In 2013, business magnate and investor Elon Musk released a research paper which proposed developing an ultra-high-speed ground transportation system known as the Hyperloop. Musk envisioned a system which could transport passengers and goods in capsules propelled by linear induction motors and air compressors at speeds up to 760 mph. This is considerably faster than current rail or air travel; a trip from L.A. to San Francisco would take 30 minutes instead of a one and a half hour flight or a six-hour drive.
As co-founder of SolarCity, Tesla Motors, and space transport company SpaceX, Musk was unable to devote his time to develop the Hyperloop. However, Musk inspired an industry of Hyperloop startups. Musk’s research paper passed on his vision of the Hyperloop to various startups. Two months ago, Musk changed his mind, revealing on Twitter that he received “verbal government approval” to construct a hyperloop between Washington, D.C. and New York. He sees promise in the industry he envisioned, and so have others. Even though Musk doesn’t intend to interfere with the success of other hyperloop companies, the competition has created a modern-day Cold War: a hyperloop arms race.
On September 21st, Hyperloop One —one of numerous competing companies in the Hyperloop industry— announced that they raised an additional $85 million in financing, giving a valuation of more than $700 million. This may seem premature considering the fact that this revolutionary transportation system has no government approval, no commercial product, and no revenue stream. However, Musk’s research paper states that the Hyperloop could run on solar energy and would cost $7.5 billion In hindsight, Hyperloop One has not raised enough money remotely close to Musk’s expectations. Hyperloop One also recently named their 10 prospects in their global contest to find the most suitable location for future hyperloop tracks. Although the company has scouted the United States, Russia, and the United Kingdom, the United Arab Emirates will most likely be the victor, for Dubai and Abu Dhabi are cities of the future. Hyperloop One’s search for future hyperloop locations is pointless, though. The company still needs to gain regulatory approval. No governments or regulators are willing to give the company approval since this innovative technology has never been seen. On the other hand, Elon Musk could launch the first hyperloop, for he has obtained federal approval. Essentially, Musk picked up from where he left off in this industry; he could possibly undermine the four years of progress of companies like Hyperloop One.
Musk’s unexpected entry into this industry can threaten three startups which have raised hundreds of millions of dollars. Nevertheless, Musk’s goal is to make the hyperloop prosper; he does not want to challenge his “competitors.” One of Musk’s ventures, Boring Company, stated, “While we’re encouraged that others are making some progress, we would like to accelerate the development of this technology as fast as possible. We encourage and support all companies that wish to build Hyperloops and we don’t intend to stop them from using the Hyperloop name as long as they are truthful.’’
We will most likely have to wait five years for the Hyperloop to be available for commercial use. Though Musk presumably has federal approval, he is far behind Hyperloop One’s current stage. Besides federal approval, Hyperloop will first be used to transport cargo in order to test its efficiency. Every day the Hyperloops are increasing in speed and distance, but it will take time for this transportation system to sustain Musk’s theorized 700 mph over distances of up to 400 miles. But hopefully, this theory can become a reality.