Shipping giant Matson declared last week that it would no longer transport electric vehicles (EVs) or plug-in hybrids on its vessels, citing the fire risks posed by lithium-ion batteries. This decision, effective immediately, followed the catastrophic sinking of the carrier Morning Midas earlier in June. The blaze, which aerial imagery showed billowing from the ship’s stern, underscored the perilous nature of lithium-ion battery fires — intense, almost impossible to extinguish, and prone to reignition.

Lithium-ion battery fires, as seen in incidents like the Morning Midas, Felicity Ace (2022), and Fremantle Highway (2023), are a unique hazard. These fires, driven by thermal runaway — a rapid, self-heating reaction — burn hotter than conventional fires, produce toxic gases and can reignite days or weeks later. In response, some German cities have banned EVs from underground parking due to fire risks, and a Norwegian ferry operator has prohibited them outright.

Matson’s move is a stark symbol of a broader reckoning: the electric vehicle revolution, once heralded as the inevitable future of mobility, has come full circle. Like a Rorschach test, the EV experience has exposed its hollow promises, revealing a deeper pathology in Western society’s obsession with ‘green’ ideals.

The False Promises of EVs

Just a few years ago, the narrative was unambiguous. EVs were heralded as the vanguard of a clean, renewable future, poised to banish the polluting tailpipes of internal combustion engine (ICE) vehicles to the ash heap of history.

Every major automaker — from General Motors to Volkswagen — proclaimed ambitious plans to pivot entirely to electric fleets by the 2030s. General Motors, a leading force in the automotive industry, had “committed fully to an all-electric future”, EV Magazine claimed as recently as August of last year. By June of this year, however, Politico reported that “General Motors quietly closed the door this week on a goal to make only electric vehicles by 2035”.

The shine was coming off the EV narrative even before the onset of President Trump’s energy counter-revolution this year with his ‘energy dominance’ and ‘drill, baby, drill’ agendas to end the Obama and Biden mandates and subsidies for favoured ‘green’ industries including EVs. Sweeping tax and budget legislation approved by Congress in the ‘Big Beautiful Bill’ will end the $7,500 tax credit for buying or leasing new electric vehicles and the $4,000 used EV credit on September 30th.

In March 2024, CNBC published a widely cited article entitled ‘EV euphoria is dead. Automakers are scaling back or delaying their electric vehicle plans’. The outlet’s automotive industry reporter Michael Wayland wrote:

For years, the automotive industry has been in a state of EV euphoria. Automakers trotted out optimistic sales forecasts for electric models and announced ambitious targets for EV growth. … Now the hype is dwindling, and companies are again cheering consumer choice. Automakers from Ford Motor and General Motors to Mercedes-Benz, Volkswagen, Jaguar Land Rover and Aston Martin are scaling back or delaying their electric vehicle plans.

Governments, particularly in the West, fuelled the EV frenzy with hefty subsidies, tax credits and mandates, while environmental activists hailed EVs as the moral choice to ‘save the planet’. To many, the allure was seductive: silent, smooth-riding vehicles that emit no tailpipe pollution with the promise of lower running costs. They offered affluent Gaia worshippers a ‘guilt-free’ driving experience. Yet, as Matson’s decision signals, the EV dream has collided with harsh realities — economic, environmental and practical — that no amount of propaganda or subsidies can obscure.

The EV narrative is built on a foundation of optimistic assumptions which have crumbled under scrutiny.

Take the ‘range anxiety‘ that afflicts many potential EV customers. Despite advances in battery technology, EVs still struggle to match the convenience and reliability of ICE vehicles for long-distance travel. The time required to charge — often 30 minutes to several hours, depending on the charger — compares unfavourably to the five-minute refuelling of a car run on gasoline or diesel.  

In most countries, charging infrastructure, while expanding, remains unevenly distributed, with rural areas and even some urban centres woefully underserved. Planning a long distance journey in an EV often feels like a logistical puzzle, requiring meticulous mapping of charging stations and contingency plans for delays or outages. This inconvenience has not gone unnoticed by consumers, who increasingly view EVs as a hassle rather than a liberation.

Every now and then, news of battery technology ‘breakthroughs’ gets reported with hopes of EV nirvana around the corner. For example, a story in CarNewsChina published last month reported that “Huawei has stepped up its ambitions in advanced energy storage with a patent for a sulphide-based solid-state battery that offers driving ranges of up to 3,000 kilometres and ultra-fast charging in just five minutes”. Amateur scientist Willis Eschenbach and expert debunker of magical thinking in energy physics reacted to this story in his inimitable way: “But, as usual, reality is hiding out in the fine print, ducking the spotlight while the PR machine does its victory lap. Nobody wants to talk about physics. Nobody asks how, exactly, you’re supposed to pour Niagara Falls through a garden hose.” He was referring to the impossible physics underlying the claims of “ultra-fast charging” by Huawei.

The economic case for EVs has also faltered. Proponents claimed EVs would be cheaper to own and operate, but the reality tells a different story. Higher upfront costs of EVs relative to ICE vehicles, typically 30-40% higher, were only partially bridged by subsidies such as the generous $7,500 federal tax credit in the US under the Obama and Biden administrations which, as already noted, are slated to end shortly.

