This "up-and-down chain" should stop pretty quickly at the level where eng mgmt knows loaded costs. It's an eng manager and director's job to compute total-cost-to-execute, and opportunity cost (using loaded-costs for engineer time). They should be able to approve once you've convinced them that it's cheaper to buy than to build.

Engineers can head this off by prepping a total-cost-to-execute analysis for mgmt. This doesn't need to be complicated. It's just some estimates of what's needed and why, and what the alternatives cost. My eng VP used to ask me for these when I'd send up a request. He wanted to know that we thought about total-cost-to-execute. He'd usually only read the exec summary and approve. If these requests are really going that far up the mgmt chain either someone isn't doing their job, or higher level mgmt are micromanagers.