John Gruber, in his iPhone 17e review, regards the iPhone 16/Plus models as overshadowed by the strong iPhone 17 lineup — even for budget buyers:

I suspect Apple is on the cusp of completely moving away from the strategy of selling two- and three-year-old iPhones at lower prices, and updating their entire lineup with annual speed bumps.

It would be hard for the finance and operations teams, guided by Tim Cook hand, to give up that bonus margin from selling years-old products. But the extra manufacturing capacity, bulk component pricing, and simplified sales flow should soften the blow.