The transit industry is facing declining ridership and increasing costs with with no apparent end in sight. This paper takes the view that totally new solutions are needed. The approach is to examine the equation for total cost of a transit system per passenger-mile to determine how to configure a new system to minimize this quantity. Term-by-term analysis leads to derivation of a consistent set of optimum characteristics. Guideway costs are minimized by distributing the load in very small capsules. The fleet cost is minimized by increasing the average speed without increasing the cruising speed by use of off-line stations, which in turn minimize energy use by permitting nonstop trips. Maintenance costs are minimized by designing a very light-weight, automated vehicle with very few moving parts. While this general configuration has been known for several decades, it has not been generally recognized that it can be derived by minimization of system costs, and that cost minimization is obtained simultaneously with service maximization. While a great deal of controversy surrounded this concept a decade ago, advances in technology make it fully practical now.
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