The parent company of flag carrier Malaysia Airlines is in talks with the European Airbus consortium to acquire at least six A380 superjumbo aircraft, a report said today.

The deal could cost Penerbangan Malaysia Bhd (PMB) between RM3.8 billion (US$1 billion) and RM 5.7 billion (US$1.5 billion) depending on the furnishing, with each plane to cost RM646 million - RM950 million (US$170 million-US$250 million), The Star said.

Delivery of the first four A380s was expected to begin in 2006, with PMB having an option to buy two more at a later date, sources familiar with the deal told the newspaper.

The 555-seater aircraft would be leased to Malaysia Airline System (MAS), which was expected to use them for long-haul and high-demand routes, the daily said.

"It is a good arrangement Airbus has offered PMB and MAS. It is even willing to offer PMB launch prices," a source was quoted as saying.

The A380, with its bigger capacity and a lower operational costs, would give MAS the flexibility to cut costs and to reduce airfares in the future, the source added.

Growing air travel demand

Officials from MAS and PMB, which emerged as the holding company for the ailing national carrier after a major restructuring last year, were unavailable for comment.

But Prime Minister Dr Mahathir Mohamad, who is also finance minister, had in October indicated the government was seriously considering acquiring new aircraft including the A380, for the ailing carrier.

The Star said the move was to ensure that MAS was not left out of the competition when the A380 entered commercial operation in 2006.

With growing demand for air travel in Asia, it said MAS could do with about 20 of the A380 aircraft.

MAS competitors in the region, Singapore Airlines and Qantas Airways, were among the early birds to place orders for the mega-jumbo after it was launched mid-2002.

Airbus has secured 97 orders from nine customers - Singapore Airlines 10, Qantas 12, Virgin Atlantic six, Emirates Airlines 22, Federal Express 10, Air France 10, Lufthansa 15, International Lease Finance Corp. 10 and Qatar Airways two. AFP