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The pair were vying for a potential podium finish when Power divebombed McLaughlin and put him into the wall in the final laps.
The Kiwi was left irate by the incident, sarcastically clapping as his teammate passed the scene of the crime a lap later.
McLaughlin and Power were running fourth and fifth before the clash.
For the incident, the Australian was given a drive-through penalty and went on to finish 12th while McLaughlin was classified 16th.
Speaking at the latest IndyCar race at Gateway, McLaughlin said any perceived grievances had been settled.
“We talked basically straight after the race and then throughout the week,” McLaughlin explained.
“We’re good as gold. Just a couple of Australians butting heads… well, I’m not Australian, I’m a Kiwi, but down under.
“All Blacks versus the Wallabies, we’re used to that rivalry, but me and Will, we work together really well. I think all three of us work together really well.
“You’re never going to have it be 100 percent the whole way. You’re going to have ups and downs, but it’s how you rebound from that, and I think we’ve rebounded really well.
“We’re working together, and certainly we both want to win this championship, so we’re working towards that.”
Now the Penske teammates collide in the closing laps!@smclaughlin93 is out of the race!
📺: #IndyTO on Peacock pic.twitter.com/NsoXIjcmNN
— NTT INDYCAR SERIES (@IndyCar) July 21, 2024
McLaughlin will start Sunday morning’s race from pole position while Power is set to start from fifth.
With five races remaining in the season, the Kiwi is still holding out hope that he can draw back the 83-point deficit and snatch the series lead away from Chip Ganassi Racing’s Alex Palou.
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“There’s no doubt I’ve come from basically the back at the start of this year, and we’ve found ourselves in position in less races,” McLaughlin explained.
“There’s anything that can happen in this sport. It takes one bad race from Palou, and everyone is jumping down his neck.
“I think we’re well in reach to get there if we can perform well on the ovals, which I know I feel comfortable on the ovals now.
“There’s no doubt in my mind we can get there. Yeah, 100 percent confidence.”
