If a machine shop completely blows by their quote for a widget, would you as the customer, pay the additional amount? I'm leaving this rather open ended for now, to see what the concensus is. I'll fill in the details later.
My guess is one of the higher-ups has a vested interest in this shop. Start documenting price-overruns, screwups, and excessive lead times. It may give you some bargaining power when you are jacked up about why your projects are costing too much and taking too long. Tough spot to be in. Good luck.