Today, Elon Musk revealed the long-awaited open source plans for the Hyperloop. In those plans [pdf], Musk states that the passenger version of the Hyperloop can be built for $6 billion, while the passenger plus vehicle version can be built for $7.5 billion. In either case, according to Musk, the Hyperloop will cost just a fraction of the proposed $68 billion passenger-only rail system planned for Los Angeles to San Francisco.

Is Musk's estimate realistic? Should cost overruns be anticipated? And if so, can we use previous cost overrun rates on novel megaprojects to project true costs for the Hyperloop?

  • I think the notable claim in this question, that the hyperloop will be cheaper than high speed rail, is still a question about the future, that we can't apply scientific skepticism to. The other questions ("should cost overruns be anticipated" and "can we use previous overrun rates"), are not asking for verification or falsification of a particular notable claim.
    – user5582
    Commented Aug 13, 2013 at 1:00
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    This question appears to be off-topic because it is primarily speculation about projects that have not been built yet.
    – rjzii
    Commented Aug 13, 2013 at 1:56
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    I think this question can work if you read it as "are those two estimates comparable?". Of course there is a lot of uncertainty, but with an order of magnitude difference between both estimates any smaller uncertainties just don't matter. My personal suspicion is that those two numbers compare apples with oranges, and if that is so it would make a fine answer.
    – Mad Scientist
    Commented Aug 13, 2013 at 7:06
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    It's preposterous to suggest that simply because something hasn't been built or because it is early in the development cycle that cost estimates for its development cannot be made or that the veracity of those estimates cannot be evaluated using statistical, empirical, or other methods. This type of cost estimation is done all the time: for public works projects, defense department projects, etc. Now those cost estimates are often incorrect, but I think that's exactly what the OP is asking about. How were the Hyperloop costs estimated and what is their credibility.
    – Adam Wuerl
    Commented Aug 16, 2013 at 16:53
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    One critical difference between the Hyperloop and California High-Speed Rail (CHSR) seems to be overlooked in the discussion: Hyperloop would be a point-to-point connection between LA and SF. CHSR will have 9 stations betwen LA and SF and connect to San Diego and Sacramento. Commented Aug 17, 2013 at 21:39

2 Answers 2


tl;dr: No, it is not cheaper. The unit cost of the Hyperloop is higher.

And to understand why, we need to take a step back, and think about what the proposed infrastructure is for.

It is for moving people about.

So the costs can only make sense, if we bear in mind how many people will be moved.

According to the 2012 Business Plan, the high-speed train capacity would be 12,000 people per hour in each direction (p6). They derate this for a 70% occupancy to 8,400 people per hour in each direction.

Conversely, the Hyperloop would, according to Ars Technica, move 28 passengers at 2-minute intervals, which would be 840 people per hour in each direction. If we derate by the same 70% occupancy factor, that's 588 people per hour in each direction.

So although the capital costs are about one-tenth of the costs of high-speed rail, the ridership would be much less than one-tenth of the high-speed train. So the unit costs of the Hyperloop are higher. Essentially, the nub of it comes down to the Hyperloop being super-fast low-capacity infrastructure; the train is fast higher-capacity infrastructure.

Now, there's a lot of assumptions in those calculations: the high-speed train works on the basis of trains every 5 minutes, but they could be more frequent. The hyperloop claims to be able to work at 30-second intervals at peak, but given the speeds and stopping times, that looks completely unrealistic. But one could tweak the numbers to make the Hyperloop look better, at a cost per passenger basis. However, the world has quite a lot of experience of building and operating high-speed trains. It has very little experience of bulding and runnning anything like the Hyperloop. Therefore, cost overruns are much more probable, and more likely to be much higher, for the Hyperloop than for the train.

