It might be worth considering a sense of scale here. What price point constitutes a beginner guitar? What price point constitutes spending more money than is warranted? What price point have we crossed the value over name on headstock?
The following is my opinio (probably everything I write is my opinion, but this should be called out as not fact, just personal observation and consideration):
$100 is a beginner guitar. You can find electric guitar + mini amp combos for $100-150. I'm not sure how big the amp is, but I suspect battery powered crappiness.
the hardware tends to be cheaper, which wears out quicker, etc.
You can hit a pawnshop with $40-50 and get a better, small practice amp.
$100-150 used will get you a good sized solid-state combo amp that you could gig with, providing the amps are mic'd for the venue (to go through a PA for FoH sound). If you're chasing tube-tone, that'd be a different ball game. The same amps can be had new for $300-400. At this size, it's loud enough to annoy the neighbors, yet still light enough to lug around.
In guitars, I find that $300 seems to be the threshold of "cheap" guitar to good working instrument that will hold up if he takes care of it.
Over $1000, I find to be entering the realm of deluxe materials, name on headstock, with little added to the actual instrument.
That kind of money puts a crosshair on this kid's axe. If his friends realize that there's a portable pile of cash sitting in that case in his room, it can be very tempting to grab it and pawn it. It's kind of like handing kids new iPhones. There's already a rampant business in stolen smartphones, with women getting punched in the face and having their phones taken from their hand on the street. Kids should not be put in a position to secure, defend, protect highly valuable objects that they are not really able to perform those duties.
So, on electric, I see spending $300 for a good amp, possibly $300 for a multi-FX pedal, and at least $300 on the guitar. I would also make sure it has a hardcase for transport, and a guitar stand so he can set it down properly when he takes a break from using it. I suspect he's lacking those 2 accesories and the first guitar is suffering abuse by lack of safe treatment.
Because of thise, it might also be worth considering that spendingg $1500 on a deluxe guitar now may mean it suffers too much abuse/damage/risk. Whereas spending $500 will excite him, give him something nice to play, and not be as huge a loss if the worst should come to pass. When he is older still, he will appreciate and be better ready for a more expensive instrument.