It won’t be over, because this will become the standard iPhone in the future.
you are correct.
apple uses the branding of Air (on iPad and MacBook) to be the phone and mac that almost all reviewers say very clearly time and time again that "most" people should buy (probably simply meaning that Pro is not needed and there Air version is powerful enough at reasonable price).
apple used iPhone Air (first gen) to launch the Air concept on the iPhone. it points very clearly to the future of an established line of iPhones that will have great features, but not Pro level features. yes. it will cost a lot. but probably the iPhone Pro models prices will be increased enough next time to create an even bigger gap with the iPhone Air 2 price.
most users don't need Pro level features.
most users don't want to pay a Pro level price.
iPhone will get better cameras. get better speakers. but stay light and thin. battery life will be slightly better (meaning by the way, that it does meet the needs of almost everyone).
the Pro iPhones will get heavier. more gnarly in shape. and ultra good battery life. and you will be paying much more for them, which will drive people to the Air.
but. the RAM Apocalypse happened. apple still needs to overcome the marketing awkwardness of a base level iPhone and and Air costing too close to each other. in order to overcome this, apple will employ strategy similar to its iPad vs iPad Air, and, Mac Neo and MacBook Air playbooks.
you can expect the base level iPhone (iPhone 18) to be even closer to the equivalent of what an iPhone 18e might look like. and "e" level iPhone looks more and more to be phased out, certainly by 2028/29.
the Mac Neo fulfills basic level needs. iPhone 18 will have pretty colors and only 9GB RAM.
the Air is the future mass targeted device.