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    Page 11 of the spacex PDF says, The Hyperloop is sized to allow expansion as the network becomes increasingly popular. The capacity would be 840 passengers per hour which more than sufficient to transport all of the 6 million passengers traveling between Los Angeles and San Francisco areas per year. In addition, this accounts for 70% of those travelers to use the Hyperloop during rush hour. The lower cost of traveling on Hyperloop is likely to result in increased demand, in which case the time between capsule departures could be significantly shortened. Maybe it's a good thing, not a bad ...
    – ChrisW
    Commented Aug 13, 2013 at 13:25
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    @ChrisW The title does say "cheaper" but the text clarifies what is meant by that. I don't think we can ignore the main question in the text: "Is Musk's estimate realistic? Should cost overruns be anticipated?" And the phrasing "Hyperloop can be built for $6 billion". I think it could be worth pointing out the differences this answer gives — not in an answer on its own, but in another answer, after answering the main questions.
    – user5582
    Commented Aug 13, 2013 at 17:37
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    I think this answer is good, because it focuses on what seems to be an incredibly discrepancy between Hyperloop and rail: anticipated demand. The ~10x more expensive rail system anticipates ~15x Hyperloop demand. Is the rail demand estimate unrealistic, in order to justify the high cost? Or is the flexibility of rail such a great demand-driver? Commented Aug 14, 2013 at 15:58
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    @LarryOBrien The Hyperloop claims to be sufficient for today's needs. The rail system's capacity is 10 times greater: apparently far in excess of today's needs. The rail system's business case (and this answer) talks about its maximum capacity. The rail system's business case's justification for that is to meet increasing demand "during the next 50 to 100 years". IMO the rail system's over-capacity (and high cost) is a bug dressed up as a feature. If it were my money I'd prefer to spend 10 times less, to meet today's needs.
    – ChrisW
    Commented Aug 14, 2013 at 21:15
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    Back to case in point, driving from LA to SF would take about 5 hours and cost about $50. Flying costs $97 and will take you about an hour and a half gate-to-gate. The Cal HSR's current business model aims for travel time under three hours and a cost as low as $52. My guess (and theirs too) is that the HSR will attract not only a lot of the air travellers, but most of the I-5 crowd as well.
    – KeithS
    Commented Aug 15, 2013 at 21:04

Fabian said in a comment,

My personal suspicion is that those two numbers compare apples with oranges, and if that is so it would make a fine answer.

An explanation of the capital cost of the high-speed rail proposal is available here: California High-Speed Rail Authority | Revised 2012 Business Plan | Chapter 3, found via the Business Plan website.

As shown in exhibit 3-2 on page 3-7, the largest cost is viaducts and tunnels:

enter image description here

The Route optimization (pages 40 and 41) of SpaceX's PDF says,

The proposed route considers a combination of 20, 50, and 100 ft (6, 15, and 30 m, respectively) pylon heights to raise and lower the Hyperloop tube over geographical obstacles. A total tunnel length of 15.2 miles (24.5 km) has been included in this optimization where extreme local gradients (>6%) would preclude the use of pylons. Tunneling cost estimations are estimated at $50 million per mile ($31 million per km). The small diameter of the Hyperloop tube should keep tunneling costs to a far more reasonable level than traditional automotive and rail tunnels.

Another difference is the complexity of the network: the SpaceX proposal is high-speed point-to-point; in contrast, the railway document says,

The new development landscape has necessitated adding many miles of elevated structures, tunnels, and other infrastructure. The new designs permit access to major downtown population centers with reduced community impacts and disruption. Approximately 30 to 36 percent of the Phase 1 Blended system may be built on elevated structure or in tunnels, depending on alignment alternatives. The possible length of elevated structures increased from 77 miles in 2009 to between 113 and 140 miles, and tunnels increased from 32 miles to between 44 and 48 miles(with the ranges based on different alternatives still under consideration).

After the track, the next biggest cost of the rail proposal seems to be land-related:

enter image description here

A analogous section of the Hyperloop document (titled "Making the Economics Work" on pages 4 and 5) says,

The pods and linear motors are relatively minor expenses compared to the tube itself – several hundred million dollars at most, compared with several billion dollars for the tube. Even several billion is a low number when compared with several tens of billion proposed for the track of the California rail project.

