Elon Musk’s Boring Company in Talks Over Amtrak Tunnels: What It Means and How to Think About Investing

Elon Musk’s Boring Company in Talks Over Amtrak Tunnels: What It Means and How to Think About Investing

On May 12, 2025, The New York Times broke news that the Federal Railroad Administration has brought Elon Musk’s Boring Company into preliminary discussions about using its tunneling technology to bolster Amtrak’s passenger rail network. While details are still sketchy, the very idea of Musk’s team working on America’s aging rail corridors raises intriguing questions—both for the future of U.S. transportation and for investors seeking to capitalize on infrastructure innovation.

1. Why the Boring Company and Amtrak?

Amtrak’s long-term challenge is twofold: capacity constraints in dense corridors (think Northeast “Acela” routes and California’s San Joaquin Valley) and a patchwork of aging infrastructure built for lower speeds and smaller volumes. Traditional rail expansion—new tracks, elevated viaducts, upgraded signaling—can take a decade or more and cost tens of billions of dollars.

  • Tunneling as a Shortcut: Musk’s approach is to dig relatively narrow-diameter tunnels that carry high-frequency electric shuttles or conventional trains. By going underground, you sidestep land acquisition battles and surface congestion.
  • Test Case Experience: The Boring Company has delivered a one-mile demonstration tunnel in Las Vegas and is working on extensions around the Convention Center. These projects have shown faster boring rates (albeit on a small scale) and modular tunnel segments that could, in theory, be adapted for rail vehicles.
  • Federal Interest: The FRA’s invitation suggests Washington is exploring all options to meet ambitious passenger-rail funding targets outlined in recent infrastructure bills. Musk’s brand of “hyperlocal” tunneling could appeal as a complement—not a replacement—to surface upgrades.

2. Technical and Regulatory Hurdles

No one is underestimating the challenges:

  • Tunnel Diameter & Rolling Stock: Boring Company tunnels to date are designed for individual Tesla vehicles on electric sleds, not 80-foot passenger cars. Scaling up will require redesigning shield diameters (likely 18–24 feet), track systems, and emergency egress.
  • Speed vs. Cost Tradeoffs: High-speed rail demands gentle curves and long sightlines—features that eat into the Boring Company’s claimed cost savings. Curvature limitations in urban cores may cap speeds at 50–70 mph, rather than the 125 mph+ that Amtrak seeks.
  • Permitting & Safety: Federal tunnel standards, seismic assessments, ventilation, and fire-safety systems add layers of complexity (and cost) absent from Musk’s simpler test tunnels.

3. Broader Impacts on the Rail Industry

If small-diameter rail tunnels prove viable, the implications extend far beyond Amtrak:

  • Urban Commuter Relief: Cities like New York, Boston, and Chicago could build bypass loops to relieve overcrowded stations without razing neighborhoods.
  • Freight Diversion: By moving high-value or time-sensitive freight underground, surface routes could focus on heavy bulk cargo, improving overall network efficiency.
  • Public–Private Partnerships: The FRA’s overture signals a willingness to partner with private innovators, potentially unlocking new financing models (availability payments, shadow tolls) and sharing risk.

4. Investment Themes and Strategies

How might investors participate in this potential rail-tech renaissance?

  1. Tunnel Boring Equipment & Services:
    • Caterpillar (NYSE: CAT) and Herrenknecht (ETR: HRK) manufacture large tunnel-boring machines; any scale-up for rail will rely on their engineering.
    • ITD Cementation and Skanska (STO: SKA B) provide tunnel construction services globally.
  2. Rail Systems & Signaling:
    • Siemens Mobility (FRA: SIE), Alstom (EPA: ALO), and Thales (EPA: HO) supply trains, communications, and train-control systems that could adapt to tunneled routes.
  3. Urban Infrastructure Funds:
    • Specialized infrastructure ETFs (e.g., iShares U.S. Infrastructure ETF: IFRA) may gain exposure as tunnel projects ramp up.
  4. Private Equity & Concessions:
    • Funds focusing on transportation concessions (Macquarie’s Green Investment Group, KKR’s infrastructure arm) could partner on build-own-operate models.

5. What to Watch Next

  • FRA Request for Proposals: A formal RFP would signal moving from talks to planning; look for details on tunnel specs, funding splits, and timelines.
  • Environmental Impact Statements: Publication of draft EIS documents will reveal technical assumptions, cost estimates, and community concerns.
  • Private Financing Deals: Early concession agreements or project bonds indicate private-sector confidence in the model.
  • Technological Pilots: A small-scale proof of concept on an Amtrak branch line (e.g., NEC segment between Philadelphia and Wilmington) would build investor confidence.

Conclusion

The Boring Company’s entry into Amtrak discussions may feel like a Musk-style publicity stunt—and partly it is—but it also reflects a broader search for faster, less disruptive ways to upgrade America’s rail network. For investors, the key is to distinguish headline-driven hype from tangible technology rollouts. Positioning around core tunneling equipment manufacturers, rail-systems suppliers, and infrastructure funds offers the most direct path to capture growth—while watching closely for official contracts and pilot projects that turn Musk’s tunnel dreams into passenger-carrying reality.