Bosses given axe as Virgin Hyperloop fights for survival
Transition from start-up to mass transport to blame for laying off staff, claims Branson-backed company
VIRGIN Hyperloop One, the highspeed transport company backed by Sir Richard Branson, has laid off dozens of staff including top executives as it fights for its future.
The Los Angeles company has fired about 40 employees, including its chief financial officer and engineering head, The Daily Telegraph can reveal.
The lay-offs include the majority of staff at its Nevada metalworks facility, the manufacturing plant where it has built a working prototype of the hyperloop system.
The company is believed to be looking for new funds and surviving on regular injections from key shareholders as it seeks a government contract.
Hyperloop systems involve transporting passengers in pods travelling at speeds of up to 700mph through near-vacuum tubes.
First proposed by the billionaire tech entrepreneur Elon Musk six years ago, supporters see them as a way to cut intercity journey times from hours to minutes.
Hyperloop One has become the most prominent of a handful of start-ups investing in the technology and has raised hundreds of millions of dollars to make it a reality.
Last year, Sir Richard’s Virgin Group invested an undisclosed amount in the company and renamed it Virgin Hyperloop One, with the British billionaire joining as chairman. Sir Richard stepped down last month and on Thursday was succeeded as chairman by Sultan Ahmed bin Sulayem, the head of the Dubai shipping giant DP World, which is its largest investor. Virgin Hyperloop One’s chief executive, Rob Lloyd, has been replaced by Jay Walder, a former Transport for London managing director
The Telegraph understands that the company’s top executives were let go on Thursday. They include its chief engineer, Rob Ferber, and its head of systems engineering, Anita Sengupta. Axel Martinez, the company’s chief financial officer, is believed to be leaving in the coming weeks.
They join a string of senior departures this year that has included HR chief Ramiro Medina, hardware boss Carl Jenkins, and software head Matt Jones. One source said the company was surviving on support from investors including DP World.
It is seeking a major new funding round or a contract with a government body to build a fully operational hyperloop, with a proposed system in India between Mumbai and Pune seen as the most promising bid.
Shortly before Sir Richard left, he cancelled a planned Saudi investment in two other Virgin ventures: Virgin Galactic and Virgin Orbit; amid controversy over the killing of the dissident journalist Jamal Khashoggi.
Hyperloop One is understood to have viewed Saudi Arabia as a potential backer and Sir Richard’s decision caught it by surprise, forcing executives to pull out of a planned conference in Riyadh.
A Virgin Hyperloop One spokesman said: “As we transition from a technology start-up to a mass transportation company, the strategy needs to focus on project commercialisation starting in India. We unfortunately had to part ways with some employees as we continue to evolve. We are focused on implementing the world’s first hyperloop system running from Pune to Mumbai and need to make sure that we spend our resources in ways that move that project forward.
“As for funding, we just received a new round of funding from our current investors with the goal of breaking ground on our first project in India in the first half of next year.”