Hyperloop gives cash-strapped French cities hope

Limoges, Orleans and others relying on handouts of real estate, tax cuts for engineering talent and some limited subsidies to attract Hyperloop-inspired projects

A Virgin Hyperloop One XP-1 pod. French offers of free land are designed to attract hyperloop companies and ultimately improve urban economies. Patrick T. Fallon/Bloomberg

After President Emmanuel Macron scrapped plans for a high-speed rail connection to Limoges, a city in central France, local entrepreneur Fabien Thibaut picked up his phone to call Elon Musk and talk about the Hyperloop - Mr Musk’s idea for superfast trains zooming in tubes.

“This kind of project is essential for a city like ours,” said Mr Thibaut, one of many in France who wants to bring home a piece of Tesla founder Musk’s idea. “We have nothing here - this would bring companies, jobs, tourism,” he told Bloomberg.

In the country that invented high-speed TGV trains and the supersonic Concorde plane, Mr Thibaut had no trouble drumming up support from others including the deputy mayor. But with the government keen on cutting public spending, officials in cities like Limoges, Orleans and Toulouse are seeking cheaper approaches to futuristic transport, pitching themselves as hotbeds for testing.

While they can’t put fat cheques on the table, French cities are relying on handouts of real estate, tax cuts for engineering talent and some limited subsidies to attract Hyperloop-inspired projects.

“Any Hyperloop project will need government support whatever happens,” said Serhiy Yarusevych, a mechanical engineering professor at the University of Waterloo in Canada. “There are no breakthroughs required on the technology side. What will matter is the funding for land, infrastructure and R&D.”

Mr Musk’s idea isn’t new - French novelist Jules Verne imagined pneumatic pods crossing oceans in tunnels at 1,500 kilometres per hour a century and a half ago - but since the chief of Tesla and SpaceX laid out the concept of the Hyperloop in 2013, a flurry of initiatives has emerged.

SpaceX has organised student competitions to build prototypes, while British tycoon SIr Richard Branson is backing the troubled Virgin Hyperloop One, which is itself working with German car maker BMW in Dubai. Two other Los Angeles start-ups, Hyperloop Transportation Technologies and Arrivo, also are developing similar concepts.

So while the Tesla founder never returned Mr Thibaut’s call, a Canadian start-up called TransPod did.

TransPod’s technology is based on magnetic propulsion and electrified tracks, moving pods through a vacuum tunnel designed to reduce friction. As with most Hyperloop projects, the bulk of the estimated costs are for deploying infrastructure. Co-founder Sebastien Gendron estimates his company needs €20 million (Dh88.1m) in financing to complete the Limoges project at the current stage, and says he’ll raise half of that from private investors.

In Limoges, discussions have zoomed in on the prospect of building a 3km test track and a 15-person research centre, as TransPod seeks subsidies from government-backed structures in the region as well as from the European Union. Limoges Mayor Emile Roger Lombertie said TransPod must first find venture capital investors before the city jumps in to help with financing. It’s now providing administrative support.

TransPod got a green light from another local authority to use retired rail tracks free of cost. The fate of the project is hanging on a decision by authorities about whether an environmental study is needed, MrGendron said.

Some 150 miles north, another city, Orleans, also took to the Hyperloop after years of unsuccessful lobbying to get a high-speed link to the French capital. The mayor’s office reached out to a French entrepreneur called Emeuric Gleizes who’s aiming to develop an air train by 2025.

While there’s little chance Orleans will offer up a chunky jackpot for his SpaceTrain, Mr Gleizes is hoping to get free access to 18 kilometres of unused train tracks in the region to test a prototype, in a deal similar to TransPod’s in Limoges. To reduce development costs, SpaceTrain ditched the idea of a tunnel and instead will move carbon-fibre shuttles carrying as many as 40 passengers at 540kph using a method based on air cushions, often employed by industrial companies to move heavy objects.

Orleans also rang a start-up from California called Hyperloop Transportation Technologies, or HTT.

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HTT will be a familiar name to those in the UAE; the company is planning a 10km Hyperloop route in Abu Dhabi and said last month it had completed a feasibility study to bring the travel system that uses electro-magnetic levitation technology to fire pods at speeds of 1,200kph to the country.

The National reported that a set of tubes measuring four metres in diameter have been moved from the HTT development centre in Spain to Toulouse in France, where the next stage of testing is to shortly get under way. The full-scale passenger capsule, currently near completion at Carbures in Spain, is scheduled for delivery to the facility this summer for assembly and integration.

Technicians at HTT hope to have a closed 320 metre system ready for testing later this year.

A second full-scale 1km system elevated by pylons at a height of 5.8 metres will be completed in 2019.

“France is one of the best European countries when it comes to supporting startups and innovation,” HTT co-founder Dirk Ahlborn told Bloomberg. “Of course France isn’t the country where everything happens the fastest - if the UAE wants something, for example, it will happen.”

In France, Mr Ahlborn is eyeing public funding for innovation, and said HTT will hire 15 people at a research lab in Toulouse. Local authorities have awarded HTT access to a former army base with a free lease that spans over 40 years, in exchange for refurbishment and de-pollution work, including removing Second World War bombs.

Back in the UAE, meanwhile, The National reported in February that Virgin Hyperloop One expects to double money it has raised from investors that may include pension and sovereign wealth funds who will help anchor agreements in Saudi Arabia, the UAE and Europe.

“We are continuing to talk to investors around the world, we continue to see those investors as having strategic alignment to the company’s next three-year phase of commercialising the technology and actually building the version that will be deployed,” the chief executive Rob Lloyd said.

The company, which welcomed billionaire businessman Sir Richard Branson as its chairman last December, has already topped the $245 million it had raised from investors, with DP World and Russia’s Caspian Venture Capital pledging together an additional $50m in the same month. Other investors include Summa Group, France’s SNCF, and GE Ventures

“Over the next coming years, we would probably think of doubling that. That’s very realistic. We are in discussions as to how to continue that momentum,” Mr Lloyd said when asked about raising additional financing. “The Saudi government could be a potential investor."

"We have had discussions with the minister of transport in Saudi Arabia. We are investigating the potential economic impact, the potential to create a manufacturing opportunity in alignment with Vision 2030,” he added.

In October, when Saudi Arabia announced plans to build a $500 billion futuristic investment zone on the Red Sea coast called Neom, Mr Lloyd said the kingdom’s Vision 2030 and the technology of hyperloop increased the potential for collaboration. Four months on, the prospect of working together appeared to be gathering pace.

Discussions included potential projects within the Arab world’s largest economy as it vies to cultivate a manufacturing and logistics industry as well as potentially linking the kingdom with major cities in the UAE.