No, not abandoned. Just slow to implement!

I think that the main razon to abandon this approach is because the professors and the academic engineering program are not focus to work together this methodology. It is logic that students resists the PBL methodology because it implies more individual work and more responsibility, it is the case in my country. But at the end of the course they can observe the improves in their formation.

I have another experience. Students (in Egypt) just loved the change from traditional, teacher centered, reactive learning towards PBL, student centered, proactive learning.

My opinion is, that this has got to do with the CONTEXT. One of the results of the Arab Spring might be that students long for new skills like team work, presenting, project management, arranging meetings, autonomy; exactly these are trained through PBL. So, let us be clear: what country, what context are we talking about?

Attached an article (on medical biophysics, but results are similar to my engineering experiences).

Article An Approach in Medical Biophysics learning style using PBL method

PBL has been blamed to favour a more superficial learning,and misconceptions. But it's not enough to abandon PBL. The best way should be to combine PBL and traditional approach, and also to have tutors able to detect misconceptions and help students building right concepts. My doctorate research was about PBL and concepts' learning according to Vygotsky's concepts learning framework. As Vygotski said, the best way to make students learn concepts is not to teach concepts but to help them solve problems in their ZPD.

Problem-based learning should be the main mode of education, with lectures and seminars as minor support.  It is quite different from giving students projects.

Problem-based learning takes about 5 years to implement as a teaching method, primarily in training staff (and changing their perceptions) and changing the rooms from lecture theatres to ones in which students can work separately in small groups.  The whole course material must also be revised to determine the learning outcomes required and the problems which must be devised to produce these outcomes. 

It then suffers from the problem of not being easy to scale when there is a boom in demand.  For class sizes of 20 or so, you can make sure that each group has a different problem (in some important respects) so that they do not just copy.  For classes of 200 or so, it is very difficult to give unique problems to every group (which meet the objectives) and not to repeat them.

By contrast, you can pack more students into larger lecture theatres and give each of them the same exam marked by the same academic, so the traditional method has economic and practical advantages for the institution.

Even Project-Based Learning as a complementary part of a traditional course provides difficulties on the large scale, especially for practical subjects requiring hardware.

Projects for engineers are like rackets and balls for tennis players!

To this discussion, I would add the value of discovery-based learning which has some of the same benefits of PBL without quite as much overhead. DBL uses leading questions and more interaction between students and teacher than traditional lecture. This facilitates the students "discovering" the engineering principles rather than simply being given them.

DBL requires a shift for an engineering faculty member who may be more inclined to traditional lecture style classes or problem solving sessions and requires slightly different preparation. DBL can scale much more easily than PBL, though, and still puts the engineering knowledge in broader context similar to PBL.