The theory is that in cities the size of Coventry there isn't the room for full sized trams and this is an alternative. The other big selling point is that because of the weight you can basically install the tracks into existing roads without having to re-route utilities thus saving a huge amount of money, time and avoiding having roads closed for months or years, plus you can easily lay track off road to cover routes buses can't take.
If it is successful the city owns the IP and can make money selling it to other cities, most likely via a private sector partner.
In terms of capacity it is claimed they will run so frequently that the total capacity will be well above conventional buses and be in line with traditional tram systems elsewhere.
People that know far more about this stuff than I do seem to think that when longer distances are involved this type of thing is a better option than buses and leads to more modal shift. Of course that very much depends on what system we end up with and how reliable it is. There does seem to be a fairly decent chance we've just reinvented the wheel and spent a lot of money on something nobody else is interested in.
There is, or at least was, another system being looked at for different routes in the city which from memory involved driverless buses but not heard anything about that in a while so that might have been quietly dropped. Think it was tied to Andy Street's travel plans than only seem to get any traction in Birmingham and Wolverhampton.