Being a low cost producer is a great survival strategy, even for a new entrant. Walmart, Amazon, and PC vs. Minicomputer are good examples. You can either use your cost advantage to undercut prices profitably, or use your large margins to outspend on R&D, marketing, etc.

Selling at low prices given the same cost structure is not a good survival strategy. "We lose money on every unit but we'll make it up on volume!"