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The Boring Co.’s projects are making transit departments rethink above-ground travel
The Boring Company’s underground tunneling projects are widely-appealing to Transit Departments and Authorities across the United States. Because of the sustainable tone of Elon Musk’s Boring Company, along with the efficiency of an Express-based system, agencies responsible for solving the issue of public passenger transportation are considering underground options more often than ever before. Above-ground public travel options, like Monorails or buses, are being ditched for underground options, and subways are outdated and not widely considered by these agencies.
Elon Musk’s underground tunneling venture has made it from California to Las Vegas, and now, back to California again, as the San Bernardino County Transportation Authority (SBCTA) is considering a new underground tunneling project from the Boring Company. Later today, on February 3rd, the entity will consider the Boring Company’s submission for an underground tunnel that would take travelers from several different locations to the Ontario International Airport, located in Southern California. While the Boring Company has already received the equivalent of preliminary approval from the Transportation Authority, more questions are being asked to secure the tunnel’s place in the densely-populated and traffic-heavy area of Southern California.
In September 2020, the SBCTA Board of Directors approved the release of a Request for Qualifications, seeking qualified entities to submit a Statement of Qualifications for a potential tunneling project in San Bernardino County. According to documents released by the SBCTA, the tunnel will run from the Rancho Cucamonga Metrolink Station to the Ontario International Airport, procuring a design-build and transitional operate-maintain methodology that will have the two transit systems running concurrently to complement one another.
The 31-minute ride from the Rancho Cucamonga Metrolink Station to the Ontario International Airport could be expedited thanks to a new Boring Company tunnel proposal. (Google Maps)
The only thing is, not many companies with expertise in tunneling stepped forward. And by not many, only one did: The Boring Company.
The SBCTA wrote:
“In response to the RFQ, one Statement of Qualifications (SOQ), from The Boring Company, was received on November 30, 2020. A review panel was assembled involving a technical review team and an executive oversight team consisting of representatives from the City of Rancho Cucamonga, the City of Ontario, the OIAA, Omnitrans, and SBCTA. The SOQ was deemed responsive and passed all the minimum requirements of the RFQ.”
After an initial assessment from SBCTA Board Members, the Boring Company met the minimum requirements to qualify for further scrutiny. The Boring Company’s Statement of Qualifications only received a score of 58/100. Still, more information regarding financing, timing, ridership, and how the system will operate in conjunction with the Rancho Cucamonga Metrolink Station will likely increase that score. These issues are set to be brought up during the Board of Directors meeting later today.
Ditching Above-Ground Systems for Underground Tunnels
Above-ground systems of transportation have been around for ages. Monorails, trains, and other large-scale passenger transportation systems have been aligned with cost-effective and efficient travel for decades, but a new era has come in thanks to Elon Musk. While many argue that the Boring Company’s system is a simple revision of a subway, it is far from identical. The Boring Company loops use Tesla’s all-electric vehicles for passenger transport, eliminating jam-packed, unsanitary, and oftentimes, uncomfortable situations where underground travel is offered.
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Sitting in an automotive seat, likely joined by colleagues, or in some cases, complete strangers, is much more comfortable in a smaller setting, especially as the COVID-19 pandemic rolls on. Additionally, the express-system eliminates the need for unneeded stops, decreasing total travel time.
While the San Bernardino project seems to indicate that the Boring Company will work with an already-operational monorail system, other projects have completely abandoned the idea of using an above-ground Monorail system. One of the most notable is the Boring Company’s Vegas Loop. After the Las Vegas Convention and Visitors Authority (LVCVA) purchased the bankrupt Vegas Monorail system in 2020, it opened the door for the Boring Company to expand its possible tunneling to property exclusive to the Monorail.
The Boring Company has several other large-scale projects in the proposal stage, including one in Fort Lauderdale, Florida, and Chicago, Illinois. These projects are in the early stages and will be subjected to the speed at which local authorities move. Some agencies are quicker to get the ball rolling on public transit projects than others. For example, a tunnel between Baltimore and Washington D.C. would eliminate the need to travel on the Maryland Transit Authority’s Lightrail system, a cost-effective, but not time-effective, way to travel from suburbs of Baltimore County to the Nation’s Capitol. This project has been in a stalemate for several years but would expedite the travel time from Baltimore’s Camden Yards, home of the Orioles, to Washington. The Boring Company’s website indicates that an environmental review is pending.
Underground tunnels may be the way of the future, much like electric cars. At the forefront, a South African-born entrepreneur named Elon Musk is leading the charge, changing how human beings will travel from one point to another.
The San Bernardino County Transportation Authority’s Agenda is available below, with The Boring Company’s consideration beginning on page 13.
Tbc San Bernardino Tunnel by Joey Klender on Scribd
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In a new note to investors on Tuesday, Morgan Stanley analyst Andrew Percoco said that Tesla has one big financial question to answer for investors regarding its Robotaxi rollout, Full Self-Driving software, and Optimus.
Percoco said in the note that, for the most part, investors are still very positive about the direction the company is headed. However, there are some things the firm would like to see, and they have to do with financials.
Tesla (TSLA) Q2 2026 earnings results: miss on EPS, beat on revenue
Tesla bulls are more than convinced that the company’s Full Self-Driving software is proof it can develop physical AI. Financially, however, there are still some questions, especially on elevated spending, which CEO Elon Musk said would occur as the company works to roll out Robotaxi faster and continue developing its Optimus robot.
The latter two are where Tesla will have to prove progress to investors, as Percoco writes that both projects “will require clearer evidence that Robotaxi is scaling and more tangible Optimus proof points to support the ROI on elevated capex.”
