According to some news, many employees from the project will be transferred to the iPhone maker’s artificial intelligence (AI) division. Apple did not immediately respond to a BBC request for a comment.

The company has never publicly acknowledged the project, which involves around two thousand people.

The team working on electric vehicles was known as the Special Projects Group as part of its chief executive, Tim Cook’s Project Titan. Initially rumored to be working on a fully autonomous vehicle without a steering wheel and pedals, the company spent billions of dollars on research and development.

The team was believed to be years away from producing a vehicle. “This is a smart and long-awaited decision,” said Ray Wang, founder and chief executive of Silicon Valley-based consultancy Constellation Research, speaking to the BBC. “The market demand for EVs is not there and AI is where all the action is,” he added.

Beyond the iPhone and computers, Apple has been exploring other opportunities, including its recently launched Vision Pro virtual reality headset. Research firm Counterpoint highlighted that the decision came as the market for AI in consumer electronics is growing sharply.

“Preliminary data suggests shipments of generative AI smartphones will exceed 100 million units in 2024,” said its senior analyst, Ivan Lam. Counterpoint predicts that number could surpass 500 million by 2027.

Demand for EVs has slowed in recent months as borrowing costs remain high, intensifying market competition as major players vie for customers.

In recent months, the motor industry giants in the US, like Ford and General Motors, have postponed plans to expand EV production.

Last week, electric truck maker Rivian announced a 10% reduction in its workforce and anticipated no growth in production this year. In January, Tesla cautioned that its sales growth would be weaker this year compared to 2023.

Led by multi-billionaire Elon Musk, the company has slashed prices in key markets globally, including Europe and China, to counter tough competition from Chinese rivals such as BYD.

Mr. Musk responded on the social media platform X, formerly known as Twitter, to a report that the Apple project was being wound down with emojis of a salute and a cigarette.