Reshoring & Tariff Strategy worked example

Domestic Content Cost Premium at 50% domestic content qualifying share: a worked example

Suppose domestic content qualifying share falls to 50%. This page works the full calculation at that level so you can see exactly which result moves and by how much. Estimates the cost premium of sourcing the qualifying portion of a part domestically instead of importing it.

The inputs for this scenario

  • Units sourced domestically: 25,000 units (held at the documented default)
  • Per-unit price uplift vs import: 3.4 $/unit (held at the documented default)
  • Domestic content qualifying share: 50 % (the input this scenario stresses; the baseline uses 70)
  • Requalification and tooling cost: 18,000 $ (held at the documented default)

Working through the calculation

  • The calculation starts from the formula this tool documents: Total premium = units x per-unit uplift x qualifying content share + requalification cost.
  • Total domestic content cost premium cost works out to 60,500 $ at these inputs, and this is the headline figure for the scenario.
  • Domestic content cost premium cost per unit works out to 2.42 $ / piece at these inputs.
  • Variable domestic content cost premium cost works out to 42,500 $ at these inputs.
  • Fixed domestic content cost premium adder works out to 18,000 $ at these inputs.

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 21.94% below the baseline at 60,500 $.
  • It computes the total domestic sourcing premium from units, per-unit price uplift, the share of content that actually qualifies, plus a fixed requalification cost, then divides to a per-unit premium. When the numbers land here, the stressed input is the lever to work; the walkthrough above shows exactly how much each output recovers as it climbs back toward the baseline.

Results at a glance

  • Total domestic content cost premium cost: 60,500 $ (headline result)
  • Domestic content cost premium cost per unit: 2.42 $ / piece
  • Variable domestic content cost premium cost: 42,500 $
  • Fixed domestic content cost premium adder: 18,000 $

Run it with your numbers

  • To rerun this with your own numbers, open the live Domestic Content Cost Premium calculator, set domestic content qualifying share to your actual value, and adjust the remaining inputs to match your operation.

Last reviewed 2026-05-12.