Petter Solberg's title-winning PSRX Volkswagen Sweden team will not compete in the World Rallycross Championship in the 2019 season.
Having competed in every round of World RX to date and won four drivers' titles with Solberg and Johan Kristoffersson, triple FIA world champion Solberg's squad said it would 'pause' its involvement.
The team cited a lack of competition, following the departure of Peugeot's works effort, Olsbergs MSE and Mattias Ekstrom's Audi-backed EKS team in recent months.
"It's really sad, but the declining numbers of teams in the series makes it impossible for us to remain for 2019," said team principal Pernilla Solberg.
Having returned to rallycross for 2013 following his World Rally Championship career, Solberg won the first ever World RX event in Portugal in 2014, and claimed the first pair of drivers' titles to add to his 2003 WRC crown.
His team secured VW backing for 2017 and he was joined by Kristoffersson in a pair of World Rally Car-derived VW Motorsport-built Polo Supercars with which they dominated the series.
VW motorsport director Sven Smeets agreed with Solberg that recent exits from World RX meant continuing was not viable.
"In the past two years the competition in WRX between the cars from Audi, Ford, Peugeot and Volkswagen has been huge, resulting in fantastic sport with close racing between some of the most famous drivers in motorsport," said Smeets.
"Unfortunately, with the exit of three works or works-supported teams from World RX, the situation has changed dramatically.
"Together with PSRX and Volkswagen Sweden, we had to re-evaluate the involvement in the championship.
"We certainly didn't take the decision lightly, but we came to a mutual agreement not to continue in WRX in 2019 as there is huge uncertainty regarding the entries and the competition for next season."
VW was one of the key advocates of World RX's proposed switch to electric cars for 2021, and Smeets emphasised that his firm would continue to monitor that situation.
"Naturally, Volkswagen Motorsport will keep a close eye on any developments towards the electrification of the sport of rallycross," he said.
"From the beginning we have been supporters of this initiative and we continue to be interested."
The announcement leaves the champion of the last two seasons, Kristoffersson, without a drive for 2019.
Petter Solberg underlined that his squad is not permanently closing its doors and that he will continue to compete with VW in 2019, but is yet to give any indication as to where he will drive.
He recently returned to the WRC to take part in Rally Spain driving VW's new R5 Polo WRC2 car.
"We can all see the potential here, but it's just not sensible to continue for PSRX Volkswagen Sweden in 2019," he said.
"The important thing to understand here is that this is a pause - a pause and not an end.
"As a team, we continue and we work together. We can't say much about this now, but there will be more to talk about in the new year.
"I still believe in World RX. I still believe this championship can deliver the most sustainable, relevant, entertaining and competitive racing anywhere in the world.
"We work on the future and we look forward to sharing those exciting plans with you early in 2019 - and those plans include me being behind the wheel of a Volkswagen."