Virgin Lays Of Half The Staff Of Hyperloop, Dooming Venture

Virgin Hyperloop laid off almost half of its staff working on Friday, making 111 people redundant, as the company shifts focus from transporting people to shipping freight, Eamon Barrett reported for Fortune.

Photo Insert: A Virgin Hyperloop installation

“It’s allowing the company to respond in a more agile and nimble way and in a more cost-efficient manner,” Virgin Hyperloop told the Financial Times, blaming the company’s change in direction on COVID “global supply-chain issues.”

But hyperloops—which propose propelling passengers down a vacuum-sealed tube in pods at speeds reaching 670 miles per hour—were struggling to gain traction long before COVID. Virgin Hyperloop has intrigued only one potential client, Saudi Arabia, since its inception in 2014, while rival hyperloop ventures have already given up.

Tesla CEO Elon Musk first detailed his vision for a hyperloop system in 2013 and, through his tunneling project the Boring Company and his SpaceX venture, launched a competition for engineers to design one the next year. But despite funding hyperloop competitions, Musk and his businesses aren’t building any hyperloop service.

Critics caution that bringing the venture to fruition is too expensive. In 2016, leaked documents showed Virgin Hyperloop estimated its proposed hyperloop line connecting Los Angeles to San Francisco would cost roughly $84 million to $121 million per mile.

Another proposal linking Abu Dhabi with Dubai was quoted at $52 million per mile. Both costs are higher than the $11.5 million per mile price tag Musk originally envisioned in his 2013 hyperloop white paper but were on a par with existing subway and light-rail lines, which cost around $100 million per mile to build in the US.

A four-lane interstate highway, meanwhile, costs around $11 million per mile, according to the American Road and Transportation Builders Association (ARTBA).

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