Ex-SpaceX engineers design electric train cars

Three former SpaceX engineers have launched a company to design and build self-powered electric railcars, in an effort to improve efficiency and reduce emissions in the freight rail system.

Freight trains are more energy efficient than trucking. Thanks in part to the improved aerodynamics, moving a single freight unit by train requires a quarter of the energy needed to move it by truck, CEO and founder Matt Sully told CNBC.

“But because of the way railroads are engineered, it has its operational and economic limitations,” Sully said. “But if you can break through those barriers and allow rail to serve more of these markets – that’s the opportunity.”

Moving the charging system from diesel to electric power can play a major role in reducing the carbon emissions that cause global climate change. Transportation accounts for 29% of total US greenhouse gas emissions, according to a December 2021 report by the Environmental Protection Agency. Roughly a quarter of that comes from medium and heavy-duty trucks.

“We think it’s very important to focus on reducing energy use,” Sully told CNBC.

Soule’s idea came in an unusual way.

At SpaceX, where he started in 2006, Soule was head of the avionics division, which means “we made the electronics that make the rocket fly straight.” After leaving in 2019, Soule has been waiting to meet friend, technologist and product designer Brian Ignaut for coffee and watch YouTube on his phone. The selection algorithm presented him with a random video clip on freight trains. This made him think about the potential in the freight train system and the need to reduce carbon emissions.

By Thanksgiving 2019, the idea for the company was gathering up, and in January 2020, Soule started firing two other SpaceX employees, John Howard and Ben Stabler, for the company. The trio were mostly silent about what they were doing until Wednesday, when they revealed the company to the press and announced a $50 million funding round led by Anthos Capital.

The company is only in the prototype stage and has no customers or revenue yet. With the new round of funding, Parallel Systems, which has been operating with seed funding of $3.6 million, will build a fleet of rail vehicles and implement advanced testing and team development programs.

So far, with its staff of 25 engineers from technology companies like Google, Tesla and Uber, Parallel Systems has built several prototypes and tested its first-generation car on a closed track in the Los Angeles area.

Vehicles operate in pairs. Each pair carries one standard shipping container – the same box that is transported in flatbed trucks and loaded on and off ships in port cities around the world.

All the cars that carry the containers are self-powered, but the system will work better if the cars are tied together. So, instead of having a long freight train powered by a few diesel locomotives, Parallel Systems envisions a “platoon” of 10 to 50 self-powered freight cars, Sully told CNBC.

This is much shorter than conventional freight trains, which can operate up to 200 cars or more. Today, freight trains prefer length because the more one train can carry, the cheaper it becomes to move each unit full of stuff. But Sully told CNBC that parking and unloading cars is a big chore.

A very long train requires a very large train station to unload and load goods. This can present a problem because the ports and places where freight is loaded are often in urban areas, such as Los Angeles, where land and space are at a premium.

Independent train detachments can improve train station logistics and reduce those costs.

“Because the vehicles are in autonomous mode under crane and autonomous, the station stay time and ground capacity required are much smaller,” explained Dean Wise, former vice president of network strategy at BNSF Rail who advises the company.

Manufacturing electric cars doesn’t necessarily make the system completely eco-friendly — it depends on how you create the electricity that powers that part of the grid, Sol readily admits.

But electric railcars have at least the potential to emit zero greenhouse gases, while diesel trains will almost always emit some.

Furthermore, since electric rail cars use 25% as much energy as long-range trucks, their batteries only need 25% of the storage capacity required for a long-range electric truck. Sully said the company has not yet decided what type of batteries to use, but is looking at storage technologies from the utility space.

For Soule, moving on from his previous position at SpaceX means getting used to overseeing the entire company and moving forward and getting used to being a seller.

But he said it was heartening to see industry veterans interacting with the prototypes.

“No matter how many PowerPoint presentations we give them, once you see them in person, you can see the lightbulb in action,” Sully said.

Wise says previous SpaceX engineers have stuck to an idea that others in the industry have envisioned.

“At BNSF, we have brought forward ideas that a self-powered, self-driving rail vehicle will be a game-changer, dramatically improving railroads’ ability to compete with the highway, and defending against the looming challenge of self-driving trucks — now recognized by the Most people regard it as a question of when and not if.”

So far, Parallel Systems has made calls with 30 “major companies” in the space, including Class A railroads, short-haul railroad holding companies, auto carriers, ocean carriers, ports and industrial shippers, Wise said.

“The tipping point for me was that these conversations were globally positive and revealed additional value, improvements, and potential applications, leading many companies to pursue strategic development partnerships and investment opportunities with parallel,” Wise said.