Update: This post has been updated to indicate that DP World invested in 2016. The firm is based in the UAE.
Virgin Hyperloop One and DP World are launching a new joint venture, DP World Cargospeed, two years after the high-speed transportation technology developer tapped the UAE-based shipping company in a $50 million financing.
The company’s stated goal is to deliver palletized cargo more efficiently by combining super high-speed promise of hyperloop transportation with new logistics technologies to accelerate deliveries along Virgin Hyperloop One’s planned routes between Mumbai and Pune in India; in Saudi Arabia, and in the United Arab Emirates.
Announced with much fanfare and in the presence of Sultan Ahmed Bin Sulayem and Virgin Hyperloop chairman Richard Branson, the new company is basically built on buzzwords like “on-demand” and the promise of future performance.
Right now there’re only 10 kilometers of Virgin Hyperloop track being built (and they’re all in India).
Although there’s not much more than a bunch of pontificating palaver around hyperloop technologies now, the startup companies and their corporate backers do present an compelling vision of the future of transportation.
As China sinks billions into a new silk road to connect the world to its powerful new economic engine, incredibly fast, incredibly efficient logistics will become increasingly important — especially if it can be made more environmentally sustainable by harnessing renewable energy.
“The global growth of e-commerce is driving a dramatic shift in both consumer and business behavior. On-demand deliveries are a novelty today. Tomorrow it will be the expectation,” Branson said in a statement announcing the new company. “DP World Cargospeed systems powered by Virgin Hyperloop One will enable ultra-fast, on-demand deliveries of high-priority goods and can revolutionise logistics, support economic zones, and create thriving economic megaregions.”
Hyperloop transportation is basically shooting a container through a really really big pneumatic tube really really fast. The technology uses magnetic levitation to propel the people-and-product laden pods through the tube with little friction. Hypothetically the hyperloop should be able to achieve speeds of around 300 meters per second — faster than the fastest high speed rail technologies in use today.
Hurdles to getting a system like this up and running are immense. Most of the shipping world still runs on logistics systems designed in the 19th and 20th centuries that remain resistant to 21st century innovations
DP World Cargospeed systems, enabled by Virgin Hyperloop One technology, will transport high-priority, time-sensitive goods including fresh food, medical supplies, electronics, and more. It will expand freight transportation capacity by connecting with existing modes of road, rail and air transport.
“Based on McKinsey’s assessment of our technology, Virgin Hyperloop One-enabled supply chains can dramatically impact business bottom lines by reducing both finished goods inventory and required warehouse space by 25%,” said Rob Lloyd, the chief executive officer of Virgin Hyperloop One.
For Virgin Hyperloop One, the new joint venture with DP World is another sign of the company’s continued renaissance since bringing Virgin aboard. The once scandal-wracked startup now has a partner with seemingly unlimited pockets and a consummate salesman and spokesperson in the chairman’s seat on the company’s board.
Branson, for one, is all in on the technology (at least until Virgin Orbit starts blasting off in earnest).
“The reason I became chairman of this company, I found this ridiculously exciting,” Branson told CNBC. “I think if we can build Virgin Hyperloops in a number of different countries, connecting countries, that will bring the world much closer.”