The decision is in part due to GM's new approach to turn Pontiac into a "niche brand" as outlined in a plan it submitted to Congress last year.
As a result, GM considers the G8 ST to be a low-volume niche product which doesn't meet the requirements of the restructured Pontiac brand - with no plans to introduce the vehicle for another GM brand.
"With Pontiac being more focused on sporty, fun-to-drive cars, we took a long look at the ST and it didn't fit with what our future vision of Pontiac would be," said Pontiac spokesman Jim Hopson. "At that point, we decided to not proceed with this vehicle."
Based on the Holden VE Ute, the new G8 ST was to debut early this year alongside its Australian sibling - the G8 sedan, which was launched in March 2008.
"The way the business is today, we want the dealers to focus on the great products we do have: the G6 sedan and the Vibe," Russ Clark, executive director of product marketing for Pontiac, Buick and GMC, said.
This sentiment certainly does not bode well for Holden, reaffirming the idea that the viability of the G8 sedan in the US market is also in question.
"We'll be bringing the entries down in Pontiac," Clark said. "It's six right now. It'll be less than six but more than one, so what it'll be ultimately? We're working on that now."
Previous trends indicate this number is likely to be less rather than more, with GM previously having restructured Buick from having seven nameplates in 2005 to three now.
Holden spokesman Jonathan Rose said the cancellation of the G8 ST export would not impact on production schedules or jobs at the Elizabeth plant.
"The decision doesn't alter the foundations of our export program," he said. "It would have been an extension of the export program. That now won't occur."
Holden will continue production of the G8 Sedan, G8 GT and newly introduced G8 GXP for the U.S. market where around 15,000 have been sold so far.
Rose has said the decision is as a result of Pontiac becoming a niche sports car brand, with GM deciding the G8 ST did not fit that image.