I first noticed this in transportation. Hot shot truckers would underbid each other until there was no profit left to make. Then they cut corners to force something out of their work. Same thing in construction. Underbid every other company, then when you get the job, cut corners, use cheaper materials, stuff the subs until you get back in the green. Entire industries exist based on undercutting the competition and then screwing the client.
In my over 30 years of pricing jobs, I’ve found that everyone is usually right on the same neighborhood without conferring with each other. I highly doubt this guy’s assertion that contractors don’t know their own numbers.