| Thanks for reading Hyperdrive, Bloomberg's newsletter on the future of the auto world. You could be forgiven for thinking that, in back-to-back years, two huge ships carrying thousands of cars have gone up in flames because of battery-electric vehicles. But you'd be jumping to premature conclusions, and possibly wrong. The trouble for the EV industry is that these rushes to judgment keep happening and will need to be deftly navigated through to maintain its momentum in decarbonizing transport. Since a ship named Fremantle Highway caught fire off the Netherlands coast last week, countless headlines have suggested EVs might have been the culprit. While an inexperienced spokesperson assumed this to be the case soon after the blaze broke out, the coast guard later clarified that the cause remains unclear.  The Fremantle Highway vessel in the North Sea. Source: Netherlands Coast Guard There are precedents that might help explain why the Fremantle Highway fire is being covered this way in the media. Months after another ship, called Felicity Ace, went up in flames early last year off the coast of the Azores islands, German insurer Allianz warned that lithium batteries were an emerging risk for container ships and car carriers increasingly transporting EVs. While electric Porsches and Volkswagens were among the roughly 4,000 vehicles aboard, it's unknown whether batteries actually were to blame. Investigating the cause was complicated by the ship sinking before it could be towed to safety. Also not helping matters: isolated cases in which batteries have caught fire since Tesla was just getting off the ground. Back in 2011 — before the Model S was in production — US auto-safety regulators started asking questions about battery risks after a Chevrolet Volt plug-in hybrid burst into flames while parked at a National Highway Traffic Safety Administration testing center. NHTSA closed its investigation months later, saying EVs pose no more fire risk than other cars. Tesla CEO Elon Musk has gone a step further, arguing EVs are much safer and expressing exasperation after a Model S spewed smoked and caught fire in a Shanghai parking garage in April 2019. "Over a million combustion engine (it's right there in the name!) car fires per year & thousands of deaths, but one Tesla car fire with no injuries gets biggest headlines," Musk wrote at the time on Twitter. In another post on the social media platform now called X, he claimed EVs were "over 500% *less* likely to catch fire than combustion engine cars, which carry massive amounts of highly flammable fuel. Why is this never mentioned?" In Norway, where EVs dominate new-vehicle sales, authorities investigated a major fire that broke out in a car park at Stavanger airport in early 2020. The blaze, which damaged hundreds of vehicles and led to the temporary closure of the airport, was initially reported to be caused by an EV. It turned out the cuplrit was a combustion-engine Opel Zafira. Whether batteries were at fault in the cases of the Felicity Ace or Fremantle Highway blazes or not, the United Nations agency responsible for measures to improve the safety and security of international shipping last year considered a proposal to evaluate the adequacy of fire protection, detection and extinction arrangements in car carriers. An International Maritime Organization safety committee is now evaluating these issues. It also can't be ignored that firefighters have found battery fires can be prone to reigniting because of self-oxidizing lithium salts that prevent them from being starved out. Extinguishing them can take thousands of gallons of water, much more than what it takes to stop a gasoline car fire. But even as he expressed concern that EVs pose a serious hazard, the head of the World Shipping Council acknowledged the trade association representing the international liner-shipping industry is working with less information that it would like. "We need to have a solid scientific basis to understanding the risks in order to find the best way to limit them," John Butler, the council's president, said in an emailed statement to Bloomberg. The hazard "needs to be tackled at its root." — With Brendan Murray and Monica Raymunt. In the latest episode of Bloomberg's Odd Lots, Joe Weisenthal and Tracy Alloway speak with BloombergNEF's Corey Cantor about the competition between Tesla and BYD, China's broader EV strategy, the worldwide battle over batteries and the impact of the Inflation Reduction Act. Listen on Apple Podcasts or Spotify.  An employee placing a brake-system module in a container on the production line at Continental's plant in Frankfurt. Photographer: Ben Kilb/Bloomberg It's been an extraordinary few years for automakers earning record profit margins. But for the suppliers of everything from the wiring to the sealing systems and thermal insulation that go into cars, it's been "a daily fire drill," said Michael Robinet, an executive director at S&P Global Mobility. Their struggles offer a window into one of the cruel realities of the great inflation surge that's reshaped the global business landscape: while some companies have been able to capitalize on rising prices, others have had little choice but to bear the brunt of higher costs, often accumulating mountains of debt in the process. | 
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