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By Emily Balan, Special to

It's a bird. ... It's a plane. ... It's a pod of steel! The future of transportation could be closer than you think as Hyperloop One tested its electric engine in its first open-air demonstration on Wednesday.

Before its first test run, Rob Lloyd, CEO of the tech start-up, said that the company — formerly known as Hyperloop Transportation Technologies — is "rewriting the rules" in transportation technology.

"The world is watching. It's cynical, but it's cheering for us at the same time," Lloyd told CNBC's "Squawk Alley." "Our objective is to find the routes in the world where governments, citizens, regulators can come together really quickly."

Read More from CNBC: In Transportation Wars, Hyperloop Takes on Hyperloop

The test was a demonstration of the production-scale electric motor that the company developed, Lloyd said. A test sled powered by the motor, which will go inside the end-product tubes, ran about 2.5Gs fast for only a couple of seconds on about a third of a mile-long straight track in the desert a little north of Las Vegas.

This will be the same site for the first full-scale version of the transportation technology. A full demonstration of the system is slated to run by the end of 2016, according to Lloyd.

The growth of this transportation innovation has been accelerating since Tesla's CEO Elon Musk, who has no affiliation with the companies actually producing this technology, proposed the idea for the project about three years ago. The Nevada testing site has been developing for less than six months, CNBC reported on "Fast Money Halftime Report."

Read More: Elon Musk's Idea Will Transform Labor Markets, CEO Says

The company will start to produce the cargo tubes in a couple of weeks, Lloyd said. These steel pods, 11 feet in diameter, will be magnetically suspended on a track and able to reach up to 760 miles per hour.