Sure, there are different calibers of senior engineers, some are better than others. Some are better leaders, some are better writers, some are better instructors, etc.

But, principal, staff, lead, and senior are all pretty much the same tech skill level. Promotions to higher levels are mostly based on subjective attributes, like leadership qualities, personable qualities, innovation qualities, etc.

It’s mostly HR process to keep more rungs in individual contributor career track. Way to retain high performance engineers in the career ladder, and show that there are more opportunities for advancement.