Public transport to be free in the future – HyperloopTT CEO

SS: I know there has been some progress in implementing Hyperloop in Russia. Where are you at right now?

DA: We opened up our R&D centre in Toulouse in France and we’ve just announced the first commercial line in the Emirates, in Abu Dhabi. We are going to be starting with the first 10 km, then later on hopefully connecting to a larger network. In Russia we have been having several discussions, and so far there’s nothing really I can comment on. You know, our goal is, of course, to become Russian. I think, there’s amazing skill set in Russia, we’re looking into eventually doing some of the development here. We already have some partners, team members from Russia. 

SS: Last year when you were at the same forum you said there were a lot of Chinese investors, and this project may even be part of the Silk Road...

DA: I think that the Silk Road is the perfect application, if you want. Using the new technology like the Hyperloop allows you to move freights within hours to Europe rather than weeks. Plus, those containers that we’re moving through the ocean - those ships are not that great for the environment.

SS: Is it just a great idea or are you actually implementing it as we speak?

DA: I think, the whole project of the Silk Road is still a little further out. So we are in discussions, we are part of the vision. But you have to understand that we’ve been working on our technology for the last five years, we’re ready to get into into the commercial phase now. But it’s still going to take a couple of years to...

SS: Let me ask you a question about that as well. You told me you live on an airplane. So I figured that you are traveling the world to offer this project to different countries. Which country would you say right now is the most eager to take upon that?

DA: You know, we started as the first commercial project in the Emirates. So definitely the Middle East is one of the areas. We have projects in India, Indonesia, South Korea. We are working with the governments, they’ve created consort teams, so we’re licensing our technology and we co-developing with those consort teams’ members. In Europe we have quite some interests. In France we’re establishing our R&D centre, in Brazil we’ve just opened up our innovations centre, XO Square. But in general I would say that it’s Asia, India, Indonesia, the Middle East, other countries that definitely need to move now. They have problems, and these problems need to be solved, and we are a solution.

SS: So from what I understand there’s Hyperloop One, Hyperloop Transportation Technologies, other companies, and they are all working on the same thing. Are they competitors, is that right?

DA: We were the first company that started working on the Hyperloop. We realised really early on that it really needed to become a movement rather than just a single company trying to do something in one country. And that’s what it is today - there are several companies and universities, everybody is working on the Hyperloop. There are really two main companies - Virgin Hyperloop One and us. The others are working mostly on specific applications, it seems. I would say that we are probably the ones who are more integrating and looking into the whole operation from passenger to freight, to first- and last mile integration. That’s also part of our model. We work with partners, with companies and people that have the knowledge and they bring that knowledge to our company.  

SS: That’s another thing that’s so strange to me because it’s a very open-sourced company or concept. Aren’t you afraid that somebody will just want to snatch the commercial know-how, the technical know-how?

DA: It’s not open-sourced. It’s an idea, and, of course, everybody can start working on an idea. Everybody can try to develop a self-driving car. That’s pretty normal. Our technology is not open-sourced. We have technology that we developed, technology that we licensed. The way we work is completely new. It’s a covert case study now, so Harvard started to teach our model last year. It’s based on collaboration. We don’t try to reinvent things, we find the best technologies around the world, we’re bringing them together. Basically we are standing on the shoulders of giants in order to make this practically happen.  

SS: When you say ‘Hyperloop’ you’re obviously thinking of Elon Musk because he is the one who introduced the concept in 2013, I think. I know that he’s backed off from it right now. But for you, ‘cause you are bringing this idea to life, you’re actually dedicating your life to it, does it annoy you that it’s associated with Elon Musk? Is it a boost or a burden that Hyperloop is associated with his name?

