Airbus is cancelling its A320 freighter conversion programme, and has started to dissolve its partnership with Russian aerospace firms United Aircraft and Irkut.
The airframer cites "more demand" for passenger twinjets in the sector and not enough for the cargo version.
"Against the backdrop of these market changes and the increasing pressure on the [passenger-to-freighter] business case, the partners have concluded to stop and freeze the P2F programme," said Airbus.
It added that it had begun the "necessary legal procedures" to end the Airbus Freighter Conversion joint venture between the modification specialist EADS EFW and the Russian partners.
"Strongly growing passenger traffic results in high demand for used A320 family aircraft, reducing the amount of aircraft available for conversion," Airbus said.
Airbus Freighter Conversion was 32%-owned by EADS EFW while Airbus had 18%. United Aircraft and Irkut equally shared the other 50%.