Hyperloop more than a pipe dream? Loop in governments for action

27 July 2023 Consultancy-me.com 5 min. read

The phenomenon of hyperloop transport is from a technical standpoint increasingly becoming a serious reality, sparking excitement among travellers, governments – and climate activists. Actually realising the ambition will however remain a pipe dream without successfully looping in the support of governments, warns a new study by Roland Berger.

Initially concepted more than 200 years ago, hyperloop is a mode of transport that sees people carried – or warped at hyper speed – from starting point to destination. Using electric propulsion and magnetic levitation technology in low-pressure tubes either above or below ground, the pods (or carriers) can reach speeds of 700+ miles per hour.

In comparison, most commercial airplanes fly at around 600 miles per hour. “Hyperloop can be a disruptive technology that offers sustainable high-speed transport,” said Tobias Schönberg, partner at Roland Berger. “It can offer passengers the comfort of a train with the speed of an airplane.”

Key components of Hyperloop system

There are however a number of issues and challenges that come with hyperloop. These are so pressing and complex, that a decade on from the release of Elon Musk’s Hyperloop Alpha document (a technical proposal for the design and development of a hyperloop operating system) little progress has been made.

“There are studies enough,” said Schönberg, “but still no one has taken the leap of faith required to turn the dream into a reality.” Notably, there still is not a single transportation corridor between two cities, and the longest hyperloop test track still sits at 500 meters. Further: interest from much-needed investors has stayed away, delaying Hyperloop’s development and implementation.

Meanwhile, while governments are demonstrating some interest, progress is slow or uncoordinated. The UAE and Saudi Arabia are in fact considered as early innovators in this regard, with the two governments recently launching feasibility studies into two corridors, Abu Dhabi – Al Ain in the UAE, and Dammam – Jubail in Saudi Arabia.

A winning combination

Time to tap the benefits

The benefits of achieving a hyperloop corridor could be immense, according to Roland Berger’s assessment.

For long-distance travel passengers, it could drastically reduce their travel time while providing more convenience. “It is faster than conventional plane, rail or road transportation and more comfortable,” said Schönberg.

Take the trip from Dubai to Riyadh as an example. This journey is currently made by air, with passengers needing a travel time of around four hours, including commutes, waiting and the flight itself. With hyperloop, the journey time could be cut by at least half.

Moreover, it comes with the key advantage of flexibility. Gone are the days of planning trips around a single flight per day or trains that go per the two hours – hyperloop offers the opportunity to provide on-demand services that do not run on a fixed schedule. “Pods could bypass selected stations and provide a seamless journey without unnecessary stops.”

Existing Hyperloop test facilities

For governments and city municipalities, there is the advantage of being able to build a new network from the ground up. “By offering a blank canvas in terms of its network, Hyperloop can differentiate itself from other modes of transport. It can avoid the mobility flaws that have evolved in some cities through expanding infrastructure such as missing links between regional railroad stations and airports,” explained Schönberg.

Then comes sustainability. Air and road transport are major contributors to global emissions, with the carbon footprint of hyperloop a fraction of its nearest competitors. According to Roland Berger’s engineering analysis, hyperloop’s emissions are five times lower than its closest land-based counterpart, high-speed rail, and nearly 25 times cleaner than commercial aircraft.

As one example of its potential positive impact on mother nature, “on selected long-haul corridors, hyperloop solutions could reduce domestic air traffic by 40% on selected,” said Schönberg.


Looping in governments for action

Based on their assessment, Roland Berger (which is working on hyperloop related projects both in Europe as well as in the Middle East) said that to turn visions into action, governments will need to step up their support. “Without public-sector backing, the future of Hyperloop is uncertain,” said Santiago Castillo, a partner at Roland Berger.

“It’s a matter of throwing a lot of money at it and making sure that you take enough time as well to test everything properly,” he added.

In the key early stages, governments will need to also fill a hole that typically is bridged by investors. “Hyperloop has a long-term planning horizon. If you look at private equity firms, they want an exit in five to seven years. That’s not Hyperloop. This is more like 20-30 years. Who has the patience for that? It can only be a government.”

Middle East governments however are still far from convinced. According to reporting by Arabian Gulf, governments across the MENA region are preparing to hand out $167 billion worth of contracts to fast-track their respective rail agendas. Hyperloop is “hardly” on the agenda.

To top officials in ministries of transport, Schönberg and Castillo have a number of recommendations. First, use public money to stimulate the private sector and to cover risks. Second, establish a clear regulatory framework for hyperloop, in the footsteps of what the European Commission is trying to achieve with its EU regulatory framework for Hyperloop.

Third, secure public land for testing facilities, and fourth, governments should take a more active role as the “guardian of collaboration” among stakeholders in the ecosystem.