Yes, Apple is cutting the Air's production early this year, but in years past they have cut the production of the base iPhone early or the Plus early. This is not something never before seen. It happens every year, just with a different model.
When the lineup stays static, Apple has a pretty solid idea of what these initial production runs should be per model. When they throw in a new model (Mini, Plus, Air) they have to do a bit of prognostication and it is not surprising they often guess too high for this new model and so they need to reduce it early once they have a clearer idea of initial sales.
In early 2026, Apple will announce cuts to the production run of the other iPhone models just as they do every year. And the headlines will again hyperventilate how this is some sign that the iPhone 17 is a flop just as they did when this happened to the iPhone 16. And iPhone 15. And iPhone 14. And...
Apple's heaviest production run is prior to release to meet the initial demand and then they reduce it to meet the (lower) sustained sales volume over the rest of the year until they ramp up again for the next model in the Summer.
This has been the way for like a decade. Why the media keep acting like it is unique every year is beyond me.