You must fight it at least twice, but then you can defeat it for good - as the others have said. My advice would be to give Squall the elemental-attack of Thunder and also junction to increase his HP. Then, get his HP down so you can keep using Renzokuken. He'll deal a lot of damage. If you drew Double spells from the Evloret on top of the tower, use those so that your best magic-user can cast two thunder, thundara or Water spells on every turn. Your third character - usually Zell, in this case - should either attack normally or summon Quetzacotl, but he should definitely be ready as a healer, just in case.
Simply keep attacking, and the machine will go down in flames eventually.