Should we localize custom-made themes / plugins?

If you know that you or the client will NEVER need to be translated there is no need to replace all the strings within your theme with gettext.

Regarding the performance issue I found a benchmark comparing the 3 gettex methods. It also compared using the default local vs a different local and the differences were negligible which leads me to the conclusion that that you do take a performance hit when replacing all your strings with gettext.

Benchmarks

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