Former SpaceX engineers develop autonomous electric rail vehicles and complete Series A financing

Parallel Systems, a company founded by three former SpaceX engineers to build autonomous battery-electric rail vehicles, stepped out of stealth mode on Wednesday to raise $49.55 million in Series A funding. The company has raised $53.15 million to date, including a $3.6 million seed round, and the Parallel System is working to create a more efficient, decarbonized freight network on top of its existing rail infrastructure.

According to co-founder and CEO Matt Soule, the funds will be used to build second-generation vehicles and launch an advanced testing program to help the startup figure out how to integrate its vehicles into real-world operations. The startup's rail rolling stock architecture aims to address several issues: carbon emissions in freight, supply chain constraints for trucking, and rail freight constraints.

In the United States, the rail network accounts for 28 percent of all freight, but most of it is large trains for bulk transportation activities, transporting primary resources such as coal and timber. A small portion of rail freight activity is called intermodal activity, which basically involves moving steel containers between a range of different modes of transport, such as ships and trucks.

Parallel's patent-pending vehicle structure includes a stand-alone power railcar that can be loaded and transported as a single or double-decker load in standard shipping containers. They can join forces to form "platoons" or travel separately to multiple destinations en route, which means they don't need to load large amounts of cargo to make the service economical, and they can actually carry more weight than trucks, which handle most cargo transportation in the United States.

The unit economics of the Parallel Systems system do not depend on very large trains, which can be transported in smaller rows and do not need to stay all day in unloading and loading operations, and can be in and out within an hour or two, leaving room for the arrival of other platoons. It's a more efficient footprint, and it makes it possible to serve things like ports and create inland port shuttle systems so you can move containers from the seaport to the inland port, which is often a better place for trucks and closer to warehousing activities.

Parallel Systems sees the railway's closed network as an ideal operational design area for the safety of autonomous driving technology and early commercialization, given limited access to tracks and centralized traffic control. It's important to note, however, that while Parallel's long-term vision seems promising, the company has yet to test it on a national network, and it has been testing its prototype on a small railroad in Los Angeles that is insulated from the national network.

U.S. railroads are privately owned by owner-operators, which makes it difficult for Parallel to test its vehicles and the autonomous systems of its running vehicles on a large scale. Parallel's goal is to have private railroad companies as its customers, looking to sell or lease their tools, allowing them to operate services on a day-to-day basis while providing support in providing and integrating technology.