This is great news for the UK travel agent community who have long supported Cunard

Pamela Conover, Cunard president

The new 85,000-tonne vessel announced on Friday will operate from its home port of Southampton.

Pamela Conover, president of American-owned Cunard, said the company was "thoroughly committed" to expanding its presence in the UK.

"The announcement of this exciting new-building project ... confirms Cunard's determination to maintain our position as the choice British brand," she said.

Sterling

Cunard already runs the QE2, launched in the 1960s as well as the Caronia, which will be repositioned and based in Southampton from May next year.

The new ship has yet to be named but will include a range of accommodation, much of it ocean-facing.

The on-board entertainment and lecture programme will be designed with UK passengers in mind and on-board currency will be sterling.

"This is great news for the UK travel agent community who have long supported Cunard," added Ms Conover.

The new ship is the first to be built for Cunard by Italian shipyard Fincantieri, which has built more than 7,000 vessels.

The 2,620-passenger Queen Mary II, being built in France, is due to join the Cunard fleet in December 2003.