Virgin Hyperloop has laid off nearly half of its staff as the company shifts from carrying passengers to shifting freight. Cuts totaling 111 jobs have been confirmed by Virgin Hyperloop for The Financial Times, who spoke with former employees of the company. They described the scale of the layoffs as “definitely not expected”.
US-based Virgin Hyperloop is one of the leading companies to develop the eponymous technology – an updated version of a centuries-old idea to reduce the energy needs of trains by placing them in sealed tubes vacuum where air resistance is minimal. The concept was resurrected in 2013 when Elon Musk published a white paper on the subject, incorporating the magnetic levitation used by high-speed trains and giving it the current brand.
Virgin Hyperloop, formerly known as Hyperloop One, has achieved significant milestones, including the first-ever trial with human passengers. But, like many companies trying to bring experimental technology to fruition, it’s also struggling to attract funding and talent, and to meet deadlines. In 2017, company executives said The edge they expect to see “working hyperloops worldwide…by 2020”. This date was later pushed back to 2021. There are currently no working hyperloops in action.
A Virgin Hyperloop spokesperson told the FT that the recent cuts would allow the company “to respond in a more nimble and nimble way and in a more cost effective way” and that the decision to lose so many staff at once had not been “taken lightly”. The spokesman said the shift in focus to cargo rather than passengers “really has more to do with global supply chain issues and all the changes due to Covid”.
Transporting goods instead of people will simplify security and regulatory burdens, according to DP World, a state-owned Emirati logistics group that has a 76% stake in Virgin Hyperloop. “It’s quite clear that potential customers are interested in freight, while passengers are a bit further afield,” DP World told the FT. “Focusing on pallets is easier to do – there’s less risk to passengers and less regulatory process.”
As reported by FTDP World said Virgin Hyperloop was already in talks with 15 potential customers to deliver a freighter version of the hyperloop, and the Saudi government was considering a route linking its port city of Jeddah to the capital Riyadh.