Sir Richard Branson is preparing to sell Virgin’s stake in US Hyperloop start-up as interest in the technology envisioned by Twitter billionaire Elon Musk has waned.
A source said Virgin will begin to demerge its branding from the US business Hyperloop One in the coming weeks and sell its equity stake at the same time. It has already removed its logo from the company’s website.
Sir Richard’s company acquired a small stake in Hyperloop One in 2017, rebranding it as Virgin Hyperloop One.
Hyperloop is a theoretical alternative to high-speed rail, where pods fly at 760 mph through steel tubes. The technology was first proposed by Mr. Musk in 2013, prompting a group of start-ups to try to create one.
A Virgin Group spokesman said it had decided to remove its branding because Hyperloop One’s business plan was to shift from high-speed passenger transport entirely to cargo. Virgin board member Luigi Brambilla will also step down.
The spokesperson said: “Virgin Hyperloop recently made the decision in response to market demand to focus its immediate efforts on cargo-based solutions. Due to changes in Virgin Hyperloop’s short-term priorities and due to changes in Virgin Hyperloop’s Board and its After discussing this with shareholders, Virgin Group has decided to work with Virgin Hyperloop’s management team to take the Virgin brand out of business.
Hyperloop One – Virgin.com
Sir Richard lauded the technology as “an incredibly innovative and exciting new way to move people and things at the speed of the airline on the ground” after purchasing a stake in the company.
However, Hyperloop technology has failed to fly. No functional Hyperloop has been built since Mr Musk’s proposal, other than a $500m (£439m) test track built by Hyperloop One outside Las Vegas and a prototype on display at rocket company SpaceX’s headquarters in Hawthorne, Calif.
The technical challenges and huge costs have proved difficult to overcome. Last week, it emerged that the mile-long Hawthorne Tunnel would be removed to make room for a car park.
However, on Saturday, The Boring Company, a tunneling business started by Mr Musk, said it was working on “hyperloop testing”.
Hyperloop One has raised north of $400m (£351m) for its technology, but laid off more than 100 employees earlier this year as it shifted its business plan.
A spokesperson for DP World, a Dubai investor that is a majority shareholder of Hyperloop One, said it continues to support the company.
“We believe Hyperloop technology will form a core part of the business network that delivers goods to consumers where and when they need them,” the spokesperson said.