The key advantages of a tube vs. a railway track are that it can be built above the ground on pylons and it can be built in prefabricated sections that are dropped in place and joined with an orbital seam welder. By building it on pylons, you can almost entirely avoid the need to buy land by following alongside the mostly very straight California Interstate 5 highway, with only minor deviations when the highway makes a sharp turn.

Even when the Hyperloop path deviates from the highway, it will cause minimal disruption to farmland roughly comparable to a tree or telephone pole, which farmers deal with all the time. A ground based high speed rail system by comparison needs up to a 100 ft wide swath of dedicated land to build up foundations for both directions, forcing people to travel for several miles just to get to the other side of their property. It is also noisy, with nothing to contain the sound, and needs unsightly protective fencing to prevent animals, people or vehicles from getting on to the track. Risk of derailment is also not to be taken lightly, as demonstrated by several recent fatal train accidents.

For what it's worth, one critic says ...

Musk’s paper does an excellent job of detailing exact pricing of each element of the project so that there’s no magical thinking involved in the pricing expectations.

... and then goes on the criticize other aspects of the project's feasibility, i.e. heat (from compressing the air), and wind shear on the elevated tube.

Is Musk's estimate realistic? Should cost overruns be anticipated? And if so, can we use previous cost overrun rates on novel megaprojects to project true costs for the Hyperloop?

By definition it is difficult to predict unexpected cost overruns.

Some people (e.g. the conclusion to EnergyNumbers's answer) predict overruns because it is novel technology.

The expected cost are shown on pages 55 and 56 of the SpaceX PDF.

10% of the total projected cost is for the capsule, and 90% is for the tube (so perhaps even large overruns on the capsule side may be relatively insignificant).

The projected cost for the tube breaks down as follows:

Tube Construction 650
Pylon Construction 2,550
Tunnel Construction 600
Propulsion 140
Solar Panels & Batteries 210
Station & Vacuum Pumps 260
Permits & Land 1,000
Cost Margin 536
Total 6,000

Building things such as concrete pylons ("Due to the sheer quantity of pillars required, reinforced concrete was selected as the construction material due to its very low cost per volume"), drilling tunnels, and buying lands and permits, are all fairly well-known technologies.

One of the risks is that Elon himself will not be involved in the project: I would guess this project needs good management including risk mitigation strategies.

  • The I-5 crosses the Angeles national forest, between Santa Clarita and the dropoff before Bakersfield. This is a non-trivial and curvy portion of the route, reaching ~ 5000' (1600m) in elevation, that lasts for perhaps 40 miles. North of the San Gabriel mountains, between the valley floor and the turnoff through the hills into the bay area, it is straight.
    – Paul
    Commented Aug 14, 2013 at 23:31
  • @Paul My apologies but I don't understand why you said that, or how it relates to the question or to my answer.
    – ChrisW
    Commented Aug 15, 2013 at 0:14
  • Oh, that is a comment on "By building it on pylons, you can almost entirely avoid the need to buy land by following alongside the mostly very straight California Interstate 5 highway, with only minor deviations when the highway makes a sharp turn."
    – Paul
    Commented Aug 15, 2013 at 1:45
  • Is there a reason the Hyperloop document is being referred to as the "SpaceX pdf"? According to the document personnel from SpaceX and Tesla aided in the creation of the document, which seems reasonable since those are two large collections of very smart engineers that Elon has easy access to, but AFAIK this is essentially a personal project of that group of collaborators and not associated with SpaceX. Furthermore, public comments have suggested if either company were to get involved at some point it'd more likely be Tesla.
    – Adam Wuerl
    Commented Aug 16, 2013 at 16:58
  • @AdamWuerl I called it that only because the link in the OP is to a PDF on the www.spacex.com web site. Maybe I should call it the "Hyperloop Alpha" document, or the "Hyperloop Preliminary Design Study".
    – ChrisW
    Commented Aug 16, 2013 at 17:43

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