San Diego Virgin Hyperloop One

POLITECNICO DI MILANO

School of Architecture Urban Planning Construction Engineering

Master of Science - Management of Built Environment

POTENTIAL EFFECTS OF AN INNOVATIVE TRANSPORTATION PROJECT: THE CASE OF LOS ANGELES – SAN DIEGO VIRGIN HYPERLOOP ONE

Supervisors: Prof. Roberta Capello Prof. Andrea Antonio Caragliu

Student: Omer Sular Matric. N. 862739

Academic Year 2017/2018

Index

List of Figures ...... 5

List of Tables ...... 7

Abstract ...... 9

Acknowledgements ...... 11

Chapter 1: Introduction ...... 13

Chapter 2: What Is Hyperloop? ...... 17

2.1. Hyperloop Technology ...... 17

2.2. Virgin Hyperloop One ...... 19

2.3. Vision for America and Routes ...... 26

Chapter 3: General Characteristics of Airports in Los Angeles ...... 29

3.1. Airport Analysis for Los Angeles ...... 29

Chapter 4: Non-Market Valuation Methods ...... 35

4.1. Non-Market Valuation ...... 35

4.2. Branches of Non-Market Valuation ...... 36

4.2.1. Revealed Preference Method ...... 36

4.2.2. Stated Preference Method ...... 38

Chapter 5: Survey Questionnaire ...... 41

5.1. Aim ...... 41

5.2. Method ...... 41

5.3. Assessment of the Structure of the Questionnaire ...... 44

Chapter 6: Questionnaire Evaluation ...... 47 6.1. Age ...... 48

6.2. Income Level ...... 49

6.3. Education Level...... 50

6.4. Travel Frequency from Los Angeles to San Diego ...... 51

6.5. Rate of Flying ...... 52

6.6. Willingness to Pay for Hyperloop ...... 53

6.7. Willingness to Pay More of People on Changed Route ...... 54

Chapter 7: Conclusion...... 59

Bibliography ...... 63

List of Figures

Figure 1: How Hyperloop system works

Figure 2: Elon Musk at Cross Campus in Santa Monica, CA for PandoMonthly LA event on the day when he shared his idea about Hyperloop in 2012

Figure 3: Virgin Hyperloop One Headquarters in Los Angeles

Figure 4: Virgin Hyperloop One Test Field in Las Vegas

Figure 5: Brogan BamBrogan and Shervin Pishevar

Figure 6: Rob Lloyd, CEO of Hyperloop One

Figure 7: Stockholm – Helsinki Vision of Hyperloop One

Figure 8: Vision for Jebel Ali Port

Figure 9: Simulated design for Dubai – Abu Dhabi link vision

Figure 10: Vision for India

Figure 11: Los Angeles – San Diego Hyperloop One Route Vision

Figure 12: Location of Los Angeles City

Figure 13: Los Angeles International Airport – LAX

Figure 14: Tom Bradley International Terminal (TBIT)

Figure 15: To have a garden is one of the various factors, which affect the environmental quality of a house

Figure 16: The value of a wildlife watching camp area can be estimated with Travel Cost Method

Figure 17: Face-to-Face Questionnaire Application

Figure 18: Scores can be given to options and ranged from best to worst in choice modelling

Figure 19: Questionnaire template

Figure 20: Age results of the survey

Figure 21: Income level results of the survey

Figure 22: Education level results of the survey as percentage

Figure 23: Travel frequency to San Diego results of the survey

Figure 24: Flying rate result of the survey

Figure 25: Willingness to pay results of the survey

Figure 26: Willingness to pay more results of the survey

Figure 27: Location of LAX and Downtown Los Angeles

Figure 28: City of Los Angeles and Communities

List of Tables

Table 1: Commercial Airports of Los Angeles

Table 2: Airline Companies which have flights to San Diego

Table 3: Distance Analysis

Abstract

This dissertation involves discovering the potential effects of Hyperloop technologies in the future and the analysis of what needs to be considered when it comes to provide a better service for generating higher profit and creating sustainability. The main objective of this work is to show that potential customers’ decision and actions on a new project can make a difference in terms of pricing, sustainability and utilizability. This has been done by following the rules of contingent valuation method and applying on-site survey analysis in Los Angeles, that is the one of the candidate city for the Hyperloop, and the result of this survey used as a case study for this research. Upon examining the results of the questionnaires, it becomes clear that potential customers of this project are considering paying more than the price which was initially proposed in the white paper by Elon Musk who came up with the idea of Hyperloop. Furthermore, the research also shows that the total amount of the price that people are willing to pay is going to increase if it is located in Downtown of Los Angeles instead of Los Angeles International Airport (LAX). Through showing that the Hyperloop technologies are going to connect built environments and cities to each other all around the world in the future, this research highlights the importance of the participation of potential users in decision-making in public projects in order to find out the best solution for both providers and users.

Acknowledgements

I would like to express my gratitude to my supervisors Roberta Capello and Andrea Antonio Caragliu for their useful comments, remarks and engagement through the learning process of this master dissertation. Furthermore, I would like to thank Elon Musk for influencing me and introducing me to the topic as well for the support on the way with his personality as an influencer and extraordinary successful life. In addition, I would like to thank the participants in my survey, who have willingly shared their precious time during the process of interviewing. I would like to thank my loved ones, and especially my dad, my mom and my brother who have supported me throughout the entire process, both by keeping me harmonious and helping me putting pieces together. I will be grateful forever for your love.