DA: Elon Musk was the person who in 2013 basically pointed his finger and said: “We really should be doing something better than what we’re doing right now.” Hyperloop is not a new idea. It’s been around for quite some time. Already a couple of hundreds years ago we were trying tube-travel. So we all are very fascinated with the idea because we grew up with it. If you watched ‘Futurama’ or the ‘Jetsons’, they are traveling inside tubes. It’s pretty normal. Disney had concepts like that. There were several implementations that we planned in the 90s and in the 60s. So Elon proposed this idea and he said he was too busy with Tesla and SpaceX, he wanted someone else to pick it up. We reached out, we asked for permission, we were the first company out there and, you know, we were alone for almost two years. So it’s great that there are more people there. It’s great that Elon Musk is there pushing the idea and supporting the community. In the beginning it definitely helped create awareness. However, we always try to make understand that it’s not one single person. It’s not just Elon Musk, it’s a lot of people. It’s not me, though I’m the CEO. It’s really all the partners that are coming together - all the people that are making this movement. It’s more than just a company, it’s a movement, several companies now.

SS: You have said that Hyperloop could actually be free for passengers off-peak hours. Who in his right mind would try something like that? People are willing to pay so much money to go on a plane to save time, because it’s fast. Why would you ever want to make it free when you can make so much money out of it?

DA: First of all, I think that most transportation is going to be free, and we’re actively working on that. And the reason that...

SS: Most of the transport - do you mean Hyperloop? Is it going to be free?

DA: Yeah, Hyperloop, local transport, maybe even trains or partially at least. It doesn’t mean that we’re out of our minds because we want to give things out for free. It just means that we believe that there’s a better way of making money. If you think about that, the amount of time that you spend inside your car, inside a plane, inside a train and in the future inside a Hyperloop, and nobody tries to make money entertaining you - how do you monetise the time if you think about transportation as a marketing? And now we use the time better, everything starts to change. We spend billions of dollars to get people to places so that they can spend their money there. In transportation we’re already there. We’re not using the time well. I was just on an airplane for nine hours, and it was lost time.

SS: Seriously? Those nine hours of transatlantic flights are my favorite because no one can get to me, it’s only time I can have for myself. That’s priceless.

DA: Yes, but it could also be nicer than it is.

SS: Like what are you thinking?

DA: First of all, we’ll find the way to make more money, the more the passenger rides, and the ticket becomes negative. You want people to spend more time, to travel more often, you know, to be there. Then you’ll use the ticket rather in peak-hours maybe to regulate demand.

SS: So the price of the ticket will be nothing or very low, but then whatever services are offered on board you couldn’t refuse them, because they are so wonderful, so you’re going to be spending your money on them. Is that what you’re saying?

DA: No, of course, you can refuse them. There are always ways of...

SS: Is it like going to McDonald’s: if you don’t want to buy anything, you still buy it because it smells so good, right? Once you’re there, you buy something for sure...

DA: Yes, but I believe there are plenty of ways how you can monetise the time the passenger spends. Some of them might opt for certain services, others may just want to rest or use some of our devices or have better access to entertainment. It’s going away from classes - it’s not having economy, business and first class any more, - and moving over to a use-case driven transport. So what do you want to do? What do you feel like at that time? Do you want to spend time with your family? Or are you on a date? Are you having a work meeting or do you want to relax? Those are more the directions...

SS: So let’s say, I want to go on a date while I’m traveling - am I going to have a separate cabin for a date? How is that going to look? I’m sure, you have a visual study perception of that as well…

DA: So the way that we do this is using an ecosystem. We work with companies, we work with start-up founders, if you want, new innovators to come up with the whole ecosystem the market wants. Of course, I can give you some of the ideas. But at the end you can always have so many…

SS: Name one. I just wonder, how’s that going to be different from this amazing first-class airplane service? They have a lot of entertainment there too.

DA: So, maybe it’s a separate cabin, maybe you have a bottle of champaign there, maybe you have the right music in the background, maybe you have projection mapping around you, so you can create an atmosphere. If it’s a business meeting, maybe you have simultaneous translation integrated. So you don’t have language barriers any more. Or you have recording, or you have the connection. You’re able to have your doctor’s visits. Rather than spending time when you get through a destination to do these things, you can actually do them while you’re traveling. And again, for us it’s more about providing the technology and then open it up to other companies that can provide these services. 

SS: How is it going to technically, physically feel to be inside the tube? First of all, it’s super-high speed, right? What happens if it crashes - everyone dies? It’s not funny, it’s a vital question...

