Deutsche Welle said Sunday that University of Paderborn researchers have already created a small prototype of the new transportation system and are now ready for additional tests under normal conditions.
To date, more than $15.5 million has been invested in RailCab research and those involved have warned an additional $28 million be needed to create a prototype of the appropriate size.
There would be additional costs to adapt the nation's rail tracks so the RailCabs could operate on them.
The system's cars use magnetic fields to move across the rails and can operate in convoys or alone.
The German broadcaster said if the system does get the necessary funding and works according to plan, its ability to transport passengers and their cargo in smaller, driverless cars could make German travel more effective.