The Phoenix area is really only has a metropolitan statistical area rank of 10 so it's about the size of Atlanta or the Boston area in terms of population. By GDP it's only 16 which is lower than the Detroit area.
It is a lot of people but it's not even close to being #4 once you account for desert cities being physically larger due to geography and political needs.
That said, SpaceX/Elon should not have sold the product anywhere where it could not withstand the environment.