Containers still need to run on some kind of VM. If you're a small shop and the VM is managed for you by the cloud provider - fair enough. But a lot of larger enterprises still run servers managed in-house that are based off a golden image that is pre-configured to include observability agents, security agents, stuff that reports to centralized inventory management, in-house certificate authorities, etc. If you're a developer who ships a container, and it's only exposed to the stuff in the in-house server once it gets to a staging/pre-production environment - then you're missing a big part of the actual production environment in your dev environment. Vagrant can be a good choice here, depending on how customized the production servers are.

Then there are plenty of cases where cloud servers are insufficient and your actual production environment includes on-prem hardware with more specialized setups, then the VM vs. container argument gets more murky.