Chapter 1

Introduction

Every changes constantly happening in the dynamic cities affect the natural, built, socio-economical and socio-cultural factors. These changes are the results of the policies which are driven by the governments or businesses.

Policy makers are the representatives who are elected by different parts of the community in order to ensure the common interest of that community. Although politicians try to make the best possible decisions based on the whole public interest, they still have to protect their relation with the community day by day. They need to actively follow the changes, evaluate the policies that they want to apply primarily, and to change them when it is necessary.

Public is always a balancing factor for every policy, a project gets a value or not based on public reaction. Because of this reason, collaborative planning and public’s participation in every step of a project is essential to make it accepted by their potential users.

Trade off among different options occurs because of many reasons when preparing a new policy, but saving time is the most important factor, nowadays. In

13 the 21st century, high speed and easy access to every field has gained so much interest at the public in almost every field. Internet is a good example of getting information quickly and performing communication easily. For instance, an employee or a group of employees of a company from Japan can have a meeting in the same room with someone who is in a different place like France at the same time via Internet by using video conferencing without the need to come together physically in the same room.

Although Internet provides an easy solution for communication and getting things done without traveling, there is a necessity to travel to other cities for several reasons. Internet might be the service through which most of the activities can be done, but still people want to sense the activities and experience them physically. These reasons which make people eager to be mobilized may be:

. to see the lifestyle of the people who live in other cities, . to see new places which have specific characteristic, . to observe the facts which they watch on the news, . to join specific events and activities, . to break the monotony of daily routines, . to satisfy the spiritual feelings, . to see the homeland, . to see the places which their parents or friends have already visited, . weather conditions, . willingness to learn, . sport, . economic (to live in cheaper city), . adventure, . work, . enjoyment, . health, . desiring a change,

. to take a rest and to relax, . to get prestige, . shopping, . gambling.

In a limited time, people can do many activities or just a single activity. Depending on the time they have, people put them in an order with respect to their desire. They already know what their priorities are, and they calculate how much time they can take. If they cannot schedule their activities into a limited time, they do trade off for some activities or postpone them. Those changes on the plan may derive from priority importance or monetary value of the activities, but the most important problem may be due to spending time unwillingly on unavoidable activity like transportation.

As an urban planner, I am always interested in innovative projects that have a possibility to change people’s daily life and their movement completely. From this aspect, I have first started to follow the news that is related to Hyperloop technology when it came to the fore by Elon Musk. After his Hyperloop idea became realistic and started to be developed by some companies, it became more important for me.

Hyperloop is an innovative and a new transportation system in the world. The feature that makes Hyperloop innovative is its speed. Based on early estimates, it will be faster than commercial jet airplanes with its 760 mph/h (1,200 km/h) speed when the project is completed.

In this research, Los Angeles- San Diego route which is planned to be developed by Virgin Hyperloop One Company was analyzed. Company’s aim is to connect Los Angeles International Airport (LAX) to San Diego International Airport (SAN). According to the company, the main objective of this project is to transform two or more airports, which are operated separately at different locations, into a system managed from a single center by making them connected easily.

High-speed transportation connection will ensure this. On the other hand, this project requires a high-level investment because of its high cost, therefore continuous and sustained use of this project is extremely important in order to cover all costs and to start making profit to increase trust among investors and invest on other cases.

The main objective of this dissertation is to evaluate an alternative route against the currently planned one and to understand the willingness to pay of potential users of the project and whether they are willing to pay more for alternative route or not. In order to understand the willingness to pay of people, face-to-face surveys were conducted with the people living in Los Angeles. The results of the survey were evaluated by contingent valuation method, and lastly, all work was finalized.

Chapter 2

What Is Hyperloop?

2.1. Hyperloop Technology

Hyperloop is the fifth mode of transportation system in the world after boats, trains, trucks and automobiles, and airplanes. Passengers and/or cargos are going to be carried from one point to another by pods through tubes with very high speed. Vacuum tubes using magnets will ensure that the pods will go through the tubes with 760 mph/h (1,200 km/h) speed when they start to work [1]. On the other hand, transportation is going to be cheaper and easier than airplane transportation. Pods are going to carry six to eight people in every 30 seconds and tickets’ price will be around $20 per person [2].

Figure 1: How Hyperloop system works (https://tctechcrunch2011.files.wordpress.com/2016/07/hyperloop-one-parts.png) Hyperloop idea was firstly proposed by Elon Musk who is the founder, CEO, and lead designer of SpaceX; co-founder, CEO, and product architect of Tesla, Inc.; chairman of SolarCity; and the founder of The Boring Company, at Cross Campus in Santa Monica, CA for PandoMonthly LA event in 2012(Figure 2) and he said that it may be the fifth dimension of transportation which can arrive to San Francisco in 30 minutes from Los Angeles [3].

After this event in August 2013, Elon Musk and entrepreneur Shervin Pishevar presented the Hyperloop Alpha to former President Barack Obama and his science advisors, and the project was defined as executable [4].

Figure 2: Elon Musk at Cross Campus in Santa Monica, CA for PandoMonthly LA event on the day when he shared his idea about Hyperloop in 2012 (http://img.new.livestream.com/events/ 00000000000f0fc2/d88ffa62-31a3-4062- ac94-a58aac3622e5.jpg)

2.2. Virgin Hyperloop One

Virgin Hyperloop One is an American company that is one of the companies which works on Hyperloop technology. Company’s headquarter is located in Los Angeles, California and test field is located in Las Vegas, Nevada. Virgin Hyperloop One is the first and only company in the world that has built a full-scale hyperloop system and run the first successful test. In the last test, pod has been reached to 240 mph (387 km/h) [5].

