Note that Muni cannot legally reduce cable car service; the city charter[1] mandates a minimum level of service, due to a 1947 ballot proposition[2]. As your link notes:

*> Cable cars are a symbol of San Francisco, a major tourist attraction, and an indelible feature of the city’s cultural and historical landscape. [...] While SPUR doesn’t recommend changing SFMTA’s role in cable car operations, the agency may wish to explore options to generate additional revenue from the cable car system or seek supplemental support from the city’s budget, given the outsized expense of providing cable car service and the unique value this mode brings to the city as a cultural attraction. SFMTA already acknowledges the special status of cable cars by pricing them differently from other modes and by excluding cable car service from some of its passes and fare discount programs.

Apart from that, I suspect the per-service-hour figure is particularly misleading for cable cars and removing one cable car from the schedule would free up significantly less than $871: there is a significant fixed overhead (from power usage and cable wear) to having the system running at all, regardless of how many cars are on it.

1: https://codelibrary.amlegal.com/codes/san_francisco/latest/s... 2: https://www.cablecarmuseum.org/60th_Anniversay.html