Reshoring & Tariff Strategy worked example

Domestic Content Cost Premium at 81% domestic content qualifying share: a worked example

What does the result look like when domestic content qualifying share reaches 81%? The full calculation is worked below with real intermediate numbers. Use it to weigh the price premium of meeting domestic-content thresholds against tariff savings or Buy America eligibility.

The inputs for this scenario

  • Units sourced domestically: 25,000 units (unchanged)
  • Per-unit price uplift vs import: 3.4 $/unit (unchanged)
  • Domestic content qualifying share: 81 % (raised for this scenario; the documented default is 70)
  • Requalification and tooling cost: 18,000 $ (unchanged)

Working through the calculation

  • Applying the documented formula (Total premium = units x per-unit uplift x qualifying content share + requalification cost) to the inputs above produces each figure below.
  • At this operating point the engine returns 86,850 $ for total domestic content cost premium cost, the number this scenario is built around.
  • At this operating point the engine returns 3.47 $ / piece for domestic content cost premium cost per unit.
  • At this operating point the engine returns 68,850 $ for variable domestic content cost premium cost.
  • At this operating point the engine returns 18,000 $ for fixed domestic content cost premium adder.

How this compares with the baseline

  • Against the tool's baseline example, where domestic content qualifying share sits at 70% and the headline result is 77,500 $, this scenario comes in 12.06% above the baseline at 86,850 $.
  • A figure at this level is achievable when domestic content qualifying share is genuinely sustained, not just peaked for a shift. It assumes a uniform per-unit uplift across all units and a single qualifying share, but real domestic content is measured by value of components and labor, so the qualifying share can shift as the bill of materials changes.

Results at a glance

  • Total domestic content cost premium cost: 86,850 $ (headline result)
  • Domestic content cost premium cost per unit: 3.47 $ / piece
  • Variable domestic content cost premium cost: 68,850 $
  • Fixed domestic content cost premium adder: 18,000 $

Run it with your numbers

  • Every input above is editable in the live Domestic Content Cost Premium calculator, which recalculates instantly and can be shared with the inputs intact.

Last reviewed 2026-05-12.