Virgin yesterday placed orders for 13 Airbus A340-600 long-haul aircraft in a deal worth more than $2.25 billion (1.86 billion) at list prices before heavy discounts.
It took options on a further 13, which could eventually raise the value of the order to more than $5.5 billion, making it the largest in the UK airline's history.
The first 13 aircraft are for delivery between 2006 and 2008 and will play an important role in Virgin Atlantic's plans to double its passenger volumes from four million to eight million during the next five years.
The airline, 51 per cent-owned by Sir Richard Branson and 49 per cent by Singapore Airlines, is planning to add 5,000 jobs to its workforce of 7,500 by the end of the decade.
The jobs will be shared between London Heathrow, from which Virgin Atlantic operates its main business services, and London Gatwick and Manchester, where it will expand its Virgin Holidays leisure routes.
Sir Richard said the group would add more capacity to its routes to the US, China, Japan, India, the Caribbean and Africa and was planning to launch services to several new destinations including Melbourne, Dubai, Bangkok, Mumbai, Chicago, Toronto, Jamaica, Nairobi and Rio de Janeiro. It currently has a network of 22 routes and is adding services to Sydney, Cuba and the Bahama.
The service to Sydney via Hong Kong will challenge the dominant BA/Qantas joint venture on the so-called Kangaroo route.
The expansion by Virgin Atlantic is one of the strongest signals yet that the global aviation industry is recovering. In recent weeks both Airbus and Boeing have announced significant production increases for civil aircraft, in spite of the threat to airline profitability posed by the surge in oil prices.
Sir Richard is rapidly expanding his aviation interests. He plans to launch a low-cost carrier, Virgin America, in the US next year and is also considering airline investments in Nigeria and India. He said there had been a "ferocious battle" between Airbus and Boeing for the order.
Airbus had supported the initial financing of the deal and had provided flexibility for Virgin Atlantic's future fleet planning by agreeing to take back some of the airline's older A340-300s, if the carrier wanted to slow its rate of expansion.
