At this point, I disagree that it's because of the incentives. In fact, at the Model S price point, it probably had nothing to do with incentives, which are (if you're 'lucky', 10% at $100k pricepoint).

First to market, yes. And first to make it 'cool'. I have a hard time thinking BMW bolting batteries into a car will take away from the novelty factor of the Model S. It's not just about propulsion, it's everything -- the styling, the electronics, the early adopter thing, street cred, etc.

It's "do you want to buy one of half a dozen old school cars, or this new COOL thing?"

How many Prius owners have seen a Honda hybrid of some sort and been surprised that Honda makes a hybrid?