DA: Yeah, you know, first of all, we don’t feel speeds. We feel acceleration and deceleration. If you’ve been on a transatlantic flight you already went roughly 1000 km/h. So it feels the same way. Acceleration and deceleration is something that you basically modify based on comfort. And comfort comes first when we do a route planning. It’s always the first part. We need to build something that works for a 2-year-old as much as for an 80-year-old. And safety - it’s given that you’re building the system which is the most safe you can build it. The system in itself is ten times safer than an airplane, to give you an idea. The reason for that is that there are ten times less failure modes. If you think about it, the airplane is actually fairly scarier: they are up there in the sky somehow, and if something happens it needs to land. We’re able to stop within seconds, we can separate the sections, we can depressurise, and you can leave through emergency exits  - that’s very similar to what you do today in subway or on a train. Of course, when you’re talking about a crash, you’re already assuming that there’s a crash. In an ideal case your safety system in place prevents that there’s a crash. But now, there are terror attacks, and things happen right in front of you... So, of course, there are always going to be certain scenarios where you can’t really do anything about it.

SS: So it’s faster than a plane and it’s moving in a vacuum. Am I going to be feeling like an astronaut in a capsule?

DA: No, it’s actually very similar to what you’re already experiencing.

SS: So I’m going to be floating around in air?

DA: That’s gravity. For that we need to be outside of space. But you’re in a pressured vehicle, just like an airplane. They are pressured vessels basically. And it’s not a complete vacuum. It’s a low-pressure environment. So there’s still some air left. It’s basically very similar to an airplane which would go in very high altitudes. And we do that so that we can move much faster using much less energy because there’s less resistance - that’s the whole trick. When we looked into the feasibility of the system the one thing which was very surprising to me is that there’s no rail in the whole world that makes money. They all lose money and use taxpayer dollars.  

SS: But they are not supposed make money, they are a public service… It’s not a business.

DA: Why?

SS: Because it’s a public service, it’s supposed to make people’s lives easier and not to make money.

DA: Well, of course, if you tell me that I get money every month, I don’t have to think about how to make things better. But if we start thinking how we can make money and how we can build something that makes economic sense, first of all, we will have more of it, it will be a better quality than it is today. Just think about what it does not only to the Third World countries, but to the Second World countries that don’t have an infrastructure today. We are able to create megaregions, bring people closer together changing the way that we live. The Hyperloop will have the similar impact the railways have. 

SS: Did you think about what kind of impact it would have on countries like America? The way the railways work there, they are just making money in East Coast. And the profit from the East Coast is what funds the railways in the Midwest and the West. If you coming with your business - I’m pretty sure it’s going to be from one big city to another big city, right? You won’t be having little local towns connected via Hyperloop - that would mean that you’ll put all American railways out of business…

DA: So we’re not in competition, we’re a technology company. So we develop technologies that are basically used by transportation companies. So we’re, if you want, the next step. And it’s about building something that makes economic sense. Those trains on the East Coast are not making money. If you really take a look into the cost of the infrastructure and everything around it, take away the government subsidies - they are all losing money, and that something that needs to change. In fact, in America, for example, the infrastructure for trains is terrible. Accidents happen all the time because of bad infrastructure in addition to, of course, human factor. We need to solve these issues. We need to be able to build infrastructure that makes economic sense, that has the return of the investments. And saying that it’s not necessary, that it’s something that should be there… You know, I believe education should be there, healthcare should be there. If there’s something that can make money, it should make money. So ideally it’s going to be a better system and better service.   

SS: Do you think it’s going to be an infrastructure that will be working closely with governments? Do you think it’s going to be a federal-level thing, or is it going to be a private business? 

DA: It can be private, however, in most countries the government wants to be part of anything that is infrastructure-related because it has closely to do with the development of the country. Normally these projects are PPP (private-public partnership) projects that are developed together with the government. In our case most of the transportation companies that we’re talking about have an existing network and will hopefully be able to create a better network in the future.

SS: Could it ever go under the ocean?

DA: Technically it’s possible. There are already the first tubes underwater, if you want, in Norway. Norway has the engineering capabilities and the knowledge. In our case when thinking about going under the ocean most people think about connecting America to Asia, for example, going under the Pacific. There are a lot of safety issues with that, of course, because the moment you have to get out, you’ll be somewhere in the middle of the ocean. For now we concentrate on land.

