I think they will eventually get to the point of technological differentiation but they've got to start somewhere: they must first have an electric car on the market before they can start experimenting with it to improve the performance 1.5x, 2x, 10x.

At some point, EVs are going to pull ahead of ICE cars not just incrementally, but categorically. Instead of 0-60 in 3 seconds, it'll be 0-60 in under a second: the limits are physics and the human body, not the engine. Full self-driving, native to the architecture. Over-the-air updates that do things like improve the car's range by 5% (Tesla did something like this). And more no one's thought of yet.

So, this is their beachhead. You've got to start somewhere: they're starting here.

It's a Veblen good.

The point of the Ferrari is it's high price point. People turn their heads to look at a Ferrari because it's expensive, not because it's a practical and reasonably priced luxury car (eg some lower end Porche models). The higher price makes it more attractive to a certain demographic and most of us in the comments don't belong to that group.