I do not expect costs to go down, and therefore I dont expect the cost of the Rotary to go down. The business model will still rely on paying USA labor rates for qualified staff. USA labor rates are not going down.
Depending on how they move things in-house, you can wildly cut "handle time" in manufacturing.
I get the impression HDS currently is using a LOT of labor for manufacture and assembly (hard emphasis on the latter). If they redesign the new bodies to ease manufacturing and assembly, there absolutely can be massive cost reductions.
If anyone has been around a company that moved from a bank of mills and jigs to a (or pair of) CNC machine(s), or redesigned a product with consulting a (or a group of) production engineer(s), the productivity gains can be absolutely jaw dropping; orders of magnitude.
If Henry is thinking about the company after his tenure, now would be a good time to redesign the next model to not require highly skilled hands to assemble it (and, again, this can be a massive savings), or highly skilled machinists (and/or lots of waste products). If a company moves to an easier-to-manufacture, standardized parts list that can be assembled quicker and/or without technical knowledge, that's cutting costs on both ends, and it doesn't make for a worse product (often the opposite, as there is less to go wrong). This also WAY cuts down on QC, which is a MASSIVE driver of costs (far more than actual manufacturing and assemble for most places).
I'm in the Midwest, so...manufacturing. Re-shoring had been going on before the political pressure simply because the U.S. tends to be really productive. People are generally surprised to see how little the labor cost differences can be manufacturing in the U.S. versus China (some companies make enough products that the cost matters that much, or, alternatively, they're just that greedy). I think people conceptualize things as of more historical manufacturing (very labor intensive) than what is the norm these days (highly automated and technical), and are often shocked to find a "household name" might be a single factory with more people in the warehouse or front office than running machines.
I don't know what HDS looks like today, but again, if they really are looking to redo things to keep the company moving forward after Henry retires, setting things up to be more automated would definitely fit into that plan nicely, and they might incidentally find a leap forward in productivity.
I know many people think, "Prices never go down" on things, but that's actually not true for most items, adjusting for inflation. If you get bored and read into inflation data over the last few decades, you can find all sorts of interesting costs that have dramatically declined - spoiler alert; good tend to decline in costs, while services tend to peg to inflation (which is why "costs always go up"). I mean, just look at computers, TVs, phones, etc. I haven't bought a new monitor in a decade, and I recently looked. Wow. You can get AMAZING monitors for what I paid 10 years ago. That's actually true for a lot of goods.
Whether or not HDS will be doing that is up in the air.
My other impression is they're maybe taking a new direction with a completely different product, so maybe the flashlights will literally become a boutique product they make just for legacy/fun, and this entire conversation was mostly for naught, haha.
I guess we'll see how it all shakes out over the next few years.