SS: I’m thinking about going from New York to LA in an hour - is that something that could happen?

DA: No, our top speed is right below the speed of sound which is around 1200 km/h.

SS: It’s more than a plane.

DA: Well, passenger planes are normally under a thousand. Jets go 2000-3000 km/h. But going from the East Coast to the West Coast will be happening through a network. So, you will have stops in between. It also makes more sense when you think about the cost of the infrastructure that you have to build.

SS: Is that something that’ll be above ground, underground?

DA: It really depends on the routes. Ideally it’s above ground because we’re using the same structure to produce alternative energy. But you might have to build tunnels, you might have to dig trenches in many cities, especially in Europe, for example, where there’s existing infrastructure and it’s very difficult to go through and get to the centre. 

SS: Can you transport cargos?

DA: Of course, freight is actually a very important part of our business model. And as I mentioned earlier, the Silk Road project, One Belt One Road is actually something that enables a completely new way of how the whole economy would work. We’re enabling the on-demand economy.

SS: You’re basically revolutionising everything around you, transport system. Do you feel like it’s going to have some kind of legal implications? Do you feel like Hyperloop will require a new set of laws? 

DA: Actually that’s the biggest challenge. So it’s not the technology, it’s not the funding, but it’s regulations. So you need to create these new laws, it’s not an airplane and it’s not a train. When we innovate we try to not think about regulations at all because it allows us to work with a blank sheet of paper and that’s a big advantage that we have towards the existing modes of transportation. We really want to invent the transportation system the way you would do in 2018. So we’re thinking and questioning everything. But now when we move into commercialisation of the system, of course, you can’t really implement the system worldwide if you don’t have regulations in place. So we have been working with our partners from Munich Re, for example, which is the largest reinsurance company in the world. They published a risk report last year saying that they are going to be able to insure our technology which is a very important step towards commercialisation of our technology. We’re also working together with TÜV SÜD which is also a safety institute which creates safety guidelines with governments around the world. So this time we’re working with India, Indonesia, South Korea, Slovakia, Czech Republic, Brazil, the Emirates, of course, where we’re starting to implement our first commercial system. And these are some of the countries, so we’re moving worldwide. It’s important to not only work with one - you never know when you talk about politics, things can happen, things can change very fast. So being able to work with several governments around the world is very crucial.   

SS: I know that a group of engineers that are working with you are working for free...

DA: Unfortunately, not.

SS: Really? Is that a misinformation?

DA: Yes. There’s a little bit of misinformation. First of all, we have over 800 people in our team in addition to 50 companies. Most of these people are working for participation in the company, so they are not working for free, they are receiving stock options in the company which, of course, are worth money, if you talk to my investors, they are worth a lot of money. Then we have, of course, a full-time team that manages all of these companies and contributors.  

SS: Are you saying that the first 10 km are already going to take place now? 

DA: Yes. We announced our agreement together with Aldar in the Emirates. We’re looking into the first implementation of the first 10 km in a year. Now we’re at the permitting stage, in the meantime we’re working on our R&D centre in Toulouse, where we’re going to be building verge No.2 until 2020, let’s say.

SS: Yes, this is what I was going to say - when will the first town-to-town thing take place? Give me the time frame.

DA: In the Emirates I would estimate roughly 3 years of construction. We hope to have the first phase done around 2020. So this is kind of the goal for us. It’s a very ambitious goal because it doesn’t only depend on us, but that’s hopefully when you and me can use the first Hyperloop together.

SS: And then, when will it become widespread - a decade?

DA: That really depends on the regulations. Depending on how fast we can move through with different governments around the world, but I would estimate probably… You know, it’s not a sprint or a marathon. 

SS: Alright, Dirk. Good luck with everything. I hope we can make it happen very quickly. I can’t wait to be one of the passengers and go on a date actually on a Hyperloop. I heard that you actually have to be seated and have your seatbelt on all the way through. Is that true? Or is it misinformation too?

DA: It would depend on the acceleration on the route and, of course, on the regulation as well. Ideally you will be able to move pretty freely. And there will be a toilet, which is what most people are concerned about.

SS: Thank you, I was concerned about that.  Well, good luck with everything. Thanks a lot for coming to our programme.