Percoco said the second quarter earnings call did not change his long-term thesis of where Tesla is positioned in the AI race, which is out in front. However, there are concerns that weaker gross margins and higher R&D spend will stress financials, and that has “sharpened our (and investors’) focus on measurable progress across Robotaxi and Optimus.”
Additionally, Robotaxi still needs to be proven with more operation in existing cities while maintaining safety but improving how many rides it gives in any given time, he said. For Optimus, Percoco wrote that he is “still looking for evidence beyond commentary around SOP.”
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Morgan Stanley put Percoco in charge of covering Tesla after long-time analyst Adam Jonas transitioned to the automotive side.
Currently, Morgan Stanley has a $415 price target on Tesla and a ‘Hold’ rating on the stock. It is trading at around $330 at the time of publication, which was 2:30 P.M. on the East Coast.
SpaceX’s massive investment in AI will make it a big winner, Argus Research said after the company’s successful earnings call last week.
The firm also upgraded shares to a Buy from Hold and set a $160 price target.
SpaceX (NASDAQ: SPCX) is currently recovering from its heavy AI infrastructure investments, as it spent nearly $16 billion in Q2 alone. The company did this primarily by monetizing high-demand GPU compute capacity at a much faster pace than traditional data center economics would suggest.
Company CFO Bret Johnsen said that SpaceX would be able to pay back anything on new deployments within a year.
There are plenty of ways the company can do this:
Leasing excess compute capacity through contracts
SpaceX has already built Colossus and Colossus II, largely for its own model training. However, much of that capacity is already rented out to third parties. It already has major deals with Anthropic, Google, and Reflection AI. These partnerships are adding billions per month to SpaceX’s spreadsheet.
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High utilization driven by industry-wide scarcity
The demand for advanced AI training and inference capacity continues to exceed what is available for use. SpaceX can fill new racks quickly after they come online, so the capital deployed converts into revenue with minimal idle time.
Additionally, management and outside observers have described the new compute capital as behaving more like a cost-of-goods-sold than traditional multi-year capex, especially because of this rapid monetization pattern.
Capacity has already scaled from ~0.4 GW a year to 1.4 GW annually by the end of Q2. There are targets of more than 2 GW by year-end.
High incremental margins on the rental business once capacity is online
GPU cloud providers often operate at strong gross margins. SpaceX can monetize capacity that was already partially built or can be added efficiently. This means that incremental EBITDA margins on the rental revenue are usually high. This accelerates cash recovery relative to the gross capital outlay.
Parallel monetization of its own AI software and applications
Beyond pure infrastructure rental, SpaceX also generates revenue from Grok through subscriptions and usage, from X through ads, data, and other related services, enterprise APIs, and the planned integration of the Cursor coding tools acquisition.
These application layers ride on the same compute infrastructure and provide additional high-margin streams that could offset build-out costs. AI-segment revenue overall rose sharply to about $2.6 billion in Q2, according to Motley Fool. This was driven primarily by the infrastructure contracts, but the software side is also partially responsible.
Efficient, large-scale deployment and vertical integration advantages
SpaceX has emphasized the rapid construction of power and cooling infrastructure and favorable cost-per-megawatt economics relative to industry benchmarks in some disclosures.
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Combined with its ability to scale capacity aggressively and the fact that many contracts start generating revenue within months of capacity coming online, the effective payback compresses dramatically compared with more conventional multi-year data-center projects.
SpaceX’s dominant near-term recovery path will turn the AI clusters into a hyperscale-style compute rental business for other leading AI companies while still using a portion for internal models.
Tesla headlights have caused a recall of over 20,000 of the company’s two most popular vehicles, the Model 3 and Model Y, due to the low-beam bulb exceeding the maximum allowed intensity according to federal standards.
Tesla initiated the recall with the National Highway Traffic Safety Administration (NHTSA) this morning, stating that the low-beam output “exceeds the maximum allowed intensity in the outer upper-right and outer upper-left areas of the 10U and 90U zone, as prescribed in FMVSS No. 108.”
Tesla sourced the impacted headlights from Marelli Automotive Lighting, a Mexico-based company. The recall impacts 2020-2023 Model Y vehicles and 2017-2023 Model 3 vehicles. It is estimated that every VIN in this recall is impacted by the defect.
🚨 Tesla is recalling 20,349 2020-23 Model Y vehicles and 2017-23 Model 3 vehicles due to an excessively bright headlamp low beam.
Currently, there is no remedy plan in place, as it is still being developed. pic.twitter.com/y34cIO2U0B
— TESLARATI (@Teslarati) August 11, 2026
Typically, Tesla would remedy recalls of this nature through an Over-the-Air software update, which has been a major focus of criticism by the company and its supporters because the NHTSA still refers to it as a “recall,” even though it requires no action by the vehicle owner. The fix is shipped over the internet and downloaded to the car.
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However, there appears to be a potentially different solution for this problem. Tesla has not developed a remedy for this issue, so it could potentially be on the way. The big issue appears to be the fact that these recalled lamps are out of production, and this is an old body style for both vehicles. The headlights and front-end designs are completely different.
Tesla switched to another supplier when the affected headlight design was discontinued. It plans to begin notifying owners of their remedy options by September 15.
Tesla filed a petition protesting the recall to fix the vehicles’ headlight issue, but the NHTSA denied it. Now, Tesla will come up with a solution to fix it.
Tesla has one big financial question to answer for investors: Morgan Stanley
SpaceX AI investment gamble will make it a big winner, firm says
