British inventor James Dyson has cancelled a plan to build an electric car, saying the project was not commercially viable.

The electric car and accompanying battery technology were the centerpiece of a $3.1 billion investment.

"The Dyson Automotive team has developed a fantastic car; they have been ingenious in their approach, while remaining faithful to our philosophies," Dyson said in an email to staff.

"However, though we have tried very hard throughout the development process, we simply can no longer see a way to make it commercially viable."

Operations in the UK and Singapore will be hit by the decision.