Hybrid cars like the Prius emit less carbon than conventional cars. But they also depend on rare earth materials to make their engines work. And the mining of rare earth extracts a heavy toll on the environment in other ways.
China has most of the world's easily accessible rare earth (which isn't actually rare, just hard to find in concentrations that make extraction profitable), and it recently decided to cut off supply to other countries. But the United States is also jumping into the business. Here's the big environmental problem, as Mother Jones explains:
Rare earths occur naturally with the radioactive elements thorium and uranium, which, if not stored securely, can leach into groundwater or escape into the air as dust. The refining process requires huge amounts of harsh acids, which also have to be disposed of safely.
The good news is that car companies and other clean energy companies have been aware of this issue for a while. And car companies are already working on developing electric motors that don't depend on rare earth materials to work.