TKAMY Thyssenkrupp AG (PK)

By Christopher Alessi 

Imagine an elevator that moves without attached cables, and can travel horizontally or vertically, sharing a shaft with several other cabs.

That is the vision of German industrial conglomerate Thyssenkrupp AG, which aims to use magnetic-levitation technology to revolutionize a business that has essentially delivered the same product for over a century.

Thyssenkrupp hopes by adapting maglev technology used in high-speed trains, it could elbow aside rivals including United Technologies Corp.'s Otis unit, the world's largest and oldest elevator maker.

Otis and Thyssenkrupp's two other global competitors, Finland's Kone Corp. and Switzerland's Schindler Group, are taking incremental approaches to innovation for their people-movers.

Kone offers carbon-fiber elevator cables that have higher tensile strength than traditional metal, permitting taller shafts. Otis and Schindler have focused on improving the computers that manage how banks of elevators operate, seeking to cut passengers' waiting times and improve efficiency. Thyssenkrupp offers similar systems.

Only the storied German steel and engineering company is proposing to eliminate the elevator cable altogether, fashioning a kind of hyperloop for commercial buildings. Thyssenkrupp already runs a scaled-down mock-up and later this year aim to demonstrate a full-size working prototype. If all goes well, sales could begin as soon as next year.

"It will definitely take some years to filter through, but it's a start, " said Andreas Schierenbeck, chief executive of Thyssenkrupp's elevator division. He predicted the technology, dubbed Multi, would ultimately make elevators faster and more efficient while transforming the way buildings are constructed.

Rivals are skeptical.

"So far, these kinds of concepts have not been commercially viable," said Kone Chief Executive Henrik Ehrnrooth.

Silvio Napoli, Schindler's former chief executive and now a director, said horizontal elevator concepts are "not that new for the industry."

"Competitors were working on this years ago but found problems," including high energy consumption, he said.

Otis in the 1990s designed a system to run both vertically and sideways, but its intricate system of pulleys and cables proved too complex to install, according to Dario Trabucco, a researcher at the Council on Tall Buildings and Urban Habitat, a nonprofit standards organization.

Otis declined to comment for this article.

James Fortune, an expert at Fortune Shepler Saling Inc., an elevator consultancy that works with developers and architects, said Thyssenkrupp's biggest challenges will be "to develop a working system that would be cost-competitive" and to convince developers they should take the risk of using its unique and proprietary system.

Today's high-speed single elevators typically cost between $400,000 and $600,000 a shaft, he said. A Thyssenkrupp spokesman said pricing estimates for Multi aren't yet available but "the savings in reduced footprint for super-tall and mega-tall buildings is enormous and pays off easily."

Replacing an installed elevator system could cost millions of dollars, and in some structures could be impossible. So developers shun risk.

"This will be a very niche market," said Andre Kukhnin, an equity analyst at Credit Suisse, noting that buildings would need to be designed entirely around Thyssenkrupp's system. Mr. Kukhnin said an evolutionary technology like Kone's carbon-fiber rope may have a bigger impact on the industry.

Kone's Mr. Ehrnrooth said its synthetic belts, which are already in use, are much lighter than traditional steel cables, so its system consumes less energy and costs less to maintain. Kone says its "UltraRope" will allow elevators to double today's maximum shaft height of about 500 meters.

Longer shafts reduce the need for elevator transfer lobbies on high floors, boosting rentable space, experts say.

Still, Thyssenkrupp's Multi is the first big break from cables in 160 years. Rather than operating like a yo-yo, it hovers each cab vertically or horizontally with magnetic fields.

Floating up a tower might make some elevator riders skittish but the average passenger is "absolutely ignorant" about how elevators work, said Mr. Trabucco at the Council on Tall Buildings. Enticing riders shouldn't be hard if the system is fast, he said.

Thyssenkrupp said it is still developing safety features in coordination with consultants and building developers. It said all Multi elevators will employ a "multistep braking system" to handle "all possible scenarios of operation."

Thyssenkrupp started actively developing the technology in the 1970s with German engineering group Siemens AG for a high-speed train project that was canceled in Germany, though one of their Transrapid trains runs in Shanghai.

"But the technology is there...the patents are there," said Thyssenkrupp's Mr. Schierenbeck. Rivals, he noted, "don't have access to that technology."

Albert So, an elevator expert at the Asian Institute for Built Environment, predicted magnetic-levitation elevators would eventually spread because it is the only available technology that could allow more than two cars in a shaft. Such sharing would significantly boost efficiency.

Thyssenkrupp since 2003 has offered a more traditional cable system that runs two independent cabins in one shaft. The system ensures the cars stay safely separated. It operates in several tall buildings, including the new European Central Bank headquarters in Frankfurt.

Write to Christopher Alessi at christopher.alessi@wsj.com

(END) Dow Jones Newswires

July 18, 2016 17:17 ET (21:17 GMT)

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