Figure 3: Virgin Hyperloop One Headquarters in Los Angeles (https://pbs.twimg.com/media/DVDUtU-UQAEVWHq.jpg)

Figure 4: Virgin Hyperloop One Test Field in Las Vegas(https://pictures. topspeed.com/IMG/jpg/201704/will-hyperloop-one-r-11.jpg) History Although Elon Musk is the one who developed the idea; however, he did not incorporate the Hyperloop One Company and is not the founder of the company, but Shervin Pishevar is. Shervin Pishevar, American-Iranian venture investor and Brogan BamBrogan, a former SpaceX engineer are the co-founders of the Hyperloop One (Figure 5), and the company was founded in June 2014.

Figure 5: Brogan BamBrogan and Shervin Pishevar (http://www1.pictures.zimbio.com/)

The development of Hyperloop Technology has been started in the garage of Brogan Bambrogan in June 2014, then it was carried to current headquarter named as Hyperloop One Innovation Campus, in December 2014.

As of September 2015, Rob Lloyd, former president of sales and development at Cisco Systems Incorporated that develops high-tech services and products generally related to networking and telecommunication, became the CEO of Hyperloop One. In his first blog post as CEO, he said: ”Hyperloop is going to build partnerships with some of the largest engineering, construction and transportation companies in the world. We will embrace a design/build/transfer and operate business model, and will create a powerful ecosystem to quickly deliver the Hyperloop platform.” [6].

Figure 6: Rob Lloyd, CEO of Hyperloop One (http://www.afr.com)

In December 2015, Apex Test and Safety site, that is located outside of North Las Vegas, Nevada, was chosen to start the first full system, full scale, and full speed test [7]. Hyperloop Technologies accomplished its first Propulsion System Open Air (POAT) test on May 11, 2016. 136 mph speed was reached in 2.2 seconds. In the same month, company changed its name to Hyperloop One and announced that they are the only company that develops full-system Hyperloop [8].

After the successful tests and ongoing raised funds, company representatives started to build relationship with the professionals who work in transportation companies, ministries and government representatives from different countries and created new visions with them through events and meetings for mutual consultation.

Figure 7: Stockholm – Helsinki Vision of Hyperloop One (http://www.inverse.com)

Events and meetings were firstly organized with FS Links and KPMG in July 2016 in order to achieve 28-minute link between Kista Science Park Station that is located in Stockholm, Sweden and Central Station that is located in Helsinki, Finland (Figure 7). Secondly, in August 2016, DP World company from United Arab Emirates, which has Sultan Ahmed bin Sulayemas CEO and operates logistics and technology driven trade solutions, and Hyperloop had agreement in order to upgrade Jebel Ali Port’s performance and profitability (Figure 8).

Figure 8: Vision for Jebel Ali Port (Protenders)

In November 2016, Dubai's Roads and Transport Authority (RTA), which also works under government from United Arab Emirates, and Hyperloop One had agreement for the evaluation of the vision to connect Dubai and Abu Dhabi. In this vision (Figure 9), travel time will be decreased from more than 90 minutes to 12 minutes.

Figure 9: Simulated design for Dubai – Abu Dhabi link vision (http://www.gulfbusiness.com)

After those meetings, another one was held with Indian representatives in February 2017 to inform them about the vision for India during Hyperloop One Global Challenge. In this event, the Minister of Railways, Suresh Prabhu, and the CEO of NITI Aayog, Amitabh Kant followed the ideas of semifinalists on Indian transportation system with hyperloop technology.

Figure 10: Vision for India (https://www.indiatimes.com)

2.3. Vision for America and Routes

In April 2017, the vision of America, and in June 2017 the vision of Europe were announced publicly. If we take a look at the proposals in the Hyperloop One Global Challenge, there are 11 routes for United States of America [9]. Those are:

. Boston-Somerset-Providence (64 miles)

. Cheyenne-Houston (1,152 miles) . Chicago-Columbus-Pittsburgh (488 miles) . Colorado Front Range/Mtn. Network (360 miles) . Colroado Front Range (242 miles) . Kansas City-St. Louis (240 miles) . Los Angeles-San Diego (121 miles) (Figure 11) . Miami-Orlando (257 miles) . Reno-Las Vegas (454 miles) . Seattle-Portland (173 miles) . Texas Triangle (640 miles)

Figure 11: Los Angeles – San Diego Hyperloop One Route Vision (https://www.futurism.com) In this research, the most efficient station locations that have different function in Los Angeles and San Diego will be chosen to ensure sustainability, profitability, and efficiency in use for the future of the cities and the people who will live there. Two options will be evaluated:

. Airport to Airport Connection . Central Business District to Central Business District Connection

Chapter 3

General Characteristics of Airports in Los Angeles

3.1. Airport Analysis for Los Angeles

Los Angeles is one of the largest cities of the United States of America and the world with its 3,976,322 population (2016) [10]. Los Angeles is a city of California State, which is located in southeast part by the Pacific Ocean of the United States of America. It is the second most populous city and metropolitan area (after New York City) in the United States [11].

Figure 12: Location of Los Angeles City (http://www.whereig.com)

Los Angeles is the center of entertainment of the United States, but not limited with it as well. By the end of the 20th century, the fastest-growing sectors for employment were construction, transportation, public utilities, finance, insurance, real estate, and government services [11].

