RIO DE JANEIRO, June 6 (Reuters) - Southwest Airlines ( LUV ) expects Boeing's ( BA ) long-delayed 737 MAX 7 to enter revenue service in 2027 and remains focused on the MAX family rather than adding another aircraft type to reduce risk, Chief Operating Officer Andrew Watterson told Reuters on Saturday.

Asked about Airbus's A220, Watterson said Southwest ( LUV ) was focused on the MAX.

"Diversification doesn't come through a second fleet type," Watterson said in an interview on the sidelines of the International Air Transport Association's annual meeting ​in Rio de Janeiro. "A second fleet type can increase your risk." 

"It doesn't make sense to lose focus on that," he added.

The MAX 7 is still awaiting certification from the U.S. Federal Aviation Administration. Watterson said Southwest ( LUV ) plans to do about six months of internal work after certification, including adding the aircraft to its operating specifications and manuals.

"The clock starts when they certify it," he said.

Watterson said the MAX 7 delay had not forced Southwest ( LUV ) to hold back specific routes, but had limited its ability to better match aircraft size with demand. The penalty, he said, is having too many larger aircraft and not enough smaller jets for periods or markets with lower demand.

STARLINK ROLLOUT

Southwest ( LUV ) is also moving ahead with Starlink-powered Wi-Fi, but Tony Roach, the airline's chief customer and brand officer, said the carrier has not ruled out Amazon's Leo satellite network.

Roach said Southwest ( LUV ) expects to have an aircraft serviceable with Starlink later this month.

The airline has targeted equipping 300 aircraft with Starlink by year-end, but the pace depends on how fast Starlink can supply equipment, the executives added.

"Our tech ops can retrofit as fast as Starlink can deliver," Watterson said.

Watterson said activist investor Elliott Investment Management was right that Southwest ( LUV ) had been too slow to change, even though many changes were already underway.

"What Elliott was unequivocally correct about is we were too slow," he said.

Watterson said investors had underestimated Southwest ( LUV ) customers' willingness to pay for new products, and said revenue per available seat mile would be the "litmus test" for whether the changes are working. 

(Reporting by Rajesh Kumar Singh in Rio de Janeiro)