I would not say that it is necessary for a manufacturer to pass on all the savings due to an increased efficiency in manufacturing. One important thing that needs to be considered is the price elasticity of demand. If a reduction in price can boost sales to a large extent, it may be advisable to reduce the price. The price at which a manufacturer makes the highest profit is that beyond which a reduction in price does not increase profits even with higher revenues.
If maintaining the same price does not reduce sales, and reducing the price does not increase profits, there is no point in passing on the savings. Any manufacturer needs to be able to offer a better deal than its competitor; if the price of both is the same, and they are also able to manage aspects like advertising, promotion, distribution, etc. in the same way, it shouldn't be necessary that the prices be brought down.