Is it okay/possible to quit a PhD program in the 4th year and apply someplace else? I am a 4th year PhD student in Mechanical Engineering at a Tier 1 University. I have joined the current research group due to funding reasons but never really liked the project. The project is not academic in nature (Not possible to get any decent publications, no design or innovation aspects), more like the sponsoring company had an engineering problem that needed a solution.

My advisor is a good person but he is not an expert in this field and not sure why he accepted the project. I have struggling for some time and my hate towards the project has recently increased and I feel that I cannot carry on with research anymore. I tried speaking to my advisor but he did not like the fact that I was belittling the project, and said I was ungrateful towards him even though he funded me.

That coupled with scare of poor job prospects in mechE have been haunting me. I am also sacred that if I tough it out and finish I might end up being overqualified for industry.

Did anyone else face a similar problem? Would like to know how acceptable is it to leave a PhD program in the 4th year and apply to a different program?

EDIT: Thanks for the answers everyone. I probably should have given more background information. I was unable to secure any funding in my first year (spent time doing courses on my own dime) and towards the beginning of my second year I was ready to accept whatever project came my way and chose this project when there was an availability. 

The project was a collaboration between a simulation group (Prof. B) and a mechanical testing group (My advisor's, say Prof. A) and was already halfway through when I joined. Prof. B was the lead PI and had dictated the terms and I spent the next few years just doing the required testing for simulations. Regarding the project (can't name it due to privacy concerns), it has very little academic value, we were able to get out only one article in a low impact journal in the entire duration of the project of which I am the second author. People in my lab usually publish 4 journals for graduation. The project was also very hectic with meeting the sponsors twice a week. It felt more like working in a company and the skills I acquired are more of a master's level.

That is the reason I called it overqualified (a PhD with Masters level skills). I had tried a few times to change the project but was met with resistance from my advisor and I did not oppose strongly for fear of being fired. Now I am really scared of job prospects. I understand that I am responding very late. I did speak to a few people in the department and most are suggesting it is stupid to start another PhD at this stage. Another option I was suggested is quitting with a Master's and finding a job. Frankly, I am not sure what to do.
Yes, it is is a bad idea.  (I will give you a definite answer.)

You need to finish up.  You are too far down the road.


It is very natural to be close to the end and look at your Ph.D. and think you could have done more ("I coulda been a contender.")  But you need to resist the impulse.  The first 3 years are sunk. You can't go back.
You have the rest of your life to do useful science.  Just collect the sheepskin (even if your advisor wasn't that smart or your project that momentous.)  You can go after good future work just as easily with a Ph.D. as without one.  In many ways easier and at at least marginally higher pay.  
Your goal is to be an independent researcher.  It is normal for grad students to transition to this during their career.  Some of them lag and still need supervision as postdocs, but some are basically great indepedent scientists halfway through the Ph.D.  Do NOT hang out in the comfortable quasi-adolescent world of studentdom.  Get that Ph.D. to show you are an independent thinker (it is the credential for that) and move on.
There are a LOT of ways that a new Ph.D. could go wrong. (bad advisor, money, experiments not working, etc.) Yeah, this guy is a nebish.  But at least you are not working with a jerk (and there are plenty of tin pot dictators in academia).  Count your lucky stars and just move on and do your own thing.  Sure he wasn't the perfect father figure mentor. But you need to do your own thing.  Maybe you can be a better mentor for others when it is your turn or you can be a better scientist/engineer.
It WILL look bad that you made this switch, especially at this stage in your career.


Net/net:  let the dissatisfaction (very common, I had it too) to be motivation to finish early.  Not to try to recreate a better experience and stay longer.  

Anecdote:  I had same feelings during my Ph.D.  Was basically done with my work 2 years in but dissatisfied...advisor was nice but not a cutting edge scientist.  We got along mostly but clashed at times since I really didn't need him for anything.  He gave me one fair piece of advice (graduate early), but I failed to take it.  Hung out for 4 years and did an extra project when I really could have been out in 3 (or faster).  And I had money saved from previous work.  And it is a nice lifestyle in some ways to be a grad student (beats working).  But same time, it was a waste...should have moved on faster.  

You are actually putting yourself in way more danger by moving to something new and having some 7 year plus of Ph.D. time.  Even from a personal perspective you are not getting any younger and you won't have the same fire in your belly at 50 as at 30.  Move on and don't spend your whole youth in student-dom.