It’s important to remember that Saleh dissolved the alliance with the Houthis days before his demise, with some suggesting the plan had been in play for months. Furthermore, Saleh’s son, Ahmed, although a somewhat divisive choice of potential successor, was reportedly involved in discussions of a deal with Saudi, which means that there is still a potential for such an agreement.
Given that the Houthis are faced with a significant loss of military might and, consequently, a vital bargaining chip, they may come to realise that negotiations are the way forward regardless. Nevertheless, they are likely to look even more to Iran should the conflict continue due to the loss of their Yemen-based ally and, potentially, in order to improve their bargaining power by, for example, solidifying their control over the capital.