Guest essay by Duggan Flanakin
Reprinted with permission from RealClearEnergy
Four hundred ninety-eight electric vehicles (EVs) and over 3,200 other vehicles, including 350 Mercedes Benzes, were bound for Egypt on the Fremantle Highway when one or more of the EVs caught fire, costing at least one seaman his life and injuring several others. Curiously, the Dutch coast guard had initially reported that only 25 of the vehicles were battery-electric models.
At last report, the Dutch coast guard admitted that it has been unable to put out the fire and that the ship has taken on water and is “listing” and on a trajectory toward a capsize. Should the ship sink, the total loss would also threaten the Frisian island of Ameland, part of a UNESCO World Heritage Site that is home to over 10,000 aquatic and terrestrial species and located near one of the world’s most important migratory-bird habitats.
On a global scale, of course, 3,000 vehicles are but a drop in the bucket, and in insurance terms, the loss of one 18,500–ton transport ship and one human life (all the wounded are expected to survive, despite broken bones, burns, and respiratory problems) is only so much. To compute a total cost, the ecological devastation would also have to be factored in, along with the cost of rescue, firefighting, and salvage operations.
But all in all, this was a freak accident, a one-off. This stuff never happens. Right?
Actually, it does. Just a year ago, the “Felicity Ace” sank as it was being towed from the site where 13 days earlier a fire had broken out on board. That ship, too, was transporting EVs and internal-combustion vehicles – including 15 Lamborghini Aventador LP 780-4 Ultimae supercars valued at half a million dollars apiece. Also lost were 1,117 Porches, 1,944 Audis, 561 Volkswagens, 189 Bentleys, and 70 other Lamborghinis.
And just a month ago, two firefighters died battling flames that broke out on another roll-on, roll-off (RORO) cargo ship docked at Port Newark in New Jersey. Firefighters arrived at the scene when just five to seven vehicles on the 10th floor of the ship were on fire, but the fire quickly spread to the 11th and 12th floors.
One commenter explained that on a RORO ship, vehicles are chain-shackled on all four wheels to the deck, creating trip hazards for firefighters. There are multiple decks, ramps, ladders, confined spaces, low overhead, and solid metal all around (like a gigantic oven). Fighting such fires is a very dangerous challenge, even if the deck plan of the ship is well known.
The port authority assured reporters that no EVs numbered among the 5,000 vehicles (bound for Africa) on board, but just imagine if the fire had begun with the ship far out at sea. Or imagine the horror should an EV fire break out on a ferry boat carrying hundreds of vehicles and thousands of passengers? Or in an underground parking garage in a New York high-rise?
Olivia Murray notes that automakers have largely replaced steel and metal with plastic, and that a huge fire could unleash immeasurable quantities of synthetic chemicals into the atmosphere from the burning plastic. A total capsize would send millions of pounds of debris and spilled motor oil (from the non-EV autos) to the sea floor along with any toxic flame retardants. The impact on sensitive marine life would not be known for years.
Even at $80,000 per vehicle (a low number, perhaps), the insurance loss for the nearly 4,000 vehicles on the “Felicity Ace” alone would be $320 million – and this does not include the loss to end-buyers of the opportunity to drive a vehicle that they may have already purchased.
But massive fires are not the only insurance concern with EVs. The New York Times recently reported the sad story of a Rivian owner whose electric pickup truck was involved in what would normally be considered “a minor fender bender.” The owner’s insurance company gladly offered to pay about $1,600 for the repairs, but the certified repair shop produced a bill for $42,000 – about half the cost of the vehicle.
The Times reporter explained: “A key reason is that the accident damaged a sleek panel that extends from the truck’s rear to front roof pillars.” To repair and repaint the vehicle, mechanics had to remove the interior ceiling material (the headliner) and the front windshield. Indeed, the State of New York’s consumer guide for auto insurance lists many models as “difficult-to-insure vehicles” simply because they are electric.
But that’s still better than the news reported in March that insurance companies are having to write off EVs with just a few miles – leading to higher premiums – because of the many EVs for which there is no way to repair or assess even slightly damaged battery packs after accidents. EV battery packs are ending up in junkyards in multiple countries.
According to the Agent Support Network of America, the intense impact of a crash can be much more devastating to EVs, increasing the likelihood of a totaled versus repairable car. EVs, according to Consumer Reports, may not withstand an accident as well as traditional gasoline-powered vehicles. EV batteries are vulnerable to damage, and with any indication of a compromised battery, insurance companies will likely declare an EV crash a total loss.
An overlooked insurance cost for EVs involves towing, which many insurance customers (and AAA members) take for granted as an inexpensive add-on to their policies. But EVs can be safely towed only on a flatbed truck with enough load capacity to handle the extra weight of the vehicle. Drivers are warned not to allow anyone to try to tow their EV with its wheels on the ground. Improper towing can damage, even total, the vehicle.
The higher costs for auto insurance only add to the already-higher costs of purchasing an EV, then procuring a personal charging station and spending more money to upgrade home wiring boxes (especially for older homes). The inconvenience of having your nearly new vehicle totaled – and then having to wait perhaps months for a replacement – further adds to the “buyer avoidance” that has frustrated those who demand an immediate end to the traditional gasoline-powered vehicles that most people around the world rely upon.
As automakers continue to lose money on EVs and consumers worldwide continue to prefer the vehicles they have learned to trust over decades, will EV mandates fall by the wayside – or will elites again double down, believing that “resistance is futile”?
Duggan Flanakin is a senior policy analyst for the Committee for a Constructive Tomorrow and a frequent writer on public policy issues.
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