It will be a Ground Effect lifting body on an electromagnetic rail. The lift is provided by aerodynamic effects, and thrust is provided by electromagnetic force.
Based on the details of the design, it would be capable of supersonic speeds like the Concord, while employing Ground Effect like an air hockey table, and propelled like a Rail Gun.
The biggest challenges will be keeping the vehicle stable and at a constant distance from the power rail at high speeds, as aerodynamic disturbances can destabilize the vehicle. Given Elon's expertise with rockets, this should not be too difficult.
EDIT:
An prototype of a ground effect train:
http://www.youtube.com/watch?v=EaOnrIRf_Mg
Elon's will use electromagnetic propulsion instead of electric fans.
EDIT 2: I just realized this may be Elon's electric jet idea. He may use a ram-air electric jet at high speeds, and only use the power rail to get the vehicle to supersonic speeds where the ram-air engines are most efficient. This would make it MUCH cheaper than maglev by eliminating the power rail on the majority of the track.
EDIT 3: Rail gun diagram.
http://www.howstuffworks.com/rail-gun1.htm
The walls of the guideway will likely house the propulsion system.