Dr.

Vishwanath Karad MIT World Peace University

MBA PROGRAMME
CASE STUDY

Business Analysis: Case No. 2

Building the Hyperloop in

India

Every day over 130,000 vehicles travel the two- to three-hour journey between Mumbai, the financial center of the
Indian State of Maharashtra, and Pune, the cultural capital known as the ‘Oxford of the East’ and home to growing
automotive and IT sectors. As the population in the area increases, so do the traffic and emissions, making the corridor
one of the State’s top infrastructure priorities.

Recognizing the tremendous transportation need in this corridor, the Indian State of Maharashtra has announced their
intent to build a hyperloop between the two cities and signed a historic agreement with Virgin Hyperloop One. The
hyperloop route developed would link central Pune, Navi-Mumbai International Airport, and Mumbai in 25-minutes,
eventually enabling 150 million journeys and reducing greenhouse gases by 150,000 tons annually. The system would
also have the potential for the rapid movement of palletized freight and light cargo between the Port of Mumbai and
Pune, creating a robust freight backbone in the region.

At the helm of this ambitious project is the Pune Metropolitan Region Development Authority (PMRDA) and its CEO
Kiran Gitte. PMRDA looks to solve the State’s most significant infrastructure gaps and helps the State keep pace with
the next 40 - 50 years of transport demand. Gitte recently shared his perspectives as to how Virgin Hyperloop One
systems could benefit the region economically and socially.

Virgin Hyperloop One: Can you paint us a picture of what the transportation demand is like between Pune and
Mumbai?

Gitte: Mumbai and Pune are the two largest cities in the Maharashtra State. Not only Maharashtra, but if you look at
India, it’s one of the busiest transport corridors in the country. There is a very high-density of traffic between the two
cities. We want to establish superfast connectivity. Specifically, we want to look at futuristic technology which can
handle not only the present traffic but also the exponential growth which we'll see in these two cities. For that, we
believe that hyperloop is the best technology available. In the last two to three months, we've had a very exciting pre-
feasibility study, and I think the Mumbai-Pune region will be the first in the country which will see this hyperloop
implemented. I think the geography demands it and the demography also demands it. The technology solution provided
with hyperloop will solve many of the problems that we have on our hands.

Virgin Hyperloop One: How will hyperloop change the relationship between Pune and Mumbai?

Gitte: With hyperloop, we are connecting the two metro hubs. Both Mumbai and Pune have mass, rapid transport
systems for intra-city movement. Within Mumbai, there are ten metro lines, and in Pune there are three lines. These
lines connect the intra-city movement of the citizens. For inter-city movement, we will take the central part of Pune and
central part of Mumbai and connect these two metro cities, which today have more than 25 million people and are
rapidly growing. With these two metro cities, about 2.5 crore population will benefit by point-to-point connectivity with
hyperloop and intra-city movement provided by the mass transit system.

Virgin Hyperloop One: How will this project impact Pune & Mumbai residents?

Gitte: Today, Mumbai is a more crowded place to live in because of land availability, and the city is built on a group of
islands. If you want to live in Mumbai, you have to live in a suburb more than two hours from the central part of the
city. Recently, there has been a paradigm shift because people commute the Mumbai-Pune route daily. And, this is
going to increase because the expansion of both the Mumbai metro region and the Pune metro region that is happening
at a very rapid pace. Now, these two cities are magnets attracting individuals further from all the states of India - it is
not limited to Maharashtra.

We think hyperloop will have a huge impact on the economy of the region as a destination, and because of the climatic
advantage that Pune has. Many people would like to stay in Pune and work in Mumbai which is not possible today.
Also, there are business people who like to commute between these two cities. The time required to go to an airport,

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work, and then come back to the airport, and go back to the city is not cultural time-permitting. So, I think of the time
value of money of the people because there is an economy of scale which you can take advantage of hyperloop. There
is a huge impact on the industrial scenario and transportation scenario. The whole economic region will get a boost
because of the hyperloop project.

Virgin Hyperloop One: How do local citizens feel about hyperloop?

Gitte: There is a lot of excitement among the young population, students, and the children born in the millennium --
those who do not have a lot of time or a lot of money. You need to understand, even for the common people in
Mumbai, the average commuter spends at least two-and-a-half to three hours every day traveling. And, when you count
between cities, it's about five hours.