Los Angeles is served by interstate buses and Amtrak intercity passenger rail service, but air travel is by far the most important transport link to the outside of the region. Los Angeles International Airport (popularly called by its international code, LAX) is one of the world’s largest airports, handling tens of millions of passengers and millions of tons of freight annually. Traffic at LAX keeps rising, but proposals to expand the facility evoke strong opposition from surrounding communities [11].

Figure 13: Los Angeles International Airport – LAX (http://www.hsecontractors.com)

Los Angeles has several commercial airports, which serve for international and domestic flights, and municipal and commuter airports. The list of commercial airports of Los Angeles is presented in the table below.

Table 1: Commercial Airports of Los Angeles

Airport Name International / Flight Domestic to San Diego Los Angeles International Airport - International and Yes (LAX) Domestic Ontario International Airport - (ONT) International and No Domestic John Wayne Airport - (SNA) International and No Domestic

San Bernardino International Airport - International and No (SBD) Domestic Palm Springs International Airport - International and No (PSP) Domestic Hollywood Burbank Airport – (BUR) Domestic No Long Beach Airport - (LGB) Domestic No

Los Angeles International Airport (LAX) is the only airport, which has flights to San Diego. Airline companies with flight services between Los Angeles – San Diego are listed below (see table 2.).

Table 2: Airline Companies which have flights to San Diego

AIRLINE COMPANY NAME American Eagle Delta Air Lines Delta Connection United Airlines United Express

LAX offers direct flights from 101 domestic cities and 77 international destinations. LAX is the seventh busiest passenger airport in the world [12]. In 2014, 70.7 million passengers traveled through LAX and the total aircraft operations were 637,000.According to the Centre for Aviation (CAPA) Airport Construction 2015 Mid-year Review, Los Angeles International Airport (LAX) is currently undergoing several improvement projects, with the largest being the new Tom Bradley International Terminal (TBIT) project. Improvements include doubling the capacity of the terminal to 1.2 million square feet with 18 new gates, nine of which will accommodate larger aircrafts, such as Airbus 380 super jumbo jet, Boeing 747-8 Intercontinental, and Boeing 787 Dreamliner, premier dining and

32 shopping, and expanded federal customs and immigration screening areas. The total cost for the new TBIT is $1.9 billion, up from $1.5 billion, which is due to the addition of several individual projects that have been added to the TBIT project [13].

Figure 14: Tom Bradley International Terminal (TBIT) (https://www.archdaily.com/)

There is no universal definition for a hub [14], but in general, an airport hub is considered to be a large number of direct flights by one or more carriers. Based on the U.S. Federal (FAA), hub categories as defined in title 49 U.S.C., § 40102 (U.S. Department of Transportation Federal Aviation Administration, 2014) categorize hub size based on a percentage of the airport's share of traffic over the total passenger enplanements in the U.S. [13]

According to FAA, the benchmark airports San Diego International Airport (SAN), San Francisco International Airport (SFO), Seattle Tacoma International

Airport (SEA), Los Angeles International Airport (LAX) and Denver International Airport (DEN) are defined as large hub airports. [13].

Chapter 4

Non-Market Valuation Methods

4.1. Non-Market Valuation

Non-market valuation method is one of the most important ways to determine public projects’ cost and benefit with their potential exercise price of use. Non-market valuation exercises can be applied in many different areas, ranging from health and environmental applications to transport and public infrastructure projects. There are some goods which are not present in the market; therefore, their prices cannot be directly obtained from the market. As Alpizar, Carlsson and Martinsson stated:” Markets fail to exist for some goods either, because these goods simply do not exist yet, or because they are public goods, for which exclusion is not possible. Nevertheless, if one wants to compare different programs by using cost-benefit analysis, the change in the quality or quantity of the non-market goods should be expressed in monetary terms.” [15] Another crucial application of valuation techniques is the determination of damages associated with a certain event. Under the Comprehensive Environmental Response, Compensation and Liability Act of 1980 in the US, and after the events that followed the Exxon Valdez

35 oil spill in 1989, the methods of valuation have become a central part of litigation for environmental and health related damages in the United States and in several other countries.

4.2. Branches of Non-Market Valuation

There are two branches of non-market valuation to estimate the price of non-market goods. Those branches are: revealed preferences and stated preferences.

4.2.1. Revealed Preference Method

If the price of non-market good is calculated with one or more related market good’s prices which are not directly affecting, revealed preferences need to be taken into consideration as the method. It is important to understand that the market to be analyzed is closely related in order to come up with correct result. Basically, this method has two most well-known approaches which are hedonic pricing method and travel cost method.

4.2.1.1. Hedonic Pricing Method

The hedonic method uses observed market prices for composite (multi- attribute) goods with many characteristics that contribute to its value to uncover the value of particular characteristics for which there is no readily available signal of value. Many hedonic studies use data on sales prices of houses to estimate the value of various aspects of environmental quality (Figure15). Using data on the market sale prices of houses, along with structural, neighborhood, and environmental characteristics of the houses, one can estimate how a change in one characteristic, such as proximity to a wetland or the attributes of a nearby wetland (size or type), is related to a change in property value, holding other characteristics of the property constant. Urban areas are ideal for the application of this approach because there is typically a wealth of data available on house sales. [16]

Figure 15: To have a garden is one of the various factors, which affect the environmental quality of a house (http://www.euromotor.org/)

4.2.1.2. Travel Cost Method

The travel cost approach uses information about the number of trips to particular sites and the cost of those trips to infer how much individuals are willing to pay for access to the site. Travel cost studies are applied primarily to studies of the value of recreation, in which people travel to particular sites to hunt, fish, hike, or watch wildlife. (Figure 16) [16]

Figure 16: The value of a wildlife watching camp area can be estimated with Travel Cost Method (https://www.visitscotland.com/)

4.2.2. Stated Preference Method

If the value of non-market good is estimated with the survey analysis, which implements a questionnaire to a group of people in order to understand their willingness to pay for a project, stated preference method needs to be used as the method. In this method, the result of willingness to pay of an implementation is accepted as hypothetical. The method includes a number of different approaches such as conjoint analysis, contingent valuation method (CVM) and choice experiments [15].

