Ship sinks! 4000 new cars burn! Auto giant faces double claims
2024-03-13 09:00
German automotive giant Volkswagen Group is facing double claims from shipping companies and insurance companies over the fire and sinking of the car carrier Felicity Ace two years ago, resulting in the total loss of 4,000 new vehicles.
According to the Nikkei, the operator of the Felicity Ace, Mitsui O.S.K. Lines (MOL), has confirmed that it has filed a lawsuit against Porsche, a luxury car brand under Volkswagen, claiming that the fire on the Felicity Ace was caused by "lithium-ion batteries in Porsche electric vehicles".
The lawsuit was filed in the Stuttgart District Court in southern Germany, where Porsche is headquartered. The court stated that the claim amount is €30 million (approximately RMB 236 million).
MOL believes that Porsche failed to inform them of the risks and necessary precautions for transporting electric vehicles. In response to MOL's accusations, Porsche claims that because the Felicity Ace sank to a depth of 3,000 meters after the fire, salvage is difficult, and therefore the cause of the fire has yet to be determined.
Meanwhile, according to Bloomberg, Allianz has also filed a lawsuit against Volkswagen Group in Germany. A Volkswagen spokesperson stated, "Due to the ongoing nature of these lawsuits, we are unable to comment on further details at this time."
Volkswagen Group stated that media reports suggest the Felicity Ace fire was related to electric vehicles, but this claim has not yet been confirmed by the court.
It is understood that the Felicity Ace (built in 2005) was a 6,400-vehicle car carrier of MOL. On February 16, 2022, the ship caught fire approximately 90 nautical miles southwest of Faial Island in the Azores. The fire burned for nearly a week before being largely extinguished, but the ship eventually sank on March 1 of the same year while being towed.
At the time, there were reports that the lithium-ion batteries of the electric vehicles on board the Felicity Ace caught fire, making firefighting very difficult. However, the Dutch professional maritime salvage company Smit Salvage, involved in the rescue, stated that it is still unclear whether the fire was related to electric vehicles, but it is well known that lithium batteries are prone to fire, and the large number of batteries on board caused the fire to spread rapidly, making it impossible to extinguish with water alone.

The sinking of the Felicity Ace resulted in nearly 4,000 vehicles on board sinking to the bottom of the sea. It is understood that at the time of the incident, there were 3,965 Volkswagen Group vehicles on board, including a large number of new Volkswagen brand vehicles, as well as 1,100 Porsches, 189 Bentleys, and a small number of Lamborghinis.
Experts estimate the total value of the cargo on board to be US$438 million (approximately RMB 3.149 billion), of which US$401 million (approximately RMB 2.883 billion) was for cars and freight vehicles. This accident is expected to cause losses of at least US$155 million (approximately RMB 1.114 billion) for Volkswagen Group brands, including Volkswagen, Porsche, Audi, and Lamborghini.
Allianz points out that fires have become a major driver of losses for car carriers, with vehicle malfunctions or short circuits potentially causing cargo hold fires, while open decks facilitate rapid fire spread.
Allianz stated that the surge in sea transport of electric vehicles undoubtedly presents more challenges, as existing countermeasures may be insufficient to effectively address fires involving electric vehicles. The economic losses from such accidents are enormous, including the value of the car cargo and costs associated with wreck removal and pollution control.
Allianz's investigation data shows that there were 209 ship fire accidents in 2022, the highest in ten years, a 17% increase compared to 2021. Thirteen of these occurred on car carriers, but how many involved electric vehicles is currently unclear.
The International Union of Marine Insurance (IUMI) opposes Allianz's view. In a report released last August, IUMI stated that electric vehicle fires are not more dangerous than gasoline vehicle fires, and there is currently no evidence to suggest that electric vehicles are more prone to fires than gasoline vehicles.
IUMI stated that the risk of electric vehicle battery fires is not high, but there is indeed a risk of thermal runaway and reignition, so different safety management is needed compared to gasoline vehicles.
In addition to the Felicity Ace, in July last year, the car carrier Fremantle Highway, operated by Kawasaki Kisen Kaisha, caught fire in Dutch waters. The fire burned for more than a week before being extinguished. This ship carried 3,783 vehicles, all new cars, with no used cars, including as many as 498 electric vehicles. There were 23 crew members on board at the time of the incident, and the accident resulted in the death of one Indian crew member and injuries to several others.
To prevent such accidents from happening again, in October last year, MOL decided to install cameras and an artificial intelligence (AI) system provided by the Israeli company Captain's Eye in the cargo holds of its ten LNG dual-fuel car carriers under construction to provide early fire detection capabilities. MOL also plans to install this system on existing vessels.
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