The market demand for all-electric cars envisioned by Toyota Motor Corporation has not materialized according to the company, forcing it to shed a projected battery-powered minicar line.

The company is taking a different tack than its counterparts at General Motors or Nissan, planning to offer only 100 eQ all-electric vehicles in the US market. Toyota projected sales of “several thousand” in 2010.

According to Reuters, Toyota has seen the writing on the wall:

“Two years later, there are many difficulties,” Takeshi Uchiyamada, Toyota’s vice chairman and the engineer who oversees vehicle development, told reporters on Monday.

By dropping plans for a second electric vehicle in its line-up, Toyota cast more doubt on an alternative to the combustion engine that has been both lauded for its oil-saving potential and criticized for its heavy reliance on government subsidies in key markets like the United States.

“The current capabilities of electric vehicles do not meet society’s needs, whether it may be the distance the cars can run, or the costs, or how it takes a long time to charge,” said, Uchiyamada, who spearheaded Toyota’s development of the Prius hybrid in the 1990s.

Instead, Toyota will focus on its successful line of hybrid gas-electric vehicles, including the hybrid Prius.

Limited vehicle range and high costs have made pure electric models less attractive to consumers and thus dampening demand, Reuters said.

The evidence suggests that the issues consumers have with pure electric vehicles is not isolated to the US market.

Even the successful Prius hybrid brand’s plug-in models are failing to reach their sales targets in Japan—achieving only 20 percent of the 35,000 to 40,000 vehicles the company expected to sell this year.

It’s not just disappointing news for Toyota.

In an attempt to boost sales of the disappointing Chevy Volt electric vehicle, GM has offered steep discounts approaching $10,000 in August, or nearly 25 percent of the original vehicle price.  This does not include the federal tax credits of $7,500 that could further reduce the sticker price at the dealership.

GM refuses to release details on the discounts offered or the impact of the incentives in driving up sales of the Volt or in calculating the losses per vehicle, which the Washington Times estimated could be as high as $30,000, once development, manufacturing, and other production expenses are included and discounts added.