Honda Motor and General Motors have decided not to proceed with joint plans to develop affordable electric vehicles, the companies said.

"After extensive studies and analysis, we have come to a mutual decision to discontinue the program. Each company remains committed to affordability in the EV market," the companies said in a joint statement.

The news comes just over a year after the automakers agreed to collaborate in a $5 billion effort to compete with Tesla in sales.

GM's decision reflects a strategic shift to prioritize profitability by slowing the release of EV models amid the costly United Auto Workers strikes, reported Reuters, which said Honda still confirmed its commitment to selling only electrified vehicles by 2040.

The two firms had agreed to develop a series of lower-priced EVs based on a new joint platform, producing potentially millions of cars from 2027, according to the article.

"After studying this for a year, we decided that this would be difficult as a business, so at the moment, we are ending development of an affordable EV," Honda CEO Toshihiro Mibe told Bloomberg.

The announcement comes after GM executives during the automaker's third-quarter earnings call said they're delaying several EV launches.