JXL's war is not with AVIF, which is already a de-facto standard which has near-universal browser support, is enshrined as an Apple image default, will only become more popular as AV1 video does, etc. It's not going anywhere.
That's not to say that JXL is bad or going away. It currently has poor browser support, but it's now finding its footing in niche use cases (archival, prosumer photography, medical), and will eventually become ubiquitous enough to just be what the average person refers to as "JPEG" 10 years from now.
To address selected claims made in the post:
• "AVIF is 'homegrown'" – AVIF is an open, royalty-free AOMedia standard developed by the Alliance for Open Media (Google, Microsoft, Amazon, Netflix, Mozilla, etc.).
• "AVIF is 'inferior'" – AVIF is significantly better than JPEG/WebP in compression efficiency at comparable quality, and comparable with JXL in many scenarios.
• "AVIF is ridiculous in this aspect, capping at 8,193×4,320." — JXL's theoretical maximum image size is bigger. The author cites AVIF's Baseline profile (think embedded devices), but AVIF supports 16,384×8,704 per tile. It HEIF container format supports a grid of up to 65,535 tiles (so logical images sizes up to 1,073,725,440 wide or 283,111,200 tall).
So, JPEG XL is good. Yes, it's far behind AVIF in terms of adoption and ecosystem, but that will improve. AVIF is likely to erase any current JXL quality advantages with AV2, but both JXL and AV1/AV2 encoders will get better with time, so they're likely to be neck-and-neck in quality for the foreseeable future.
I seem to recall that a large part of the stated rationale at the time the Chrome Team decided to deprecate support for JXL was that they had support for both AVIF and JXL, and AVIF was good enough.
This might be the origin of the "competition" in the context of this Google decision/reversal.