If he's a ready to go as he claims, a party challenge would give him a chance to regain support. If he can rise above challengers, it would provide more confidence that he's a good pick, rather than just being not donald.
At this point, Biden is really running against himself. Don is don. Everyone knows who that creep is. Biden's only electability challenges are with regard to his own personal capability, and he can show that against anyone - including primary challengers.
Honestly he should probably welcome opening things up rather than asking for them to be locked down. It's just another opportunity for him to win support. And if someone else wins support, great.
Though the only appropriate time for a primary challenge against Joe Biden would have been the normal primary season. I'm not convinced that this late in the game, Biden being successfully being replaced will ensure that the Democrats will win in 2024 when they otherwise wouldn't. While literally any serious candidate would be more electable than Biden, the optics surrounding this entire debacle are really damaging, especially if that nominee would be someone other than Harris.
At face value it's understandable that there was no formal primary against Biden because there is almost never one while an incumbent president is in office. But it's for good reason that the presidency is two four-year terms instead of a single eight-year term. Not only was Biden historically unpopular, but also less fit- which the national party arrogantly shooed over- especially motivating a primary, in which rising stars in the party can make their case.
But if you think that Biden's debate against Trump was bad, a primary debate against Biden would look significantly worse. Even a relatively milquetoast candidate like Newsom would wipe up the floor with him. Not only would literally any Democrat look better for being younger, more energetic, and more in control over their own words, but they would also expose that he just isn't as representative of the party's base compared to many other candidates. He would have to answer why he so ardently supports Israel, why he hasn't proposed a plan to expand healthcare access, while he still opposes legalizing marijuana, why he didn't do more to circumvent legislative challenges posed by Manchin and Sinema, why he cannot excite the youth and is slipping with Hispanic/Latino voters, among other tough questions. There is simply much less room to look bad when Biden is attacked for ridiculous, conspiratorial things by Trump then legitimate concerns from his own party/voter base.
The Democrats could have readily made this choice in 2023. Do they quell any primary efforts or intra-party dissent and run Biden regardless of whether or not he seems able to deliver a victory? Or do they embrace change, have a fair primary, and come to understand that whoever the winner is- whether Biden or not- is the best choice the party can put forward. Because it certainly isn't Biden and even the insiders know it, but they're too concerned with not rocking the boat, protecting Biden's pride and ego- despite it seriously damaging his own potential legacy- because it's what Biden wants, just like Feinstein and RBG refusing to resign when it was well past their time. Nevertheless, it's simply too late now to replace Biden. The best case scenario is that enough Americans reluctantly vote for him because they recognize the perils of four more years of Trump and Project 2025, because there is simply nothing Biden can do to make himself look any more convincing. The damage has been done.