Car carrier adrift and on fire in Atlantic

Updated: Monday 21 February

VOLKSWAGEN Group vehicle deliveries into the US have suffered a further disruption after a giant car carrier loaded with thousands of vehicles caught fire near the coast of the Azores last week. What’s more, the nature of the fire has made attempts to extinguish the blaze very difficult.

The Felicity Ace, a car carrier chartered by the Volkswagen Group, departed the port of Emden, Germany on February 10 and was scheduled to arrive in Davisville, Rhode Island, on February 23. The fire forced the evacuation of the ship’s crew of 22 by the Portuguese navy and Ponta Delgada Maritime Search and Rescue Coordination Centre. There were no reported injuries.

On board of the 17-year-old roll-on/roll-on vessel, which sails under the Panamanian flag, are a total of 3965 new vehicles including Volkswagen models, approximately 189 Bentleys, 1100 Porsches, and “a number of Lamborghinis”, a Volkswagen Group spokesperson said. 

It is understood the ship’s Japanese owners, Mitsui OSK Lines, has arranged for the Felicity Ace to be towed – towing boats were on route from Gibraltar and the Netherlands, with three due to arrive by Wednesday. In the meantime, a 16-person salvage team from Smit Salvage, owned by Dutch marine engineer Boskalis, was sent to the ship to help control the flames. 

Unfortunately, "the intervention (to put out the blaze) has to be done very slowly," João Mendes Cabeças, captain of the port in the Azorean island of Faial, told Reuters. "It will take a while."

Mr Cabeças said because traditional water extinguishers could not stop lithium-ion batteries from burning, the EVs’ components were "keeping the fire alive," adding that specialist equipment to extinguish the blaze was on the way. It was not clear what had started the fire.

Mr Cabeças had previously said that "everything was on fire about five meters above the water line" and the blaze was still far from the ship's fuel tanks. It was getting closer, however, he said.

"The fire spread further down," he said, explaining that teams could only tackle the fire from outside by cooling down the ship's structure as it was too dangerous to go on board.

It is expected that the unfortunate incident could have long-reaching implications on already depleted inventories of Volkswagen Group brands in the United States. Late week, US economist Patrick Anderson told Automotive News he estimated the loss at about $282 million ($A 393 million), although that number may turn out to be conservative, given the extent of the blaze.

"Looking at the entire cargo, assuming that three-fourths of the vehicles are a total loss, and averaging the wholesale value at a lower amount, suggests this involves about $376,675,000 worth of cargo. Probably three-fourths of that, or $282,506,250 is a total loss.

"Again, we do not have a good assessment of the degree of damage to the cargo from any inspection, but fire, water, smoke, and submersion damage are all overlapping likelihoods.

"These amounts do not include the downstream loss at dealers. It also doesn’t include any salvage, environmental, or other costs, nor the ship itself, nor any lost wages of the crew or costs to the Portuguese that rescued them," he added.

It is the second similar incident for the Volkswagen Group in the past three years. In 2019, a similar carrier known as the Grande America caught fire and sank with over 2000 vehicles on board – including a substantial number of Audi and Porsche models.