Musk's proposal won't actually get riders to the downtowns of Los Angeles or San Francisco. It can only carry around 10% of the capacity of the California High-Speed Rail. Additionally, it will bypass other population centers, like Bakersfield, Fresno, and San Jose.
Building a truly workable Hyperloop, if it's feasible at all, will be significantly more expensive than Musk claims. It might even be more expensive than the California HSR project. And Musk's proposal leaves a lot of questions unanswered.
How did he come to his construction cost estimate in the first place? Musk argues that the Hyperloop is cheaper than HSR because it's elevated, saving on the cost of building at grade and reducing local opposition. But bridges are far more expensive than building tracks at grade. And just because the footprint is limited to a big pylon every 100 feet doesn't mean that the environmental impact analysis process will be any easier or that the public will be any more receptive.
Other issues, like seismic stability, are simply glossed over. He claims that by elevating the Hyperloop tracks, they will be more stable than ground-running HSR. Clearly he's unfamiliar with the Cypress Street Viaduct. That's one reason that the California High-Speed Rail Authority insists on crossing all faults at grade.
Musk also claims that his giant steel tube will be okay with the only expansion joints at the Los Angeles and San Francisco ends. They'll just be really big. That's a significant engineering issue that cannot simply be ignored, at least not if Musk is in any way serious about this proposal.
He's not. If he was, he would have immediately thought of the most obvious cost overrun source: the cost of the land to build the tube pylons on.
Consider some of the major factors for why California’s $68 billion high-speed rail system has gone over budget. In many cases, local communities have demanded extra viaducts and tunnels added to the project that weren’t strictly necessary. Other towns, meanwhile, have insisted they not be bypassed even in cases where it would be cheaper to do so. Would the Hyperloop be immune from these sorts of political pressures and tweaks?
What’s more, California’s high-speed rail project has had to grapple with the high costs of acquiring more than 1,100 parcels of land, often from farmers resistant to sell. The Hyperloop would try to minimize this problem by propping the whole system up on pylons, shrinking its footprint, but it can’t escape the land problem entirely. As Alexis Madrigal points out, Musk’s proposal seems to assume it’s possible to buy up tens of thousands of acres in California for a mere $1 billion. That’s awfully optimistic.
I hear Hyperloop, I think "Springfield monorail".