The Indian manufacturer grounded all four cars during qualifying; Nico Muller, Oliver Rowland, Lucas di Grassi and Kelvin van der Linde did not leave the garage at any point as Mahindra assessed its options to determine if it could take part.
It was later confirmed that Mahindra would not continue with the weekend in Cape Town, citing that it had concerns about the integrity of its rear suspension package - which it also supplies to the Abt squad as part of its associated powertrain deal.
"Mahindra Racing Formula E team have confirmed their withdrawal from the ABB FIA Formula E World Championship qualifying sessions and race in Cape Town due to rear suspension safety concerns," the team stated on Twitter.
"A thorough investigation on the suspension elements of the Mahindra M9Electro race cars will take place on the team’s return to the UK. This decision also affects their customer team Abt Motorsport.
"The safety of our drivers and extended teams is of utmost importance."
Abt published an identical statement, and the withdrawal of both teams means that a maximum of 18 cars will take to the start of the inaugural race in Cape Town.
This is a bitter blow to van der Linde, who had been the focus of local attention ahead of his home race in South Africa.
Mahindra team principal Frederic Bertrand confirmed to Autosport that the team was alerted to an issue with its rear suspension package by a mechanic after the second free practice session.
Although the team had hoped that it could enact a fix and allow its drivers to participate, Mahindra elected to offer a safer approach.
"From there it was about working out the right way to do it," Bertrand said. "It was a heartbreaking decision to make."
Bertrand added that the team would investigate the components in order to clarify if it was "a mechanical or procedural issue", citing that the bumpiness of the Cape Town circuit may have been a factor.
Mahindra is currently seventh in the teams' championship with 26 points, courtesy of di Grassi's third place in Mexico and a sixth-placed finish for Rowland in Hyderabad.
Abt, meanwhile, has been so far unable to get off the mark having started the season behind its rivals - as van der Linde was due to continue his cover for the injured Robin Frijns.