diff --git a/mercurial/sshpeer.py b/mercurial/sshpeer.py
--- a/mercurial/sshpeer.py
+++ b/mercurial/sshpeer.py
@@ -115,35 +115,15 @@
         return self._main.flush()
 
 class sshpeer(wireproto.wirepeer):
-    def __init__(self, ui, path, create=False):
+    def __init__(self, ui, path, create=False, sshstate=None):
         self._url = path
         self._ui = ui
         self._pipeo = self._pipei = self._pipee = None
 
         u = util.url(path, parsequery=False, parsefragment=False)
-
-        self._user = u.user
-        self._host = u.host
-        self._port = u.port
         self._path = u.path or '.'
 
-        sshcmd = self.ui.config("ui", "ssh")
-        remotecmd = self.ui.config("ui", "remotecmd")
-        sshaddenv = dict(self.ui.configitems("sshenv"))
-        sshenv = util.shellenviron(sshaddenv)
-
-        args = util.sshargs(sshcmd, self._host, self._user, self._port)
-
-        if create:
-            cmd = '%s %s %s' % (sshcmd, args,
-                util.shellquote("%s init %s" %
-                    (_serverquote(remotecmd), _serverquote(self._path))))
-            ui.debug('running %s\n' % cmd)
-            res = ui.system(cmd, blockedtag='sshpeer', environ=sshenv)
-            if res != 0:
-                self._abort(error.RepoError(_("could not create remote repo")))
-
-        self._validaterepo(sshcmd, args, remotecmd, sshenv)
+        self._validaterepo(*sshstate)
 
     # Begin of _basepeer interface.
 
@@ -377,4 +357,23 @@
     if u.passwd is not None:
         raise error.RepoError(_('password in URL not supported'))
 
-    return sshpeer(ui, path, create=create)
+    sshcmd = ui.config('ui', 'ssh')
+    remotecmd = ui.config('ui', 'remotecmd')
+    sshaddenv = dict(ui.configitems('sshenv'))
+    sshenv = util.shellenviron(sshaddenv)
+    remotepath = u.path or '.'
+
+    args = util.sshargs(sshcmd, u.host, u.user, u.port)
+
+    if create:
+        cmd = '%s %s %s' % (sshcmd, args,
+            util.shellquote('%s init %s' %
+                (_serverquote(remotecmd), _serverquote(remotepath))))
+        ui.debug('running %s\n' % cmd)
+        res = ui.system(cmd, blockedtag='sshpeer', environ=sshenv)
+        if res != 0:
+            raise error.RepoError(_('could not create remote repo'))
+
+    sshstate = (sshcmd, args, remotecmd, sshenv)
+
+    return sshpeer(ui, path, create=create, sshstate=sshstate)
diff --git a/tests/test-check-interfaces.py b/tests/test-check-interfaces.py
--- a/tests/test-check-interfaces.py
+++ b/tests/test-check-interfaces.py
@@ -69,7 +69,7 @@
     checkobject(badpeer())
     checkobject(httppeer.httppeer(ui, 'http://localhost'))
     checkobject(localrepo.localpeer(dummyrepo()))
-    checkobject(testingsshpeer(ui, 'ssh://localhost/foo'))
+    checkobject(testingsshpeer(ui, 'ssh://localhost/foo', False, ()))
     checkobject(bundlerepo.bundlepeer(dummyrepo()))
     checkobject(statichttprepo.statichttppeer(dummyrepo()))
     checkobject(unionrepo.unionpeer(dummyrepo()))