Leica had teased the market about a mysterious "Mini-M" model coming. People speculated, most involved a cheaper M-mount camera (possibly with an APS-C sensor like the X2 or earlier M8). In the end, Leica announced the X Vario which physically resembles a larger Leica X2 as much as a thinner M camera, and which has a fixed zoom lens in front of an APS-C sensor. Leica other Leica cameras, there is no proper image stabilization (instead using the multi-shot method found in the other X cameras), and many commenters have criticised the slow F3.5-F6.4 lens in a camera that is priced on-par with the 35mm full-framed Sony Cyber-shot DSC-RX1. The longer lens on the X Vario does lead to some ergonomic improvements, focusing with earlier X cameras was never natural, relying on an on-screen meter and a combination of button presses and wheel movements. The X Vario adds a focusing ring to the lens which also allows a ready toggle between auto-focus and manual-focus just by rotating the lens to the extreme—this in itself might be worth a change of camera if you are on the edge.
Compared to the earlier Leica X cameras, the size is definitely off-putting, as is the increased price. Top-plate ergonomics are the same as previous models, and in general handling is better.