According to Aviation Week Airbus is looking to boost the performance of the current A320 beyond the addition of winglets. They qoute Colin Stuart, Vice president for marketing at Airbus.
They will try to reduce drag by recalibrating airflow using the flow-modelling software developed for the A350. Engine pylons for instance will be redesigned.
Stuart hopes that IAE and CFM will improve their fuelburn on the current engines, and PW6000 on the A318.
Boeing will probably be first to the market with a completely new replacement aircraft.
[Edited 2006-03-22 19:01:41]