They saw their performance at risk. Under a cost contract they can move bodies around. The program can ask the contractor to throw a body at any problem that comes up. This is how costs escalate. Under cost-type the contractor has no risk.
Government takes all the risk.
If contractors do not perform satisfactorily we pay them to re-perform. Our only option is to reduce the award fee. That is not much of an incentive. Most contractors will do anything they are asked because they will get paid for it. The contractors goal is to make the project manager happy.