Locally, the technology is the fascination. Some people believe in the project; some people think it's fiction. However,
we’re on the verge of having a city-to-city connection, and we will have a demonstration track between the route so that
people can come and see what kind of experience hyperloop can provide, which is truly a 21st-century phenomena.
Once people see what’s possible and when people are attracted, I believe they will have huge expectations from the
project. People living here should know that this project is super-fast, safe

Virgin Hyperloop One: You talk about how the economy will get a boost, how will the project impact the State’s
economic centers?

Gitte: The economy of Pune and Mumbai, they’re our two primary economic centers. They form about 25 to 30 percent
of the State’s GDP. I think this project will have a dramatic impact on the economy in terms of manufacturing the
hyperloop and impacting regional supply chain. In the coming years, we will see more than 15,000 jobs, both direct and
indirect, coming from this project. Hyperloop can impact just-in-time supply chain because we think just-in-time
confers relative position, security, and assurance of shipments.

Typically, the GDP growth rate which we have today is around eight to nine percent in the Mumbai economic region.
The hyperloop project has the capacity to increase the GDP after funding by two percentage points in growth every
year. Huge economies of scale will come from the hyperloop project.

Virgin Hyperloop One: How are you going to overcome the challenges of such an ambitious project?

Gitte: Virgin Hyperloop One agrees that Pune-Mumbai is one of the best corridors that we have for this project in the
whole world. But, there are definitely challenges. Between Mumbai and Pune, land is very, very costly. I think once we
have a larger picture, the framework we are working on, we will deal with this. We will deal with it with the
technology, the most modern technology developed, balancing this with the ecology, the passengers, and their existing

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concerns. And, then I think these additional challenges will disappear. There will be challenges in any transportation
project. Hyperloop will need additional safety regulations and standards to meet the current age of technology. The
technology development team at Virgin Hyperloop One has been very capable with the support of the government of
Maharashtra, Pune, India, and the PM office. I’m confident that we have the right team to work on any challenges in
times to come.

Virgin Hyperloop One: What would you say to the skeptics who might question embracing a new technology ahead of
some of the other projects in the State?

Gitte: I would like to say to all the people in this region who have some questions regarding the quality of the
technology and any safety issues. This is a part of any project. Understand that we have completed the pre-feasibility
report within six-weeks. We are committed to complete the feasibility study in six-months with Virgin Hyperloop One.
At the same time, within our state, many companies are committed to developing this project. I think that the
technology and demonstration track will be very demonstrative. Our planned demonstration track and with further
testing, I think will help us to answer questions people may ask. The people who have questions in mind, we welcome
them. All people who have questions on the project can come to the demonstration track and see what we are doing.

https://hyperloop-one.com/blog/addressing-congestion-indias-most-bustling-corridor-pune-mumbai
https://virginhyperloop.com/

Hyperloop: the technology

The general idea of trains or other transportation traveling through evacuated tubes dates back more than a century,
although the atmospheric railway was never a commercial success. Developments in high-speed rail have historically
been impeded by the difficulties in managing friction and air resistance, both of which become substantial when
vehicles approach high speeds. The vactrain concept theoretically eliminates these obstacles by employing magnetically
levitating trains in evacuated (airless) or partly evacuated tubes, allowing for speeds of thousands of miles per hour.
However, the high cost of maglev and the difficulty of maintaining a vacuum over large distances have prevented this
type of system from ever being built. The Hyperloop resembles a vactrain system but operates at approximately one
millibar (100 Pa) of pressure.

Hyperloop is a sealed tube or system of tubes with low air pressure through which a pod may travel substantially free of
air resistance or friction. The Hyperloop could convey people or objects at airline or hypersonic speeds while being
very energy efficient. This would drastically reduce travel times versus trains as well as planes over distances of under
approximately 1,500 kilometers (930 miles).

The Hyperloop Alpha concept was first published in August 2013, proposing and examining a route running from the

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Los Angeles region to the San Francisco Bay Area, roughly following the Interstate 5 corridor. The Hyperloop Genesis
paper conceived of a hyperloop system that would propel passengers along the 350-mile (560 km) route at a speed of
760 mph (1,200 km/h), allowing for a travel time of 35 minutes, which is considerably faster than current rail or air
travel times.

Videos:
https://www.youtube.com/watch?v=O_FyOBCVGWE
https://www.youtube.com/watch?v=zcikLQZI5wQ

Questions for discussion:

1. Do we need the soft system approach or hard system approach or both?
2. Who are the competitors of Hyperloop? Do a SWOT analysis for all competitors.
3. What attributes and features should the Hyperloop have to become a commercial success?
4. Do a CATWOE analysis and identify critical success factors.
5. Find out what features should be included.
6. Is there a technical innovation only or also business model innovation?

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