Singapore Airlines (SIA) and Virgin Atlantic are in talks to set up a joint-venture carrier with an all-A3XX fleet, increasing pressure on Cathay Pacific Airways to order the aircraft. The A3XX is the world's biggest civil aircraft planned by Europe's Airbus Industrie, with more than 555 seats and space for bars, gyms and casinos. Philippe Jarry, vice-president of Airbus, confirmed the two carriers were in talks to set up such a company, but had yet to approach Airbus on the subject. 'We are aware of the discussions,' Mr Jarry said. 'But we have not been approached.' SIA and Virgin Atlantic, in which SIA has a 49 per cent stake, have announced interest in becoming launch customers for the A3XX aircraft. Mr Jarry said Cathay would be under more pressure to order the A3XX. 'If my neighbour has it and I don't, what is the survival curve?' Mr Jarry said. SIA is seen as Cathay's main competitor, while Virgin is the main rival to British Airways, Cathay's alliance partner in oneworld. Some analysts agree a SIA-Virgin venture would put more pressure on Cathay to acquire the A3XX aircraft, which Airbus says has 35 per cent more space and up to 20 per cent lower operating costs than the Boeing 747-400. 'I think the risk is there from the operational-cost side, rather than the product side,' said Mark Webb, aviation analyst at HSBC Securities Asia. Another analyst with a US brokerage believed the SIA-Virgin initiative would be a significant factor in Cathay's decision. 'And it would make sense for Cathay to place them on capacity-constrained routes,' he said. Analysts expected Cathay to order between six and 12 of the A3XX planes, which would be placed on routes to London, Tokyo and Los Angeles, where capacity at the respective airports was becoming increasingly constrained. Cathay spokesman Quince Chong Nai-yan said the carrier had no immediate plans to announce its decision on the A3XX jumbos. She said it would place orders for the A3XX if the 'economics were right'. The A3XX, which would cost US$10.7 billion to develop, is scheduled to be in operation by 2005. Airbus expects airlines in the Asia-Pacific to account for 55 per cent of all super-jumbo jets sold in the next 20 years.