Suppose the average rider's trip is 10 stops. At every stop where the rider does not get off, there is inefficiency because they sitting there, taking up a seat on a train that is stopped. You're not only wasting their time, you're also wasting train capacity.
The naive solution is to make the train longer. Which works, but it's costly because you also have to make the platform longer. In a subway system, that's expensive. And the worst part is, you have to do it for every station the train will stop at, even the ones that aren't as busy.
This is, of course, why express trains exist. Eliminate some stops and you reduce all these problems. But the more stops you eliminate, the fewer people can use the express (because it doesn't stop where they're going), so there's an unavoidable compromise.
In the days before automation, this was probably the best that could be done. But now that automation exists, new approaches are possible.
Since you no longer need a driver per train, you now have the option of making trains smaller. And it's also possible to group people together by starting point and destination. So in theory you could make every train an "express train", one with zero stops other than starting point and destination. No seats wasted on making people wait in a non-moving train while others get on/off. So you can eliminate an inefficiency that you never could before.
Of course, every train needs headway for safety reasons. More smaller trains instead of fewer larger trains means that's harder. So it's not without its own, different limitations. Maybe automation has fast enough reaction time (or other tricks) that can cut down on the physical space needed for headway.
Anyway, the point is that much smaller vehicles might actually increase efficiency, and this is what the Boring Company seems to be planning to do.
