The 65 Percent Question: Domestic Content and the 2029 Step-Up

The second door out of the Covered List — domestic manufacture under the Buy American standard — looks, from a distance, like the simpler one. No national-security review, no interagency queue. Just build it here. The distance is deceiving, and the reason is arithmetic.

The floor is a moving target

Qualification today requires 65 percent domestic component content. In 2029 the floor rises to 75. A bill of materials engineered to clear 65 with two points to spare is not a compliance achievement; it is a scheduled failure with a 2029 date on it. Every content strategy must be built against the number the product will face over its life, not the number in force at first certification.

Where the points actually come from

In an inverter, the heavy content — magnetics, power semiconductors, enclosures, boards — determines the outcome. The practical work is unglamorous: which subassemblies can move to US or qualifying suppliers at acceptable cost, in what order, and what the substantial-transformation analysis will bear. A Customs binding ruling, sought early, converts the riskiest judgment in the file into a settled one.

The grandfather clause is narrowing

A quieter development bears on every manufacturer sitting comfortably on previously-authorized models: on June 26, 2026, the Commission moved to prohibit importation and marketing of previously-authorized equipment from the legacy Covered List entries, and a July rulemaking proposes extending that mechanism to further covered equipment. "Our existing authorizations are safe" is a statement with a shortening half-life. Grandfathered SKUs are a wasting asset — a runway, not a shelter — and the length of that runway is a Commission decision, not yours.

The two doors are one strategy

The deepest error we see is treating Conditional Approval and domestic content as rival paths. The register says otherwise: approvals now arrive conditioned on onshoring plans, and onshoring plans mature into content qualification. The manufacturer who files for Conditional Approval this year, stands up final assembly next year, and crosses the content floor the year after has not chosen a door. It has walked through both, in order, on one set of documents.