The company furthest along in making Hyperloop a reality; Hyperloop One, has the potential to become the world’s most valuable unicorn, because of the underlying promise of its technology.
There are several ways that Hyperloop would be able to generate vast amounts of money for those invested or involved in it. Unfortunately some of these revenue sources are poorly understand; because most of them have been poorly covered by commentators and “the media.”
How Hyperloop might Generate Vast Amounts of Money
Here are some of the ways that Hyperloop would be able to generate vast amounts of money if it is successfully built and utilized:
- By providing the infrastructure for telecom systems such as high-speed internet and cable television. It would be a fairly easy matter to add something like Google Fiber to every Hyperloop tube, then use it to wire up every community along the route. This would provide funding and give average people a reason to welcome Hyperloop to their communities. Here in the United States most communities still lack high-speed internet because of the cost of running wires to the big city.
- Providing new infrastructure for the delivery of electricity. Hyperloop will use vast amounts of electricity, making it a top customer for utilities. It will also be a perfect system for transmission of electricity across the countryside. Since the market for electricity is about to dramatically because of the widespread adoption of electric vehicles this a big opportunity. One major opportunity for Hyperloop will be connecting renewable energy sources such as wind farms and solar farms to the electric grid.
- As a delivery mechanism for liquids and gases including oil, natural gas, gasoline and water. Pipelines can easily be added to the Hyperloop system or run along aside it. This can be a vast profit center because Warren Buffett made his money partially through the ownership of pipelines. America’s second largest private fortune that of the Left’s favorite bogeymen the Koch Brothers was also built partially with pipelines.
- As a next generation delivery mechanism and logistics solution for freight, packages and mail. Hyperloop One CEO Rob Lloyd has described his company’s technology as “Amazon Prime on steroids.” That means Hyperloop would supercharge ecommerce by greatly increasing its’ speed and efficiency, while tremendously reducing costs. For example costs might be cut up to 90% by eliminating the need for air freight while speed might be increased by a factor of 50% (Hyperloop currently moves at speeds of nearly 300 miles per and might be capable of traveling at 700 miles per hour).
- Greatly increasing the efficiency and reducing the cost of freight shipments. Today if Amazon wants to ship a next-day package from Baltimore to Canon City, Colorado, it must be loaded on a truck, shipped to an airport and loaded on a plane, flown to an airport in Colorado. Then loaded on another truck taken to a distribution center, loaded on another truck taken to another distribution center then final placed on a van for local delivery. With Hyperloop, Amazon might load the package into a cargo container, put the container on Hyperloop and shoot it to Pueblo or Colorado Springs, Colorado. Once there it would be unloaded and placed on a van for local delivery. Get the picture the cost of delivery might be reduced by half, two thirds or more with Hyperloop.
- Greatly speeding up the shipment of bulk commodities while reducing its cost. One of the biggest flaws in our current transportation network is that the bulk transport of commodities such as coal and gain is both slow and inefficient. Around 60% of America’s food exports move on barges through inland waterways that travel at around three miles; or six kilometers, an hour. Hyperloop might greatly increase the speed of such transport while reducing the cost because it runs on electricity not diesel fuel like barges, American freight trains and trucks.
- Allowing for greater customization of manufactured goods. For example you might be able to walk into a Tesla dealership in Miami, order your new custom designed car. The car would be made at the factory in Michigan or Ontario and delivered to you the next day. This is not as fantastic as you might think; BMW’s Mini subsidiary is already mass manufacturing customized cars in Oxford, England.
- Greatly increasing the efficiency of retail and other industries by eliminating the need for large inventories. Ford for example would only need to have a few sample cars in its dealerships. New vehicles would be custom made for buyers and shipped to them. Retailers can reduce their stock on hand to a few heavily purchased goods. Your local Walmart might be turned into a pickup point for orders and a fulfillment center for same day delivery.
- Making long-distance ground travel for passengers cheaper and more convenient than air travel. Long-distance passenger travel is now very cheap thanks to jet airliners, but it is still highly inconvenient. The number of airports is limited, and they are often located far from where people live. Some people have to travel for several hours or days just to reach the airport. Hyperloop would allow high-speed travel to be extended to many outlying cities and towns and to downtowns. Instead of a long trip to the airport many people would be a short drive or even walking distance from Hyperloop.
- Greatly increasing real estate values in some areas. The big money from almost every new method of transportation including railroads, canals, and highways has been from buying and developing land near it. Property near on the Hyperloop might greatly increase in value. Largely because of new commuting opportunities. For example homes in Albany might double or triple in value because that city might be less than 20 minutes travel time from Manhattan with Hyperloop available.
- Opening up new opportunities for real estate development. One reason why America went through a massive economic boom between the 1950s and the early 2000 was all the land made available for development by new highway construction. The new highways led to the creation of vast new suburbs, Orange County, and Aurora Colorado for example, and to whole new cities including Las Vegas, St. George, Utah, Orlando, and Vail, Colorado, which grew partially because of Interstate highways. Hyperloop would do the same and create vast new fortunes in the process. Some of the biggest opportunities will be in currently empty rural areas that are a few hundred miles from crowded big cities. Examples of these include: Bakersfield, California, Kingman, Arizona, Colorado City, Colorado, Leadville, Colorado, almost anywhere in Maine, and Cheyenne, Wyoming.
Therefore Hyperloop can be the source of big new fortunes but please invest carefully and do your homework. This piece is entirely speculative because the technology is only in the development stages. Today nobody knows if Hyperloop will work or if it will be widely adopted, but stay tuned because there are some intriguing possibilities for profit here.
Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.