Many reasons:
It is cheaper.
It is quieter.
And then the big one: If you look at the latest Las Vegas system which reaches every downtown strip hotel, the airport, etc., there are lots of branch points. Like a lot. Each branch point would need a mechanical track switching system which is expensive and slow to switch. Any track switching system would slow down the entire system since the way the system is intended to be used, you could literally have every second car going to a different Left/Right turn, meaning switching a track every car. That just isn't possible and have any kind of throughput at all.
In general, I don't think people understand how Boring systems are going to work. They are thinking trains and fixed routes. In a Boring system, if you want to go from the airport to a hotel 10 stations away, you go directly there without stopping at any station, or even going through any station. ie. the tunnels are not station to station, they are continuous highways with on and off ramps to stations, which are optional for any car to take.
That's the main difference between individual cars and "rapid transit" (which is an oxymoron). Most urban buses and trains take twice as long as a car because they are starting and stopping all the time (I'm ignoring rush hour freeway gridlock, of course).
I do believe that's why Tesla has moved away from the concept of a 15 passenger van. That idea only works if all 15 people are coming and going to the same spot. Instead, in an urban system like Las Vegas downtown, you're going to have a mix of maybe 2 person vehicles with Model X 6 person vehicles. Actually, the smallest might be the eventual Model 2, but you get the idea.
You get two more benefits from using Tesla cars:
Flexibility - your routes can easily intermingle with existing traffic and infrastructure. Rather than build stations for each hotel, your cars can just drive up and drop off in the existing hotel front doors. Among other things, this means less walking for passengers - no need to walk further to get to the station.
Cost - Elon is all about using the power of mass manufacturing for cost reduction. Look at any explainer video as to why rail systems are expensive and you'll find one of the reasons is that the train cars are really expensive. They are very low volume manufacturing. Even with batteries, Tesla cars are going to be vastly cheaper than the rail/subway cars they replace (on a passenger volume basis).
BTW, did you catch that Boring is going to be actually running this system and charging fares for it? Yep, they aren't only a tunnel boring company, they are going to be the operator of the system and charge taxi like fares for rides. The entire Las Vegas Boring tunnel system is costing Vegas $0.
It would be criminal for any city to not use Boring right now for a new system. Which is exactly why they will continue not doing so
Boring mass transit is going to be so much better than taxi or monorail, or any other transit system...