EVs depreciate more rapidly than conventional vehicles, with some models losing up to 50% of their value within the first two years. Battery replacement costs can reach $30,000, further diminishing resale value. Insurance costs are reported by some to be exorbitantly more expensive. In the UK as elsewhere, the second-hand market for EVs has collapsed, with resale values plummeting as consumers shy away from used batteries with uncertain lifespans and as car companies keep discounting prices on newer models as sales start to slow. Car rental companies like Hertz have suffered massive losses after investing heavily in EV fleets, only to find them depreciating rapidly and sitting idle due to lack of demand.

The latest data on global EV sales present a mixed picture. Year-to-date January to May 2025 global EV sales grew by 28% over the same period last year. This might suggest that overall, despite the many news headlines about struggling car manufacturers faced with slowing sales figures, the EV transition to electric mobility is still robust.

Yet, a quick glance at the data by regional breakdowns shows that the EV story is overwhelmingly a China-focused one. Europe bought 1.6 million more cars in 2025 so far relative to the same period last year, or 27% more. North Americans bought only 0.7 million more, or 3%. The ‘rest of the world’ bought 0.6 million more EV units or 36%. China alone accounted for 4.4 million new EV units, logging a growth of 33%. To call what is essentially a China-dominated story a global EV success story is a sleight of hand.

Given the opacity of China-related news, it is not clear what to make of reports about vast ‘graveyards’ of unsold EVs in various cities. A Bloomberg article in 2023 reported that “a subsidy-fuelled boom helped build China into an electric-car giant but left weed-infested lots across the nation brimming with unwanted battery-powered cars”. A report published on Friday warned that “the Chinese auto industry is a bubble about to burst after years of artificially inflated sales and brutal price wars. The scheme involves registering new vehicles in China and then selling them abroad as used vehicles despite being essentially ‘zero-mileage’ cars. This allows carmakers to report high sales numbers even though the market is on the brink of collapse.”

Indeed, inflating EV sales figures is not restricted to China. Geoff from Geoff Buys Cars reveals how EV sales numbers are artificially inflated in the UK. Thomas Shepstone of the Energy Security and Freedom Substack explains it as follows:

Historically, some dealers have registered vehicles to themselves or their dealership to meet sales targets set by manufacturers, qualify for bonuses or clear inventory. This can temporarily inflate reported sales figures, but these vehicles often end up as demo models, loaners or used inventory, not actual consumer sales. … For EVs, the high cost (average transaction price of $56,351 in Q3 2024) and uneven consumer demand could incentivise such behaviour, especially for brands struggling to move EV stock.

As pointed out by David Blackmon is his widely read Energy Transition Absurdities Substack, the other striking take-away from the graph is the much lower sales this year overall from the peak in December 2024. Blackmon states: “What this chart starkly reveals is that the global EV industry has suffered a dramatic drop in sales this year, from almost two million in December 2024 to a bit less than 1.6 million in May 2025. That’s a collapse of 20% in sales in just 150 days or so.”

It might be argued that comparing December to May sales figures may be misleading and that the second half of this year might surprise on the upside. Few would want to bet on this presumption. Certainly, most of the auto manufactures who have the most to lose (or gain) financially, as we have seen, are scaling back.

Dirty Secrets of Clean EVs

The environmental argument, the cornerstone of the EV push, is equally shaky. Advocates claimed EVs would slash CO2 emissions, but lifecycle analyses reveal a more complex picture. Manufacturing EV batteries requires energy-intensive mining and processing of rare earths and minerals like lithium, cobalt and nickel. In countries like the Democratic Republic of Congo, cobalt mining by informal enterprise has led to environmental devastation and harsh employment practices including child labour.

The carbon footprint of producing an EV far exceeds that of an ICE vehicle, meaning drivers must log tens of thousands of miles before an EV becomes ‘greener’ – and that’s assuming the electricity grid is powered by renewables rather than natural gas and coal. In many regions, it isn’t. The International Energy Agency notes that over 60% of EVs sold in Mexico in 2023 and 2024 came from China, where coal-heavy grids undermine the ‘clean’ narrative.

While EVs eliminate tailpipe emissions, their heavier weight and faster acceleration increase particulate emissions from tire wear. Studies suggest that tire emissions can significantly exceed tailpipe emissions, contradicting claims of overall environmental benefits from EV adoption. The smallest tire particles, measured in nanometres, can enter lungs and spread into organs. Various tire components have been linked to chronic conditions including respiratory problems, kidney damage, neurological damage, and birth defects — a particular concern in low-income neighbourhoods adjacent to highways.

There are indirect costs of electric vehicles as well that, while not included in the cost an individual owner pays, are borne by the country. The most significant of these is the additional wear on infrastructure from EVs. Heavier vehicles on roads have negative consequences, and EVs are far heavier than their conventional vehicle counterparts. Heavier vehicles cause more damage to roads and bridges. Heavy EVs also pose a threat of parking structure collapse in older or less maintained carparks.

