well, I was one of those people who compared those exact cars and chose a Model S...actually moving from a 7. I also included the S8 in that search too. In fact, I don't think that Im alone.
...So, from a pricing perspective, I could have easily purchased a very well appointed 7 or S class and there isn't a 5 series on the planet that expensive...not even sure if the M5 can reach that target.
My 7 series was a nightmare right from the start...
I'm guessing many of us have been in a similar spot. FWIW I speced an M5 as nearly the same as my loaded P85D and came up with the M5 at an MSRP of $135,152. I have no idea how to adjust for the 8 year drivetrain warranty nor the Superchargers, but with he MSRP that close it's hard to disagree with your basic point; price simply is not a relevant distinguishing factor when we compare Mode S or X with their equivalents in ICE.
It seems to me that, if the survey data are accurate, Tesla buyers engage quite a lot of people wo simply would never be in the market for a ICE equivalent, either due to cost or other factors. Notwithstanding Tesla outselling ICE comparable vehicles, we all probably would agree that Tesla also is vastly increasing the market for vehicles in the price class.
It is not strictly comparable but still is probably relevant that when VW bought Bentley and introduced the Continental and later the Flying Spur global and US car sales with MSRP about $150,000 suddenly more than doubled. Now there are many competitors but the Bentleys created a new segment. That is IMHO analogous because many people are spending more on Tesla's than they've ever spent on any other car. In addition, there are the slim majority of Tesla buyers, probably, who have spent that sort of money on cars and select the Tesla because they think it a better choice.
I am intrigued by the extent to which the Tesla phenomenon is actually expanding a market segment apart from the EV facts. What people like Bob Lutz miss is that change. What the fans among us must realize is that tesla is still a startup in automotive terms so has all the instability associated with that. Still, people are buying the vehicles regardless.
Probably I should realize that I myself have never advocated that anybody else buy a car that I bought. Now I find myself doing that most days. Oddly, I also find myself recommending Leaf, and several of my less-well-heeled acquaintances have bought Leaf's not to mention the others who have bought S's. As we consider what we would have bought, we might also think about how our recommendations to other people have changed.
Finally, I had horrible experiences with a Z1 (hardly surprising), an M5 and an M3 and finally gave up on BMW. Tesla has had zero difficult experiences, so I rather wonder if the excellent service might the affecting other owners as it has affected me. Part of that may well be about the dealership experience but...
