Lion Air could help launch Boeing 737 MAX 10 - sources

CANCUN, Mexico/JAKARTA (Reuters) - Indonesian budget carrier Lion Air may be a launch customer for the Boeing 737 MAX 10, a larger version of the planemaker's medium-haul family that is expected to be launched at the Paris Airshow, three people familiar with the plans said.

The order may, however, include some upgrades from a smaller model, two of them said.

The two companies declined to comment.

Indian budget carrier SpiceJet is also among carriers seen as potential targets for the aircraft, a version designed to seat up to 230 people and blunt strong sales of the Airbus A321neo, two of the sources said.

SpiceJet could not immediately be reached for comment.

Lion Air, which is one of Boeing's largest customers, ordered 201 Boeing 737 MAX aircraft in 2012 and placed options for a further 150.

Such orders typically include the right to convert between different variants of each model.

Other airlines are looking at the Boeing 737 MAX 10, but some are nervous about committing to a new variant given patchy sales of some current models of the 737 MAX, whose success rests mainly on sales of the Boeing 737 MAX 8, the sources said.

At least one Chinese leasing company is said to be in negotiations with both manufacturers as Airbus tries to disrupt the launch, which sources say is planned for the June 19-25 air show. Airbus declined to comment on any ongoing negotiations.

Airbus sales chief John Leahy earlier criticised the 737 MAX 10 as a "marginal" airplane, implying sales would be poor.

Boeing marketing vice president Randy Tinseth told Reuters some airlines want more seats than existing versions and that the MAX 10 would be 5 percent more efficient than the Airbus A321neo. Airbus says its own plane is more efficient.

"It (the 737 MAX 10) is not a me-too airplane. We are focusing on a better airplane," Tinseth said on the sidelines of the International Air Travel Association annual meeting in Cancun, Mexico.

(Reporting by Tim Hepher, Eveline Danubrata, Aditi Shah; editing by Grant McCool)