Today the 13" M1 MBA and MBP are near identical which questions why the latter exists at all. Ditching the M1 MBP would make sense (especially if you end up adding magsafe or any of the other ports back into the ‘lesser’ models).
The MacBook used to be the entry level model with the Pro being better, although how much has always been a wildcard depending on the product release cycle which just adds to the confusion.
If I could wave my magic wand I’d make two broad categories, Entry level and Pro.
Entry level would be the MacBook Air so they can keep the name and mostly because they probably don’t want to move away from that smaller form factor the Air has over the current 13" M1 Pro.
SKU’s… is an interesting one. In principle they could have a single SKU with everything else being BTO. Make it simple for resellers to stock and also make the upsell to the Pro a little easier (or pushes more people direct to Apple for BTO which can’t hurt the profit margins).
Otherwise, three basic SKU’s covers pretty much everyone and would allow people to walk into their local JB and buy something suitable. Today two of these exist, but I think a third option with higher specs as a standard offering would be excellent and would also help to bridge the gap to the Pro models (using their current pricing for reference it would look like this):
8GB RAM 256GB Storage - $1,499
8GB RAM, 512GB Storage - $1,849
16GB RAM, 1TB Storage - $2,449
Pro Range.
Need more power and ports? Go Pro! Easy enough upsell, especially to anyone who doesn’t want to live in dongle town (although I keep saying that if you bite the bullet and replace your cables once you pretty much don’t need any dongles anyway).
14" vs 16" is about personal preference on size. There seems to be zero functional or performance difference between the two other than battery life thanks to the larger chassis holder more battery… and even then, those numbers are so large they probably don’t make much a of a difference anyway. Is anyone buying a 16" over a 16" because they NEEEED more battery life?
The 14" does have a couple of lower end model configurations making the step from the base 14" to the base 16" $750 (which hurts for people who just want the larger display), but once you spec them to the same level the differences are only $300 more for the larger display (and battery).
So do we get a “MacBook” shoved in the middle with all the ports of the Pro but the power of the M1? I wouldn’t make that product since it would suck too much of the upsell business away from the Pro line. Assuming the current price remained, $2,199 for 512GB storage (8GB RAM) MacBook but with all those shiny new ports from the Pro range? How hard would it be to convince people that extra $800 was worthwhile? (Assuming we trade off the touchbar for the ports).