4.2.2.1. Contingent Valuation Method (CVM)

In most applications, CVM has been the most commonly used approach. In particular, closed-ended CVM surveys have been used, in which respondents are asked whether or not they would be willing to pay a certain amount of money for

38 realizing the level of the non-market good described or, more precisely, the change in the level of the good [17]. The idea of CVM was first suggested by Ciriacy- Wantrup (1947), and the first study ever done was in 1961 by Davis (1963) [15]. Since then, CVM surveys have become one of the most commonly used methods for valuation of non-market goods, although its use has been questioned [18] [19]. At the same time, as CVM was developed, other types of stated preference techniques, such as choice experiments, evolved in both marketing and transport economics.

In this dissertation, contingent valuation method is used to understand which alternative is more efficient to make this project more sustainable and profitable. In order to reach this aim, face-to-face questionnaires were applied in Los Angeles.

Figure 17: Face-to-Face Questionnaire Application (http://www.thepinsta.com/)

4.2.2.2. Choice Modelling Method (CMM)

This model is similar to contingent valuation method. Representative individuals to be surveyed have to choose among some alternatives instead of stating the willingness to pay, explicitly.

They are usually asked to perform a sequence of such choices. Each alternative is described by a number of attributes or characteristics. A monetary value is included as one of the attributes, along with other attributes of importance, when describing the profile of the alternative presented. Thus, when individuals make their choice (Figure 18), they implicitly make trade-offs between the levels of the attributes in different alternatives presented in a choice set. [15]

Figure 18: Scores can be given to options and ranged from best to worst in choice modelling (http://www.hesaa.org)

Chapter 5

Survey Questionnaire

5.1. Aim

The aim of the survey questionnaire is to get the opinions of potential customers on preferable routes and their willingness to pay. Methods on application may be changed, but this is the only way to learn their preference. Because of the time and other source limitations, the survey questionnaire cannot be applied to each person who lives in the area, which is the object of the research. For this reason, the survey is limited to some group of people who live in that area. Questionnaire template can be seen below (Figure 19).

5.2. Method

Questions were answered and information was obtained from 81 individual participants. Questionnaire was applied with face-to-face method in several locations of Los Angeles County. It is an expensive method compared to other methods like phone, mail and internet surveys since it requires a flight to travel and

41 a place to stay on site. Each required section is explained by the interviewer to the participants. Full information could not be obtained, since the participants were not willing to give every information related to their private life. Consequently, name, living address and responses of other seven questions were obtained by the interviewer.

Figure 19: Questionnaire template

5.3. Assessment of the Structure of the Questionnaire

The first part of the questionnaire is related to personal information. In the personal information part, I wanted to learn the first and the last name, addresses, city, zip code, home phone and e-mail addresses of the participants. Phone number is necessary for communication if are data to complete or clarify later. E-mail address information is helpful to gather the attachments like documents, photos, notes etc., which would support the research and can be provided by the person who completed the survey. During these communications by phone and e-mail, the first and the last name of the participant can be used to call those people politely. In order to understand the distance of the participant's house to the planned and alternative stations of the Hyperloop in the city, I asked the address, city and zip code. In this part, I was only able to receive the first name and city information from the participants since they thought that others are confidential information. As I had the all clear answers in the last part of the questionnaire, the lack of those information did not affect the survey. I just could use the center of the city as home address instead of the exact location of their homes.

In the second part of the questionnaire, the information that I wanted to get is related to their employment. In this part, I wanted to learn the business name, business address, city, zip code, business phone number and corporate e-mail address of the participants. Business phone number is necessary to communicate with the participant during weekdays if there are data to complete or clarify later. E-mail address information is helpful to gather the attachments like documents, photos, notes etc., which would support the research and can be provided by the participant during the weekdays in case of urgency. In order to understand the distance of the participant's business location to the planned and alternative stations of the Hyperloop in the city, I asked the address, city and zip code. I was planning to add this information as secondary information to research to analyze travels for business reasons from office location to stations in case of daily activities related

44 to business, but I canceled it later due to the lack of data. In this part, I could not get any information from any observation in my first 15 tries and those questions were making the observations skeptical on the survey, so I canceled them for the rest of it.

In the last part of the questionnaire, I asked seven questions to the people who joined the survey. Those questions are:

1. WHAT IS YOUR AGE? 2. WHAT IS YOUR INCOME LEVEL? 3. WHAT IS THE HIGHEST EDUCATIONAL LEVEL THAT YOU REACHED? 4. HOW MANY TIMES DO YOU TRAVEL TO SAN DIEGO IN A YEAR? 5. DO YOU FLY FOR BUSINESS REASONS TO SAN DIEGO? 6. HOW MUCH WOULD YOU BE READY TO PAY IN ORDER TO SAVE TWO AND A HALF HOUR ON THE TRAVEL BETWEEN LA AND SAN DIEGO? 7. HOW MUCH MORE WOULD YOU WILLING TO PAY IN ORDER TO HAVE THE POSSIBILITY TO LEAVE FROM DOWNTOWN LA TO GO STRAIGHT TO DOWNTOWN SAN DIEGO?

