I guess the question is how much they'd gain in acceleration/performance (and thus be able to give up on battery capacity) by making the overall vehicle smaller and (ex-battery) 200-300 pounds lighter, vs. how much space for battery they'd give up. I don't mind if the S4-replacement costs $60-80k (loaded) vs. $80-100k for a Model S.
I'd also take a car which had the same general size and chassis as the Model S but with a larger, more-secure trunk at the cost of seating capacity. My dream car is a 2-seat coupe with a trunk the size of a compact pickup truck bed.
Sorry, I don't think the tech is there. Either the range would suffer (due to more compact frame allowing for fewer cells safely) or the power would be gimped (to allow for lower overall battery capacity).
Electric cars are competing with the entire petroleum-fuel supply chain, and as such, are fighting a david vs. goliath battle.
That Tesla does this, has won consistently, and wins with style is why their stock is up 500% over the past year.
Of course, they've picked their battles, and fighting the S4 or 3 series isn't one of those they're ready to fight (yet). Maybe, like Apple, they never will (Apple ceded the enthusiast/gaming desktop market years ago).