If I buy steel for $1000 and pay 10% tariff the total cost is $1100

If I make a car out of the steel and sell it I don’t pay any tariff. But I’ll charge $100 more because my steel cost was higher. (If someone abroad buys it their government may force them to pay a tariff, but I don’t see that directly).

If I buy an engine I’ll pay the engine tariff, they don’t care if it’s made of aluminium, steel, wood or whatever. The custom officer will look at it and say that it is an engine and therefore it will be subject to engine tariffs.