, only customers with redundant payloads (e.g. constellations that can afford to lose a satellite or so without greatly affecting their business plan) are likely to risk a Proton launch. This was seen with Falcon 9 and the Air Force launching GPS satellites in the early days; there were enough of these satellites that they could lose one and still build their replacement constellation.

ULA, on the other hand, has a very strong reliability record. This reliability has been high in their marketing strategy. Although they have worked hard to reduce their launch prices, they have not felt compelled to try to match SpaceX prices, yet they do not fear that they are going out of business.

In order to cut its Proton prices, ROSCOSMOS will have to end that flow to Putin’s Oligarchs. Whether this can first be done is unknown. Whether it can be sustained without the loss of those oligarchs from Putin’s supporters remains deeply in doubt.

Rockets that fail will find no market, regardless of price.

In the end, this will force SpaceX to become even more competitive. Something which they have demonstrated great skill at and will be good for the market overall. Even with the price cuts, the burden seems to be on Roscosmos to prove that they can deliver “reliable” Proton launches at the reduced costs.

I believe the bigger threat to SpaceX is that the market may simply not respond as fast to lower launch costs (ie. grow faster) than they anticipated. If there were clear signs the launch market was growing faster, anti-competitive practices such as this would be less significant.