Not so long ago, not so far away, soon retiring Mr. Airbus himself, saw no reason to extend the aircraft to an A322 to serve market above the A321 capacity-range..
“At 240 seats, all 18 inches wide, I see no reason to change things,” Leahy said. “At 80% market share, we own this market.”
Things can change rapidly however, such as your customers showing healthy interest in an alternative of your competitor
https://www.reuters.com/article/us-airshow-paris-idUSKBN19D0UQ An iterim " solution" beefing up the highly successful A321NEO into an HGW "LR" variant gives some new opportunities for airlines. On typical medium 3500-4000NM flights, the aircraft remains highly space & range restricted though, just like the good old 757.
For some years, enlarged A321 concepts have been doing low passes on the internet
http://www.cardatabase.net/modifiedairlinerphotos/search/photo_search.php?id=00015369, but Airbus kept quiet, until recently. The situation is changing a bit. Boeing is launching an enhanced 737-10 and seriously pushing an NMA concept and looking for a 767 replacement. The market doesn't see the 788 as an option (maybe because it is 50% bigger/heavier).
Target for Airbus seems offering something that can capture at least 50% of the 220-270 seats up to 4500 NM segment, without tying many billions and years. Developing a lean & mean machine getting the NMA job done. Becoming the first available, sharply priced requires serious considerations such as mission requirements, family concepts and broad application for many different operators. Getting the wing right seems a key success factor. Overspecification and weight creap are around the corner. Boeing offering something significantly larger might help.
New hub spokes, leisure flights, LCC's, transcons, high volume city pairs. There's seems to be market for several thousands with little competition.