Age is one of the most common demographic questions asked in surveys. How old a person is will often determine his/her knowledge and experience with the focus of the survey.

Income level information is helpful to understand the wealth level of a participant of the survey. In this way, I can see that the participant may use this transportation for every trip that could be done with Hyperloop more often without considering the cost of the trip and may use more than the amount that she/he declared.

To ask respondents what their highest level of education completed is often found on surveys. Respondents who completed a four-year degree at a college or university may answer questions differently compared to those whose education ended in high school because of understanding the value of technology and time.

To ask the number of travels they have in a year between Los Angeles and San Diego helps us to understand the rate of trips between these cities. In this way, the project can be seen as necessary, useful and sustainable.

To ask respondents whether they fly to San Diego or not can help to see whether the flight option is favorable or not. Answers to this question show us that people are willing to go to airport and spend their time for waiting, check in, etc. related to their flights instead of going by car, bus or train.

Last two questions (#6 and #7) are necessary to understand which route would be favorable for potential users. Depending on the answers, one of the options can be defined as more sustainable, useful and profitable.

Chapter 6

Questionnaire Evaluation

6.1. Age

Age

80+ 0 75 - 79 0 70 - 74 6 64 - 69 3 60 - 64 0 55 - 59 0 50 - 54 12 45 - 49 9 40 - 44 3 35 - 39 3 30 - 34 9 25 - 29 21 20 - 24 9 15 - 19 6 10 - 14 0 5 - 9 0 0 - 4 0

0 5 10 15 20 25

Age

Figure 20: Age results of the survey

In the survey, respondents’ age distribution can be seen in the graph. The weighted average value for age is 38.04. More than half of the participants are lower than this age level. Based on the interest level to survey topic, I can say that Hyperloop technology between Los Angeles and San Diego will be generally used by young generation who are single or, married with or without children. This will make this transportation option usable, active and dynamic. As a result, this situation will make it sustainable and popular for future generation.

6.2. Income Level

Income Level

180K - 200K 0

160K - 180K 3

140K - 160K 3

120K - 140K 0

100K - 120K 3

80K - 100K 9

60K - 80K 18

40K - 60K 9

20K - 40K 24

0 - 20K 12

0 5 10 15 20 25 30

Income Level

Figure 21: Income level results of the survey

Based on the results, the median household income level for a year is $50,000.00. The results of willingness to pay of the people in this survey can be recorded for 2018 and they can be sourced for the studies in the following years. According to Federal Reserve Economic Data (FRED), the median household income level is $31,123.00in 1989 and 42,045.00 in 2000 [20]. This shows us that the median household income level is increasing in Los Angeles. We can say that willingness to pay of people may increase for Hyperloop in the following years.

6.3. Education Level

Education Level

18% 26% High School

Bachelors

Masters

56%

Figure 22: Education level results of the survey as percentage

Education level of the respondents can be seen in Figure 22 above. Based on the results, 26% of the respondents’ highest educational level is high school level and the rest 74% of the respondents’ levels are bachelor’s and master’s degree levels. As a result, we can say that most of the respondents answered all questions knowledgeably.

6.4. Travel Frequency from Los Angeles to San Diego

Travel Frequency to San Diego in a Year

0%7% 8% 0 - 2 3 - 5

22% 6 - 8 9 - 11 63% 12+

Figure 23: Travel frequency to San Diego results of the survey

Respondents generally visit San Diego 2-3 times in a year. In Figure 23 above, respondents’ statements on travel time show that 63% of the people visit 0- 2 times in a year and 22% of them visit 3-5 times in a year. The weighted average value is 2.81 and the median value is 2 times. As a result, I can say that San Diego is a city to which people from Los Angeles travel. They prefer to go there more than once in a year, but not often and the purpose of the travel is not business. Depending on the conversation, which I had with the respondents, they prefer to go to San Diego to see different places.

6.5. Rate of Flying

Rate of People Who Fly From Los Angeles to San Diego

Yes No

96%

Figure 24: Flying rate result of the survey

Rate of people who fly from Los Angeles to San Diego is very low, which can be seen in Figure 24. Only 4% of the respondents said that they sometimes use plane as a transportation option when they travel to San Diego. This result shows us that people who live in Los Angeles are willing to travel to San Diego by car, bus or train. Flight option is not a good option since it is more expensive and the total travel time is not favorable with respect to other options.

6.6. Willingness to Pay for Hyperloop

Number of People and Their Willingness to Pay for Hyperloop

3 3 0 6 3 3

0$ -25$ 26$ - 50$ 51$ - 75$ 76$ - 100$ 101$ - 125$ 126$ - 150$ 151$ - 175$ 176$ - 200$

Number of People and Their Willingness to Pay

Figure 25: Willingness to pay results of the survey

In order to understand the acceptability and preferability level of Hyperloop project and its value of saving time, I asked “How much would you be ready to pay in order to save two and a half hour on the travel between LA and San Diego?” to the respondents. The reason to determine two and a half hour for saving time is that the travel time from Union Station, which is located in Downtown LA, to Santa Fe Depot Station, which is located in Downtown San Diego, by train is two hour and fifty minutes. Travel time by Hyperloop will be 12-20 minutes for the same distance.

