A bid for £2.9m towards building a museum to house the last Concorde to fly has failed.
But the Concorde Trust said it remained positive about the £9m project in Bristol despite being turned down by the Heritage Lottery Fund (HLF).
Trust chairman Mike Littleton said: "Although the HLF decision is a setback, we remain determined to make this project a reality."
The Save Concorde Group (SCG) said the plans were too ambitious and costly.
Ben Lord, chairman of SCG, said they had a "more realistic" plan which was "a fraction of the cost" and would be presented to British Airways in the next few days.
The plane - called Concorde 216 or Alpha Foxtrot - was the last of the fleet to fly when Concorde was withdrawn from service by British Airways in 2003 due to increased running costs.
The Concorde Trust plans for the museum at Cribbs Causeway were first submitted in 2007 but building work has never started because of a lack of funding.
The museum was given a £840,000 cash boost by Airbus last week but has almost £8m still to raise.
Mr Littleton said he did not see the HLF failure as a blow to attracting other investors and that the vision was still to open the museum in 2014.
He said the trust was evaluating feedback from the HLF with a view to resubmitting its application in the near future.
It is also pursuing other major sources of funding.
"We now need some time to review and decide our next steps, but remain confident," Mr Littleton said.
"Our professional team delivered a first class bid to the Heritage Lottery Fund with a project that was exceptionally well researched, financially sustainable and, we believe, met the funding criteria.
"Given the overwhelming support we received from the general public, local government, industry and education, we are confident that we can deal with the issues and succeed with our ambitions."
Mr Littleton said feedback from the HLF was that requests for funding had been three times greater than the amount available and that he did not think the plans were too ambitious.
"This is one of the cradles of aviation in the UK, the only one with a history of continuous industrial production and it remains a world-class centre of aerospace innovation," he said.
Mr Lord, of SCG, said: "We have been saying for some time that there's been a degree of ambiguity in what the Concorde Trust was setting out to achieve.
"We did support it as it was the only plan being fully pursued to get Alpha Foxtrot under cover, but we also voiced our concerns that it was over-ambitious in terms of the cost of the project."
He said: "While all of this has been going on, SCG has been looking into a much more realistic plan that would see Concorde remain as centre-stage and offering the world-class exclusive tours that the previous 'Concorde at Filton' exhibition had been offering.
"While it is in its early stages, we believe that this plan is totally achievable and would ensure ongoing prominence of this aircraft's unique association with Filton and Bristol as a whole."
The jet has been at Filton since 2003 and was closed to the public in October 2010 for maintenance.
Filton Airfield, where the jet is based, is to close from the end of 2012, meaning a new home will soon have to be found for the jet.