You are quite right. The Nazi plan was to move East, as seen in MK.
Hitler never wanted to fight UK. He actually wanted to make peace after the Battle of France, leaving UK free to dominate the rest of the world while he took Europe. He assumed, not unreasonably, that the Brits would make peace after such a total defeat. He was absolutely shocked when they gave no sign at all of interest in peace.
From the POV of Nazi ideology, fighting in western Europe at all was a diversion from the true German destiny in the East.
“Hitler never wanted to fight UK. He actually wanted to make peace after the Battle of France, leaving UK free to dominate the rest of the world while he took Europe. He assumed, not unreasonably, that the Brits would make peace after such a total defeat. He was absolutely shocked when they gave no sign at all of interest in peace.”
It is true that Hitler envisaged an alliance with Britain when he wrote Mein Kampf, and his hopes were encouraged somewhat by the later naval treaty with Britain. However, Hitler reversed his attitude towards Britain in 1938 when Britain entered into alliances with Poalnd and France in the aftermath of the Munich agreement that surrendered the Sudetenland from czechoslovakia to Germany. from that point onward Hitler planned the conquest and recolonization of Britain by German colonists as the British population was exterminated in an even more comprehensive manner than Poland. Hitler’s comments in 1940 were more in the form of disingenuous propaganda to disarm those Britons who were disposed to fight to the bitter end. Hitler’s genuine intent by 1940 was to enslave and exterminate the population of Britain.
“From the POV of Nazi ideology, fighting in western Europe at all was a diversion from the true German destiny in the East.” Once Britain made it clear that it would remain a threat to Germany’s ambitions with a blockade of the continental powers as was accomplished in World War One, Hitler’s priority was to neutralize the threat in the West before pursuing the conquest of lebensraum in the East. Hitler intended to fight on one front at a time, which is why he entered into the non-aggression pact with the Soviet Union. Stalin’s imminent invasion plans and Germany’s desperate need for war material in Soviet territories caused Hitler to compromise his strategy. Hitler’s failure to defeat and occupy Britain in time to open sea trade for petroleum, iron ore, rubber, and other critical war supplies forced his hand into taking on Stalin’s forces before the completion of the the western campaigns.