The result can be seen in Figure 25above.According to the results, the weighted average value is $80.74 and the median value is $60.00 for saving this time in one-way trip. According to white paper, which was presented by Elon Musk to the government, $20 per one person for one-way trip is profitable for the Los

Angeles – San Diego route [21]. The results in my research show that people are willing to pay 3 times more than this amount for this route.

6.7. Willingness to Pay More of People on Changed Route

Number of People and Their Willingness to Pay More for Changed Route Option

15 15 12 12

0$ 0$ - 10$ 10$ - 20$ 20$ - 30$ 30$ - 40$ 40$ - 50$

Number of People and Their Willingness to Pay More for Changed Route Option

Figure 26: Willingness to pay more results of the survey

With this part of the questionnaire, I wanted to know whether choosing the location of the station in Downtown LA could be a better option than the planned location, which is Los Angeles International Airport (LAX) (see Figure 27). I asked, “How much more would you be willing to pay in order to have the possibility to leave from Downtown LA to go straight to Downtown San Diego?” to the respondents, and before asking this question, I explained them the original location of the planned station is LAX.

After I collected the answers, I compared them with the distance analysis (see Table 3 below). The aim was to understand the reliability of data and to see the best solution.

Living addresses of the participants, who answered as $0 or $0-10, are close to Los Angeles International Airport (LAX). Others’ opinions show that they are willing to pay between $20 and $30 in average if LAX station moves to Downtown LA.

Figure 27: Location of LAX and Downtown Los Angeles

Figure 28: City of Los Angeles and Communities (https://mwrealtyla.com)

Table 3: Distance Analysis

Observation(s) Living Address Distance to LAX Distance to Downtown LA 1 Alhambra 27.8 miles 10.2 miles 2 Beverly Hills 12.9 miles 12.5 miles 2 Burbank 28.8 miles 14.4 miles 3 Carson 13 miles 17.2 miles 1 Central Alameda 14.6 miles 3.7 miles 3 Commerce 21.9 miles 6.5 miles 1 Compton 13.5 miles 10.3 miles 3 Culver City 6.7 miles 10.5 miles 2 Downey 18.1 miles 12.1 miles 9 Downtown Los Angeles 17.5 miles 0 mile 2 Eagle Rock 25.3 miles 9.3 miles 5 East Los Angeles 22.5 miles 5.5 miles 1 Echo Park 19.7 miles 3.6 miles 2 Gardena 9.3 miles 13.9 miles 2 Glendale 26.6 miles 10.5 miles 2 Hawthorne 5.0 miles 15.4 miles 1 Hermosa Beach 6.5 miles 21.3 miles 1 Huntington Beach 37.2 miles 36.3 miles 3 Huntington Park 15.1 miles 5.1 miles 2 Inglewood 3.8 miles 12.0 miles 1 La Puente 34.5 miles 20.8 miles 1 Lawndale 6.4 miles 18.8 miles 2 Lynwood 12.9 miles 14.4 miles 2 Manhattan Beach 5.0 miles 20.7 miles 1 Monterey Park 26.5 miles 8.9 miles 3 North Hollywood 24.5 miles 16.1 miles 3 Pasadena 25.7 miles 9.7 miles 1 Pico Rivera 24.6 miles 11.2 miles 3 Redondo Beach 6.9 miles 21.5 miles 1 San Dimas 46.5 miles 30.6 miles 3 Santa Clarita 37.1 miles 34 miles 1 Santa Monica 11.3 miles 15.2 miles 1 Silver Lake 21.2 miles 5.2 miles 2 South Los Angeles 13.2 miles 6.5 miles 2 South Park 13.4 miles 3.4 miles 3 Torrance 11.2 miles 19.4 miles 2 Vernon 16.3 miles 3.2 miles 1 West Los Angeles 9.4 miles 13.4 miles SUM 81 26 55

Chapter 7

Conclusion

Hyperloop is the fifth mode of transportation idea that has been proposed by Elon Musk as an innovative project for future transportation system to carry people and cargo from one city to others directly or circularly. Speed factor makes this technology special since it will go with 760 mph/h (1,200 km/h) speed when it is completed. Currently, the company which runs the first realistic tests, was named as Hyperloop One, and was named as Virgin Hyperloop One after the investment of Richard Branson is trying to achieve this speed. At the same time, company published some routes to apply in the future all around the world. They developed different visions for different countries.

The main concept to develop this project is to lower excess airport capacities. In order to achieve this, they can be connected with Hyperloop technologies. In these kinds of investments which have a possibility to require huge amount of costs, it is needed to analyze whether the concept is good or not, or there exists a better option or not. For this reason, I choose the Los Angeles – San Diego route as a case study to scrutinize.

Participation of people is essential for these kinds of public projects since they are the potential users of the project and they need to be consulted in order to get advantageous situation for both sides, users and service providers. In this and similar studies, contingent valuation method is applied to learn the willingness to pay of people for the project. Questionnaire survey was used on site in Los Angeles for this research.

In the questionnaire, respondents expressed their willingness to pay for ticket from planned station and another station option, which is in Downtown Los Angeles that is added by me. My aim is to see which option is more effective, sustainable, profit generating and usable. According to the results, respondents were willing to pay 3 times more than the amount of price that is defined in the white paper proposed by Elon Musk. On the other hand, respondents who live closer to downtown were willing to pay more than the amount which they declared in question #6. Depending on the data from U.S. Census regarding the population of Los Angeles County and its cities, it shows that the population in communities near Downtown LA is more than the population of communities near LAX. As a result, it will be better to change the starting station from LAX to Downtown LA.

