I'm not a parent but when I was younger buying my first car my parents did something similar. Only difference being what they paid I paid them back for. I always imagined that when/if I have children I would do much the same. As you said its about learning responsibility. As long as your son knows the why of it I don't think you're being too hard on him at all. But that's just my 2 cents from a non parent.
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Thank you. I appreciate sharing your experience.