Virgin Hyperloop switches focus from passengers to cargo as it lays off half its staff

Virgin Hyperloop One is one of the leading companies developing the eponymous technology, which is an updated version of a centuries-old idea to reduce the energy demands of trains by placing them in vacuum-sealed tubes with minimal air resistance. Elon Musk wrote an article about it in 2013, incorporating magnetic levitation, which is used in bullet trains. In addition, the current branding was developed.

Virgin Hyperloop, formerly known as Hyperloop 1, has achieved significant milestones, including the first human passenger test run. But, like many other companies attempting to commercialize experimental technology, it has struggled to attract funding and talent, as well as meet deadlines. A Virgin Hyperloop spokesperson told the Financial Times that the recent layoffs would allow the company to “respond in a more agile and nimble way, as well as in a more cost-efficient manner,” and that the decision to lay off so many people at once had not been “taken lightly.” According to the spokesperson, the shift in emphasis from passengers to freight “really has more to do with global supply chain issues and all the changes due to Covid.”

According to DP World, an Emirati state-owned logistics company with a 76 percent stake in Virgin Hyperloop, moving cargo rather than people will reduce safety and regulatory burdens. “It’s abundantly clear that potential customers are interested in cargo, while passenger is a little further away,” DP World told the Financial Times. “It’s easier to focus on pallets because there’s less risk for passengers and less of a regulatory process.”

According to the Financial Times, Virgin Hyperloop is already in talks with 15 potential customers to deliver a cargo-version of the hyperloop, and the Saudi government is considering a route connecting its port city of Jeddah with the capital Riyadh.