Current predictions are that focus has shifted to an "ITSy." This half scale version of the ITS will have 21 engines instead of 42 and still be the strongest rocket ever built, but it's focused more on initial Mars trips instead of full scale colonization.
There are a few reasons why this makes sense:
- Fully ITS will cost billions of dollars while this will cost less billions. Overall costs more for both vehicle designs but there's less financial risk at each stage.
- ITSy will be used for commercial launches around Earth and pay for itself. With both first and second stage recovery, it should be cheaper than Falcon Heavy for big satellites. Full ITS was only planned for Mars missions.
- ITSy can function as a test bed for the full scale design. It'll still have all the same elements involved such as in orbit refueling, Mars refueling, and landing on the launch pad.
- The carbon fiber tank for the full scale ITS ruptured during testing. This could be a sign that the tank designs are not ready yet and need more time to solve the problems. ITSy could use more standard fuel tanks and make SpaceX keep progressing while waiting for carbon fiber to catch up.
- NASA is planning commercial contracts for the moon. SpaceX could bid ITSy as a lunar lander and have NASA pay for most of the funding, similar to how Dragon and Falcon 9 reusability were developed. ITSy could land significant fuel on the Moon and return to Earth for a fraction of the cost of other methods.
- ITSy will be ~9 meters in diameter instead of the 12 meter full scale ITS. This is small enough that ITSy could be created in existing SpaceX factories without the need of constructing new buildings.
- It's more realistic to build launch pads that support both Falcon and ITSy. Boca Chica in Texas is being built to support ITSy and will be ready in 2019.