Not enough attention is paid to the fact that ICE vehicles have made remarkable strides over the past half-century in reducing emissions of actual pollutants. Sulphur oxides, nitrogen oxides, lead, mercury and ozone have been curtailed through cleaner fuels, advanced engines and scrubber technologies. Ambient urban conditions have improved markedly from the smog-filled cities typical of the 1950s and 60s. The ‘pea-soup‘ fogs of 1950s London are now a thing of the past.

It is also not widely reocgnised that carbon dioxide, often vilified, is not a pollutant but a trace gas essential for photosynthesis and life itself. The obsession with EVs, then, is less about economics, health or climate, properly understood, and more about a cultural pathology that ignores trade-offs and practicalities.

The Business World’s Retreat

The business world, once all-in on EVs, is now retreating. Major automakers like Ford, General Motors and Volkswagen, which once pledged to phase out ICE vehicles, are scaling back EV investments or halting new projects. In February 2025 it was reported that Ford Model e, the company’s electric vehicle division, had an earnings before interest and taxes (EBIT) loss of $5.1 billion in 2024 after losing $4.7 billion the year before.

A Politico report last month noted GM’s shift in investment focus consistent with a more pragmatic, market‑aligned strategy reflecting a reinforcement of gasoline‑engine investments and a broader step-back from all‑EV ambitions. This includes slowing the conversion of key factories to EV production in response to softening demand. Volkswagen’s CEO admitted in 2025 that the company’s EV push was “overly ambitious”, citing weak demand and supply chain issues. He called for greater flexibility in the European Union’s plan to ban sales of new combustion engine cars by 2035, warning that “the transition to fully electric vehicles may not happen as smoothly as expected”. He urged EU politicians to carry out a “reality check” and assess how fast electric vehicles are actually being adopted across member states.

Toyota, the one major outlier among large automotive companies with its cautious focus on hybrids, has emerged relatively unscathed, its strategy vindicated as consumer preference for hybrids grows. About four or five Chinese manufacturers, propped up by state subsidies, and Tesla are among the few still profiting from EVs. Even Tesla’s margins are under pressure as competition intensifies.

The Trump administration’s energy policy shift has accelerated this reversal, going beyond just dismantling subsidies for EVs and other ‘favoured’ renewables. US regulators have waived fines for automakers failing to meet fuel efficiency standards dating back to the 2022 model year, following a new law signed by President Donald Trump. This move, part of a tax and budget bill, puts an end to fines under the Corporate Average Fuel Economy (CAFE) rules established by a 1975 energy law enacted to address a different ‘problem’ (the Arab oil embargo)

After yanking the ‘pull’ factor (taxpayer-financed subsidies) and the ‘push’ factor (the CAFE standards which became increasingly punitive on gasoline and diesel vehicles), Trump also signed a congressional resolution last month that overturns a California state rule that would have phased out the sale of new gas-powered cars by 2035. The California rule and the decision to revoke it are a major deal for the US auto market. The state makes up about 12% of the US population and its rule has also been adopted by 11 other states and Washington, D.C.

A Rorschach Test for the West

The EV story is a cautionary tale of hubris and misplaced priorities. The promise of a clean, cost-effective and convenient future is seductive, but it ignored the complexities of battery production, mineral supply chains, infrastructure and safety. The environmental costs of mining, the economic burden of subsidies and mandates imposed to ‘save the climate’, and the practical limitations of range and charging have dismantled the myth of EVs as a panacea.

The natural market for EVs, brilliantly exploited by Elon Musk, was always the affluent ‘luxury beliefs‘ class of EV proponents and buyers who could afford having these status symbols as their second or third car. But to be a viable business, EVs had to be embraced by many more in the aspiring middle classes. EVs had to be seen as a rational response to both pollution and a belief that they would actually cost less to run once ‘all the costs’ were accounted for. In the ESG universe, this was called ‘doing well by doing good‘.

But, like a Rorschach inkblot, it now transpires that EVs reveal more about our desires than our realities. It was sold as mankind’s solution to poor urban air quality and man-made global warming – the former affecting the daily health of majority urban dwellers and the latter leading to an impending climate catastrophe for us and our children. Perhaps the love affair with the EV is a projection of Western guilt and idealism in the Church of Climate — a topic for experts on Western ‘mass formation‘ psychology.

As the auto industry pivots back to hybrids and ICE vehicles, and as shipping companies like Matson draw a line in the sand, the EV revolution stands exposed as another climate virtue narrative. The path forward lies not in ideological crusades but in pragmatic solutions — cleaner ICE technologies, robust hybrids and, for EVs, rigorous safety standards and transparent lifecycle assessments. Cars once again need to make sense for sovereign consumers spending their own money, without the carrots and sticks of intrusive government policies supposedly based on ‘The Science’.

Dr Tilak K. Doshi is the Daily Sceptic‘s Energy Editor. He is an economist, a member of the CO2 Coalition and a former contributor to Forbes. Follow him on Substack and X.