Only last week we reported that The Boring Company was planning on extending its Loop tunnels for Teslas in Las Vegas. Planning files have revealed that Loop's three stations will be able to just transport 800 passengers per hour and this may max out at 1200 passengers per hour. This pegs the system to operate at just 1/4th of its capacity which is also the basis on which LCVCA granted the Boring Company its contract.
The LVCC Loop would transport attendees to the conversion centre using two 0.8 mile underground tunnels ferry people in Teslas. Fire regulations are turning out to be one of the major stumbling blocks. If the Boring Company misses its target then it may not recover more than the $13 million of its construction budget and may face millions in penalties once the system is activated.
While Musk has showcased a short-range Loop in Los Angeles, the LVCC Loop will be the first system deployed for the public. Already an analysis by Vegas Mayor Carolyn Goodman revealed that the system was unproven and could represent a major risk for the LVCVA. But they went ahead with the contract anyway but incorporated a model in the contract that incentivised Musk to deliver on the grand promise of the Boring Company.
The system was supposed to be ready by October 1 so that it would be ready for the 2021 Consumer Electronics Show (CES) - though for 2021 it has gone virtual thanks to the COVID-19 pandemic.
The staggered payout structure means that once the stations are completed the Boring Company would have received 30 per cent of the payout. When the entire working system is deployed the payout would be over $10 million. If the Loop can carry 2,200 people, The boring Company will get $4.4 million, then the same payment for hitting 3,300 people and 4,400 people. The capacity payments represent 30 per cent of the fixed price of the contract.