It's a very different market today than when Tesla started. Tesla's strategy of starting at the high end was necessary to build electric cars from scratch. New competitors can start with existing supply chains and a base of engineering expertise.
I do think Tesla has lost sight of their original plan, though. They should have kept going through one more generation of significant cost reduction/increased volume after Model 3/Y. They are intentionally leaving this part of the market to competitors as they focus on self driving, and I think it's a mistake that will cost them in the near term.