Since this is a limited dissertation, studies on Hyperloop for urban studies can be broader in terms of questionnaire, geography and options. Questionnaire survey’s questions can be increased in detail and applied on the Internet. Face-to- face method is expensive and it is hard to find volunteers to answer the questions patiently. The ways to make them provide an answer for some confidential questions should be found before preparing questionnaire. Moreover, geography in this research was limited with Los Angeles to collect information. Questionnaire and information collection process can be done homogenously. In addition, options for the stations to connect the points can be increased depending on the natural, built and socio-economic environment of the cities which are subject to research by researchers in the future. Finally, studies on Hyperloop technologies will be proposal instead of theory until the first project is fully completed with its all

60 supportive infrastructure and management services. After that, more studies should be done in order to protect and shape our built environment in the best way.

Bibliography

[1] D. Hughes, "https://www.thesun.co.uk," 12 September 2017. [Online]. Available: https://www.thesun.co.uk/tech/2142155/hyperloop-elon-musk-uk-how-fast- transport/. [Accessed 13 February 2018].

[2] R. Gray, «http://www.dailymail.co.uk,» 11 May 2016. [Çevrimiçi]. Available: http://www.dailymail.co.uk/sciencetech/article-3582167/Hyperloop-super-fast-rail- hit-milestone.html. [Accessed: 14 February 2018].

[3] M. Garber, "https://www.theatlantic.com/," 13 July 2012. [Online]. Available: https://www.theatlantic.com/technology/archive/2012/07/the-real-ipod-elon-musks- wild-idea-for-a-jetson-tunnel-from-sf-to-la/259825/. [Accessed 13 February 2018].

[4] «https://hyperloop-one.com/,» [Online]. Available: https://hyperloop-one.com/our- story#hyperloop-white-paper. [Accessed: 14 February 2018].

[5] A. J. Hawkins, «https://www.theverge.com/,» 19 December 2017. [Online]. Available: https://www.theverge.com/2017/12/19/16795386/virgin-hyperloop-test-one-topspeed-airlock. [Accessed: 13 February 2018].

[6] A. Nusca, «http://fortune.com/,» 16 September 2015. [Online]. Available: http://fortune.com/2015/09/16/hyperloop-ceo-rob- lloyd/?xid=soc_socialflow_twitter_FORTUNE. [Accessed: 14 February 2018].

[7] L. Graham, «https://www.cnbc.com,» CNBC, 11 December 2015. [Online]. Available: https://www.cnbc.com/2015/12/09/hyperloop-technologies-choose-nevada-to-test- superfast-transport-system.html. [Accessed: 14 February 2018].

[8] «https://hyperloop-one.com,» Virgin Hyperloop One, [Online]. Available: https://hyperloop-one.com/our-story. [Accessed: 14 February 2018].

[9] A. Ellingson, «https://www.bizjournals.com,» 6 April 2017. [Online]. Available: https://www.bizjournals.com/losangeles/news/2017/04/06/hyperloop-could-be- coming-to-one-of-these-11-u-s.html. [Accessed: 14 February 2018].

[10] «https://www.census.gov/,» United States Census Bureau, [Online]. Available: https://factfinder.census.gov/faces/tableservices/jsf/pages/productview.xhtml?src=CF. [Accessed: 20 February 2018].

[11] L. M. Pitt, «https://www.britannica.com,» Britannica, 8 February 2018. [Online]. Available: https://www.britannica.com/place/Los-Angeles-California. [Accessed: 20 February 2018].

[12] «https://www.discoverlosangeles.com,» Discover Los Angeles, 15 December 2017. [Online]. Available: https://www.discoverlosangeles.com/press-releases/facts-about- los-angeles. [Accessed: 20 February 2018].

[13] R. Brown, I. Castaneda, C. Encinas, S. Flores, C. Gillespie, R. Kuehn, R. Mann, L. Mclin, R. Monaco, A. Musnicki, R. Reed, R. Reschke, B. Robinson, S. Saythong, M. Schafer ve D. Valle, «Exploratory Airport Study 2.1,» California State University San Marcos, San Marcos, CA, 2015.

[14] J. Elledge, «CityMetric,» 2 September 2014. [Online]. Available: https://www.citymetric.com/what-hub-airport-and-why-should-you-want-one-100. [Accessed: 20 February 2018].

[15] F. Alpizar, F. Carlsson ve P. Martinsson, «Using Choice Experiments for Non-Market,» Göteborg University, Göteborg , 2001.

[16] T. Boyer ve S. Polasky, «Valuing Urban Wetlands: A Review of Non-Market Valuation Studies,» Wetlands, cilt 24, no. 4, pp. 744-755, 2004.

[17] I. Bateman ve K. Willis, Valuing Environmental Preferences, Oxford: Oxford University Press, 1999.

[18] P. Diamond ve J. Hausman, «Contingent valuation: Is some number better than no number?,» Journal of Economic Perspectives, no. 8, pp. 45-64, 1994.

[19] M. Hanemann, «Valuing the Environment through Contingent Valuation,» Journal of Economic, no. 8, pp. 19-43, 1994.

[20] U.S. Bureau of the Census, «FRED,» Federal Reserve Economic Data, [Online]. Available: https://fred.stlouisfed.org/series/MHICA06037A052NCEN. [Accessed: 19 May 2018].

[21] B. Roberson, «Digital Trends,» 12 August 2013. [Online]. Available: https://www.digitaltrends.com/cars/musk-details-hyperloop-high-speed-transport- plans-says-someone-else-should-build-it/. [Accessed: 20 May 2018].