The 1e7 hours is for gear that we have already sold to them. They took their time to getting around to doing the quality audit. And they are unlikely to go out of business.
There is a certain class of businesses that enjoys (there is no better word, since it's illogical) bullying small vendors. They don't dare pound on NI or Agilent.
I've noticed that the semiconductor industry is especially bad in this respect. They flood a small company with really insane amounts of "quality" nonsense, "copy exact" craziness, cost reporting and reduction demands, buggy spreadsheets to fill out, and IP ownership issues. The aerospace companies, on the other hand, are nearly always competent and reasonable.