I think mostly it is the fit and finish. I've been in a 2016 BMW 750i and a 2013 Model S, for about a total of maybe 30 minutes in the BMW and 10 in the Tesla.

The interior of the 7 series seemed special to me. All of the buttons felt great, seats looked beautiful and were super comfortable to sit in. The control panel had many small OLED displays and they looked great. And small details like when I went to adjust the seat, by placing my fingers on the buttons, information about my seat configuration popped up on the center console, so I could see what I was changing. Also the rear passenger seats and rear windshield had power sunscreens.

Here is a picture of the iterior of the BMW: http://st.motortrend.com/uploads/sites/5/2015/11/2016-BMW-75...

Here is a video of the 7 series interior: https://www.youtube.com/watch?v=GHDMAibH1G4

In comparison, the Tesla's interior felt mostly large and empty.

Here is a picutre of the interior of a 2016 Model X: http://st.motortrend.com/uploads/sites/5/2016/03/2016-Tesla-...

Don't get me wrong, Tesla makes some super amazing cars. But the high price tag isn't for the interior.

(Disclaimer: I own a lowly 3 series so I may be slightly biased to BMW)

Not the OP, but I assume they mean fit and finish, quality of interiors etc are superior in the Mercedes than in the Tesla.