The company — which envisions a high-speed “vacuum tube” transportation system with pods moving up to 670 miles per hour — will instead focus on cargo shipments.
Virgin Hyperloop confirmed the company was “changing direction,” adding that the shift in focus was largely related to the need for a more robust transportation system when it comes to moving freight. It’s a weakness in the global supply chain that was especially exposed during the COVID-19 pandemic.
It’s thought that Virgin’s lightening-fast pods could be a solution to moving lots of goods quickly.
“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 of its ditching public transport in favor of a laser focus on freight “These types of decisions are never taken lightly.”
The layoffs were conducted by video conference, two people who were affected told the newspaper. The number of job cuts was “definitely not expected,” according to one of the sources. The company said 111 people were laid of.
The shift toward cargo shipping marked a significant change for Virgin Hyperloop, which is reportedly considering going public through a merger with a special purpose acquisition company, or SPAC.
Virgin Hyperloop did not comment on those plans, but told FT it “continues to invite long-term investors who share our vision for the future of transportation.” The company has raised more than $400 million from investors to date.
DP World, the Dubai-based majority owner of Virgin Hyperloop, told the newspaper the firm could revisit passenger travel once cargo services were up-and-running.
“It’s abundantly clear that potential customers are interested in cargo, while passenger is somewhat farther away,” DP World said in a statement. “Focusing on pallets is easier to do — there is less risk for passengers and less of a regulatory process.”
Formerly known as Hyperloop One, the company formed to pursue the vacuum-tube technology first outlined by billionaire Elon Musk. Hyperloop One changed its name to Virgin Hyperloop in 2017 after billionaire Richard Branson joined its board of directors.