Felicity Ace ship was carrying both electric and non-electric vehicles, and a fire broke out on the ship as it was travelling from Germany to the US, reports Insider.
While it's unclear exactly what started the fire, captain Joao Mendes Cabecas of the port of Hortas said lithium-ion batteries in EVs aboard the ship caught fire.
A salvage team was able to board the ship over the last weekend but to no avail.
The ship management company, MOL Ship Management Singapore, said the ship sank about 253 miles off the coast of the Azores, an archipelago in the mid-Atlantic that's an autonomous region of Portugal.
All 22 crew members were evacuated from the ship and were safe.
"The 22 crew members did not need medical assistance on arrival, having been taken to a local hotel. The owner of the ship 'Felicity Ace' is in contact with the logistic agent in order to draw up a plan for the towing of the ship," the navy had said.
The Felicity Ace ship was heading from Germany to a port in Rhode Island, the US, when it issued distress signals this week.
According to Importinfo.com, the electric vehicles may have been Audi E-tron Sportbacks.