I think it was a case of too many lines of pistols in an already over saturated market...
They had the XD series (now called “Defender”).
They had the XDm series.
They had the XDs series.
They had the XDe series.
Thrn they came out with “Mod 2”...which, of we’re being honest...besides a different grip, and a little different styling on the slide machining, was the same pistol as the XD...and they’re all fighting for pretty much the same market segment. Something had to go, and I’m willing to bet HS in Croatia didn’t want to discontinue making the original HS2000/XD”Defender”.
Now they’ve come out with the new XDm series, and I’m willing to bet the original XDm's are going to go away.
The Mod2 will carry on in the XDs line, though...I think the original XDs design is no longer in their catalog.