Virgin Hyperloop lays off half its staff, abandons plans to transport passengers

The high-speed transportation company laid off about half its staff this week and confirmed that it would no longer be pursuing a passenger transit system.

The company was developing a transportation system that would send people and goods through a vacuum tube at up to 670 miles per hour but told the Financial Times that it would be focusing on only cargo shipments.

“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 Times of it decision against human transport. “These types of decisions are never taken lightly.”

The transport company explained that pandemic exposed weaknesses in the global supply chain, especially for quickly transporting freight, and saw an opportunity for its lightning-fast pods.

DP World, the Dubai-based majority owners of Virgin Hyperloop, told the Financial Times it may revisit passenger travel in the future.

“It’s abundantly clear that potential customers are interested in cargo, while passenger is somewhat farther away,” DP World said. “Focusing on pallets is easier to do — there is less risk for passengers and less of a regulatory process.”

Virgin also confirmed that it had laid off 111 employees via video conference. The job cuts amount to almost half of the company’s staff.

The “Hyperloop” was coined by Tesla and SpaceX CEO Elon Musk in a white paper published August 2013. He has since “open-sourced” the concept, allowing other companies to develop and collaborate toward making the idea reality.

Virgin Hyperloop became the first company to successfully test the technology with human passengers in late 2020, so it leaving passenger transport behind is seen as a troubling sign the concept’s future.

Musk himself has moved on to lower-tech underground car tunnels that add an additional layer of infrastructure to unclog traffic jams.