Tesla Motors Inc (TSLA): Would You Invest In Elon Musk’s Hyperloop?
Elon Musk is no stranger to game-changing ideas. The visionary was behind PayPal, then one of the first attempts at commercial space travel with SpaceX, as well as CEO of market darling Tesla Motors Inc (NASDAQ:TSLA), the surging electric car maker.
However, his latest idea could very easily top them all, and revolutionize transportation as we know it, the “hyperloop”. The transportation mode has been called by Musk as a ‘cross between a Concorde and a railgun and an air hockey table’, and is intended to get travelers between San Francisco and Los Angeles in 35 minutes.
What’s a Hyperloop?
The hyperloop is basically a passenger tube that shoots capsules in a low vacuum environment, reaching speeds of 760 mph. In essence, passengers are moved like a puck on an air hockey table, except in a controlled environment that has the ability to slow down and speed up as needed.
Musk believes that the total cost of such a program can come in below $10 billion—a fraction of the total cost of the current proposal for California’s high speed rail system. Meanwhile, not only will it be far faster than the rail proposal (which is expected to top out around 220mph), but Musk believes that a $20 one way ticket is possible with his plan (you can read the full PDF file of the proposal here).
However, many have come out against the idea, saying that it will not work for a variety of reasons. Chief among them are concerns over earthquakes, as well as fears about the air pressure. There are worries that the compressed air would create too much heat, or that a small leak might prevent the near vacuum from staying at appropriate levels.
But what do you think of this proposal; can something like this be achieved for less than $10 billion?