The dramatic business model shift is a response to increased demand for freight shipping amid the COVID-induced global supply-chain crisis.
Virgin Hyperloop, a futuristic train service that promised a new era of travel for passengers, will be focusing on cargo instead, it has revealed.
The Financial Times, which first reported the story, said it had also laid off more than 100 staff members.
As The Financial Times reports, on Friday Virgin Hyperloop laid off 111 of its employees, or almost half its staff, and embraced an entirely new business model: the transportation of freight, not people. Virgin Hyperloop told the FT that the change in business model was the result of the global supply-chain crisis and COVID-19. The company said a rising interest from customers in a cargo transportation service was the driving factor.
Experts have expressed doubts about the engineering challenges and practicalities of Hyperloop travel.
The company said: "The global supply chain has experienced dramatic changes in the past year, due in part to the worldwide pandemic.
"Virgin Hyperloop as a company is responding to strong customer demand for a cargo-based hyperloop system and is focusing its resources on delivering this product."
However, the hope for a passenger-based Hyperloop isn’t completely dead. DP World said that profits from the launch of a successful cargo Hyperloop service could be applied to a passenger service before the decade is out.