The Boring Company’s new funding, announced Wednesday, comes from venture capital firms as well as real estate companies. Sequoia, a well-known Silicon Valley company that previously invested in Musk, co-led the investment with Vy Capital. The deal values the Boring Company at nearly $5.7 billion.
Loop is mostly Underground transportation system that provides point-to-point rides between train stations where people board Tesla SUVs. A loop system is already in operation in Las Vegas with two stations at the Las Vegas Convention Center about a mile apart. There are plans to expand the system to cover the entire Vegas Strip, with 51 stations spread over 29 miles. The Boring Company is also developing a project in Fort Lauderdale, Florida and is in discussions with San Antonio, Texas. It has already announced but not yet finalized projects in Chicago, Washington, DC and Los Angeles. It faced a lawsuit from disaffected Los Angeles neighbors and fell out of favor when Chicago elected a new mayor. Permits are pending for the DC to Baltimore project, which dates back to 2017.
“We’re still very enthusiastic and want to move forward,” Fort Lauderdale Mayor Dean Trantalis told CNN Business on Thursday.
He said the government is working with the Boring Company on technical issues of the project that would connect downtown and a nearby beach. They are working to align the route with a right of way over which the city has more control. He didn’t want to say when it might be finished.
Critics have questioned whether running a subway system, but with cars instead of trains, is an efficient use of tunnels, which can cost up to $1 billion per mile to build. The Boring Company says it is developing cheaper tunneling technology and argues its system is superior to traditional subway systems because journeys are point-to-point and don’t make scheduled stops like at other stations. (But they could possibly be slowed down by tunnel traffic in front of them.)
Musk, the CEO of Tesla, had previously unveiled a more grandiose vision for the Boring Company, which would see people being propelled through cities at speeds of up to 120 miles per hour in special autonomous vehicles. But the reality so far, at least in Las Vegas, has to do with human drivers driving at 35mph, which is similar to standard Teslas.
The Boring Company still says it plans to eventually move to fully autonomous operations, which will reduce operational costs.
Sequoia said in a blog post that the Boring Company is at a “tipping point.”
“The next few years will be about increasing performance tenfold by making their systems rapidly reusable and fully autonomous,” the company wrote.
The Boring Company says its next-generation tunnel-digging machine is designed to be able to operate remotely and autonomously, without anyone having to be in the tunnel. The current iteration of the machine, called the Prufrock, is designed to dig up to a mile per week. Digging tunnels faster is crucial to reducing costs.
The Boring Company has announced plans to build utility and cargo tunnels as well. It did not respond to a request for comment.