* Looks set to place $40 billion order at list prices
* One of industry's biggest-ever by volume
* Airbus had lagged Boeing in orders this year (Recasts, adds details)
DUBAI, Nov 15 (Reuters) - Veteran airline investor Bill Franke looked set to place a historic $40 billion order for around 400 Airbus jets, shaking up the low-cost industry and turning the annual race between Airbus and Boeing for plane orders on its head.
Franke, whose Phoenix-based Indigo Partners controls Frontier Airlines and owns part of Mexico's Volaris, flew to the United Arab Emirates on Wednesday and was expected to sign the deal at the Dubai Airshow, marking one of the industry's biggest ever deals by volume, two people familiar with the matter said.
Airbus and Indigo Partners declined to comment. Bloomberg News earlier reported the potential contract involved 430 jets.
The deal marks a dramatic turnaround for Airbus, which had been lagging behind Boeing in the contest for orders so far this year and had started the Nov 12-16 air show on a backfoot.
With Boeing so far dominating the show, delegates said all eyes were on Airbus where sales chief John Leahy, a veteran of last-minute air show surprises, was plotting a blockbuster climax to a more-than-20-year stint as marketing boss.
Leahy is due to retire in coming months after serving as sales chief for the European planemaker since 1994. (Reporting by Tim Hepher and Alexander Cornwell; Editing by Himani Sarkar)