Brightline is facing challenges in its high-speed rail project due to rising construction costs.
The rail line, named Brightline West, is being built between Southern California and Las Vegas as part of an initiative to make travelling to the city more accessible to visitors.
Trains will be able to travel around 350km/h along the purpose-built track and would reduce travel time by around two hours from Rancho Cucamonga, California.
Once completed, the trainline could provide valuable public transport infrastructure across the states.
According to recent estimates, around 50 million people travel between Los Angeles and Las Vegas annually, with over 80% using a car.
This trip takes around four hours in a car, while coaches can take up to eight hours.
In 2021, the Surface Transportation Investment Act was passed, which handed the responsibility from Amtrak to the Department of Transportation, and within two years Brightline had raised enough funding to take on the project.
However, Brightline is having to raise additional equity, issue new bonds and finance $2.5bn in debt to finish the project.
The rail project was initially projected to cost around $16bn, but Mike Reininger CEO explained during a recent investor call that the strong demand from data centers and power plants is putting a strain on labor and material costs.
Out of the nine construction contracts needed for the project, four have been finalised, and Brightline West has begun work on the Las Vegas Station.
The remaining contracts, as well as a $6bn loan, are still being negotiated with a consortium of banks.
The Brightline West line would connect to the existing high-speed rail line at Rancho Cucamonga.
The rest of the line has connections going to Los Angeles, Sacramento, San Francisco and San Diego.
Mike Reininger, Brightline West CEO, said: "It will probably not be a surprise to anyone, that we are experiencing a construction market right now that is seeing increasing costs. We are definitely not alone in this situation. The new plan that we are working on includes materially more equity."
Amtrak discontinued the Desert Wind train between Los Angeles and Las Vegas in 1997, then spent several years announcing it would reinstate the line, only to keep cancelling the plans
