Earlier this week a blog post was published on the World Economic Forum Agenda discussing the potential impact of a new mode of transport on the logistics industry. The post, featured below, was written by Wolfgang Lehmacher and sparked discussion at Ti about what the future of our industry might look like.
Currently Ti publishes annual reports focussed on the development and evolving structures of the Freight Forwarding, Contract Logistics and Express markets. In the future, might we be publishing analysis of super-fast pipeline logistics?
Ti’s resident technology expert and board member, Ken Lyon, had this to say:
“This concept is very exciting, but must be tempered with a dose of reality. Firstly, the science involved (especially the physics) is reasonably well founded, but it is still work in progress. The prototyping of the initial hyperloop is still in testing.
Secondly, it is encouraging that the Dubai/Abu-Dhabi project was signed in the past week or so, but this is similar in scope to the existing (and operating) Shanghai Maglev train out to the airport from the city centre. This is how this technology will develop, with various small scale pilots informing how large scale projects should be built.
Finally, will they be built? This is largely a matter of political will and cost. A transcontinental project as is suggested by this article (below) is obviously possible if these two conditions can be addressed. At present the Russian Federation is focused on funding to it’s military capabilities with no spare capital. China, on the other hand, has some capability to contribute to the funding of such a project and may be very interested in the political signal it will send, but it will need partners. At present, those partners are a long way from being able to contribute.
In short, great idea and probably viable, but more likely to be realised with local/regional projects over the next decade.”
The world’s fastest mode of transport could soon be here
I believe a fascinating new mode of transport is at the horizon. Imagine if it only took a day for products to travel over land from China to Germany.
It could soon be a reality, if Russia goes ahead with a plan to introduce a new fast-speed pipeline called the Hyperloop. Much as oil and gas travel through pipes, cargo and passengers may soon find themselves shooting through pneumatic tubes at speeds of up to 760 miles per hour.
Tech entrepreneur Elon Musk once envisioned a tube transportation project that could move passengers and cargo from San Francisco to Los Angeles in 30 minutes. Two companies – Hyperloop One (formerly Hyperloop Technologies) and Hyperloop Transportation Technologies (HTT) – are now exploring Musk’s idea with a view to building the first transport-ready tube by 2020. According to the chief executive officer of Hyperloop One, feasibility studies have been launched not only in Russia but also in the United Arab Emirates, Finland, the United Kingdom and the United States.
Hyperloop One has joined forces with the city of Moscow and Summa Group, a local investment and construction conglomerate, to bring the vacuum tube to Russia.
So what are the benefits?
Air transportation is fast but costly, so most cargo is shipped by sea. To travel by sea between Asia and Europe can take around 30 days – and that’s without considering overland transport to and from the ports. Rail transportation takes nearly half that.
The southern rail route between China and Russia is 6,213 miles long and takes 12 days, while an 8,077-mile northern rail route through Russia takes 16 days. Can the Hyperloop ultimately provide the quickest transportation option, at affordable cost?
Construction costs are important to consider. Building and operating a Hyperloop is estimated to be in a similar range as building and operating high-speed rail infrastructure and trains. The construction cost for high-speed rail lines, such as the Haikou-Sanya line in China and Madrid-Albacete line in Spain, come in at about US$15 million a mile.
Elon Musk suggested that a San Francisco-Los Angeles Hyperloop would cost $11.5 million a mile. Hyperloop One estimates the cost of building the vacuum tube to be anywhere between $5 million and $20 million a mile. However, the cost might be much higher if instead of pressurized air generated by compressors (as proposed by Musk) the more expensive magnetic levitation technology is installed, using powerful electromagnets to lift the train carriages. The 19-mile “maglev” line in Shanghai has cost $63 million a mile, and a proposed 178-mile track in Japan is expected to cost roughly $250 million a mile.
Earlier this year, HTT announced an exclusive deal to license passive magnetic levitation technology, which would eliminate the need for power stations along the track and could therefore lower operating costs. Also, HTT had filed permits in Kings County, California to build a five-mile test track. Hyperloop One tested the propulsion mechanism on 11 May 2016 in Nevada. Although the test result can be considered a first proof of concept, the outcome isn’t yet clear as the demonstration focused only on one part of the complex solution.
The race is on. But a project the size of the Transonic Silk Road would require sizeable political and financial support from China. Initial interest seems to exist: CRRC Corp, China’s largest maker of railway equipment, has apparently been in talks for a potential investment in Hyperloop One, according to a Bloomberg report earlier this year.
Depending on these developments, the Belt and Road initiative might soon connect Asia and Europe overnight by the Hyperloop, potentially requiring a quick name change from Belt and Road to Belt and Tube.
This article was originally posted on the World Economic Forum Agenda.
Author: Wolfgang Lehmacher, Head of Supply Chain and Transport Industries, World Economic Forum
For more analysis on innovations within the industry as they happen, be they to the scale of the potential Transonic Silk Road, or a new way of thinking about data sharing, look through our Logistics Briefings, whitepapers and other publication on www.ti-insight.com. Alternatively, contact Michael Clover for a demo of GSCi, The world’s largest collection of global supply chain intelligence.
Source: Transport Intelligence, November 10, 2016
GLOBAL SUPPLY CHAIN INTELLIGENCE (GSCi)