NEW YORK (Reuters) - Entrepreneur Richard Branson on Wednesday unveiled a model of the spaceship he hopes will be the first to take paying passengers into space on a regular basis next year.

Branson, whose Virgin Galactic is one of several commercial enterprises vying to offer the ultimate in sightseeing, said his SpaceShipTwo will start test flights later this year.

"Two thousand eight is going to be the year of the spaceship. We're excited about this, and everything it will do," said Branson at a media event at the American Museum of Natural History in Manhattan."

Virgin Galactic, part of Branson's airline, vacation and retail company Virgin Group , has more than 200 people signed up and $30 million in deposits for the rides, which cost about $200,000 per person.

The company has signed up 150 passengers, including physicist Stephen Hawking, former soap star Victoria Principal and designer Philippe Starck.

The space trips, from a launching pad to be built in New Mexico, are expected to take about two and a half hours, with about five minutes of weightlessness.

SpaceShipOne and its launch aircraft WhiteKnightTwo, also unveiled on Wednesday, were designed by Burt Rutan, whose SpaceShipOne collected the Ansari X Prize for privately funded space flight in 2004.

Branson teamed up with Rutan shortly after to design a sub-orbital spacecraft for Virgin Galactic.

Sub-orbital flight is the easiest and briefest form of space travel, where the spacecraft technically reaches space -- about 62 miles above sea level -- but then falls back to Earth without completing a revolution of the Earth.

Virgin Galactic is only one of several high-profile contenders in the new commercial space race.

Others include Europe's EADS Astrium; Blue Origin, started by Amazon.com Inc founder Jeff Bezos; Space Exploration Technologies Corp (SpaceX), created by PayPal founder Elon Musk; Rocketplane Kistler, and hotelier Robert Bigelow.

The leader in the budding sector is Space Adventures of Vienna, Virginia, which started the space tourism phenomenon in 2001 when it put U.S. businessman Dennis Tito on a Russian Soyuz spacecraft headed for the International Space Station for a reported $20 million. It has since sent another four paying customers into space the same way.

(Reporting by Bill Rigby; Editing by Brian Moss)
© Copyright 2007 Reuters.

Photo:
Virgin Chairman Sir Richard Branson smiles during a meeting of Chinese and British entrepreneurs in Shanghai January 19, 2008. REUTERS/Dylan Martinez