Is Delta Air Lines competitive with the B737-900ER?

Yesterday came the press release confirming Delta's order for 100 B737-900ER.

These will delivered between 2013 and 2018 and there is no mentioning of a possibility to switch to the reengined variant.
In the press release Delta stresses a fuel burn advantage of 15-20% against the B757, B767 and the A320. If fuel is responsible for about 40% of your cash operating costs, this is big and results in 6-8% lower COC's. But to be competitive, Delta has to look what the competitors will do, especially the low cost carriers, which have lower COC's to begin with.
Virgin America and jetblue have ordered the A320neo
. Virgin America will take their first delivery in 2016, jetblue will get their first "neo" later, in 2017, after their last "classic" A320 arrived. As jetblue changed some of their A320 orders over to the A321, it is not unlikely that they will also take some A321neo's as part of their A320 neo order.
So let us compare the fuel burn per trip and per passenger of the B737-900ER, the A320neo and the A321neo and look at typical mission ranges. According to jetblue's monthly traffic statistics, the average trip length of all flights is around 1100nm. The average trip length in Virgin America's network is around 1400nm. And I also looked at flight at a 500nm trip length.
Delta will fly the B737-900ER with 180 seats, the typical 2-class layout of this aircraft.
jetblue has 150 seats in their A320's, the A321 can seat 185 with the same comfort level (read: seat pitch).
Virgin America has a 3-class layout (8/12/129) with 149 seats overvall.
The A320neo will seat 153, as the layout in the aft cabin changes, but I for the "per seat" charts I used 150 passengers for now.

Fuel burn/trip for the B737-900ER, A320neo and the A321neo

The fuel burn/trip difference between the B737-900ER and the A321neo is not that big for a short mission, as the higher weight of the Airbus is somewhat negating the more efficient neo engines. But as the trip length gets longer, the B737-900ER gets heavier compared to the A321neo, as it has to carry more and more fuel.

Fuel burn/seat of the A320neo and A321neo relative to the B737-900ER

The fuel burn/seat difference between the A320neo and the B737-900ER is more or less negligible for short routes, but on typical routes that Virgin America flies it extends to more than 6%.The A321neo, offering a comparable capacity as the B737-900ER, is almost 9% more fuel efficient even on short routes and that extends to more than 10% on typical jetblue routes.

What does that mean for COC? Given that fuel costs are 40% of COC, Virgin America has an edge of 2.4% from the fuel burn/passenger, jetblue (with an A321neo) would have 4% lower COC just through the fuel burn difference.

And, even worse for Delta, their operating costs ex fuel, are much higher than costs at jetblue (Virgin America is not publicly traded, so they do not have to publish their cost spreadsheets, but their costs ex fuel should be comparable to those of jetblue).

CASM ex fuel for Delta Air Lines and jetblue according to 10-Q Reports

So, very clearly, the Delta's move from the B757 to the B737-900ER is a big step forward in terms of fuel consumption as a recent post from AirInsight explains - but the competition seems to be just another step ahead once Delta has all these aircraft in the fleet.