It appears to be common Hackernewserthink that "productivity" equals "the ability to write code as fast as possible". Beyond the first few weeks of coding, you'll spend much more time reading code and refactoring it.
What Xtend offers is an object model and type system that anyone with Java experience can understand right away, but with significantly more readability. This means better maintainability, which means a significant productivity increase once you're past the "hack away, guys!" stadium.
Coffeescript has exactly the same major advantage over JavaScript. The point is that because CoffeeScript/Xtend so closely mimic their target language, there are no leaky abstractions, so no thinking-in-two-worlds headaches. Yet, the code becomes significantly more readable, which matters.
These developments really are major. There's a reason so many more people use CoffeeScript than, say, ClojureScript or GWT. The only reason why the same wouldn't happen with Xtend in the Java world is non-technical: too many Java shops are conservative and afraid of change, even change as low-barrier as Xtend.
They should've called it "Coffee", though.