The high cost is usually due to re-re-re-re-re-re-design.
If a game is projected to take two years to complete, and ends up taking five years, it's not like they were spending that time making 3x the amount of art or getting rid of every bug. What happens is they design, try it out, don't like it, re-design, don't like it, re-design, try it out, don't like it, etc. The design team will ask for extensions, get it, and start on another round of re-re-re-re-design. This constant re-design loop can also be driven by people at higher levels, but it's usually the design team themselves.
While that process is going on, there is the programming team having to constantly re-re-re-re-engineer systems and create new ones. There is a core team of artists who are also making assets for prototyping, demos, and marketing.
Eventually, the studio and publisher puts a gun to the re-re-re-re-re-design team's heads and says, ship or else. And ship it fast.
This is where a shitload of artists are hired to get the project finished. Artists typically finish their sprints with a 95% completion rate. Studios can also crunch them to get even more work out of them for their salaries. Most of the art you see in a game that went one, two, five, or more years over schedule was made in the last year of the project. The current plan to reduce costs is to get rid of the artists, those people who complete tasks and ship games, with AI in the hands of designers. I'm not sure if anyone has looked at the numbers in Jira lately, but I don't think it's going to work like they plan.
This sort of process has been going on for decades in Western games. It has nothing to do with budgets, DEI, or graphics resolution.
You can go back over the past 25 years and see lots of examples of this endless re-design loop.
In the case of games with massive budgets that do ship on time, that is mostly due to marketing.
Last of Us Part 2 dev time - almost six years
For example, Naughty Dog’s
Uncharted 2: Among Thieves, released in 2009,
cost $20 million. The studio’s most recent game, 2020’s
The Last of Us Part II,
cost $220 million.
Uncharted 2 dev time - 22 months
Last of Us Part 2 dev time - 70 months
If you take 70 months to make a game, there is no way that the art made in year one is used in the final game. That is at least one and a half console generations.