Sir Richard Branson's Virgin brand is looking to take on the likes of Ryanair in the transatlantic low-fare airline market.

Last week Ryanair chief executive Michael O'Leary said that his company would launch flights to the US with tickets priced from just £7.

Now it has emerged that Virgin America - which will begin flying US domestic routes in July - is also planning a budget service linking the UK with the States.

An airline source told The Daily Mail that the company is in discussions to buy a fleet of Airbus 330, Airbus 350 and Boeing 787 aircraft that will provide no-frills transatlantic services.

The planes will be fitted with business class seating but a budget section will allow Virgin America to offer cut-price tickets as well. A time frame was not indicated, but Ryanair plans to launch its own transatlantic flights within three or four years.