I think Tesla will eventually have to decide on a direction for the S, to drift higher or lower in its competitive target, in line with inevitable changes to tax credits.

It'll be interesting to see if they try to move down to compete with the BMW 5 category over time. Or whether they attempt to push quality higher, raise prices and fully compete with the next tier up.

The Model 3 is very clearly going to stay focused on competing with the BMW 3 (and equivalent from Mercedes et al.) over time.

Perhaps Musk will push a new sedan into the mix eventually to more properly align with how the BMW 3, 5, 7 series is set up.