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(Bloomberg) -- Ryanair Holdings Plc warned that it could be forced to pare back its schedule in the peak summer travel season amid fresh delays in jet deliveries from Boeing Co.

The Irish discount carrier may receive fewer than 40 Boeing 737 Max jets before the end of June, Chief Executive Officer Michael O’Leary said. A shortfall of that magnitude would force Ryanair to cut its annual passenger forecast to 200 million people from 205 million for the coming fiscal year, he said at a media briefing in Dublin.  

Aircraft shortages are likely to drive up European fares this summer, O’Leary added, as competitors such as Wizz Air Holdings Plc and Deutsche Lufthansa AG ground planes to address an engine issue on some Airbus SE jets. 

“We’re doing our budgets based on a fare increase of between 5 to 10%, O’Leary said. “To me it feels kind of reasonable.” 

Read More: Ryanair Plans Growth in Central, East Europe as Wizz Cuts Routes

As recently as last month, Ryanair remained “reasonably confident” Boeing would deliver 50 new jets by summer, after a near-disaster in early January forced the US planemaker to slow output. The airline originally was due to take 57 Max jets between summer 2023 and 2024.

“Our growth has been constrained because at this point in time we don’t really know how many aircraft we’re going to get from Boeing,” O’Leary said. “I think 40 looks like the most realistic number but that’s moved down from 50 in the last two weeks.”

Bonus, Boeing Crisis

Ryanair makes most of its money in the summer season and cuts to its schedule mean lower revenue. O’Leary said the carrier had based its planning on the expectation it would receive 50 planes, and it will have to make some schedule cuts if it doesn’t receive at least 40 by March, its fiscal year-end.

“There is a debate with Boeing as to whether we’re entitled some compensation for these delayed deliveries,” O’Leary said.

Ryanair shares rose 1.1% to €20.67 at 8:43 a.m. in Dublin. The gains puts the stock near the €21 threshhold that, if sustained, would hand O’Leary a massive €100 million bonus payout. 

Boeing has lost 23% this year, the worst performance on the Dow Jones Industrial Average.

The midair blowout on a 737 Max jet on Jan. 5 has led to withering scrutiny of manufacturing quality at the US planemaker. Factory output has slowed as Federal Aviation Administration inspectors review quality controls at Boeing and its fuselage supplier. The agency has barred Boeing from increasing production rates of the Max until they’re confident quality has improved.

“We are communicating with customers that some delivery schedules may change as we take the necessary time to make sure that every airplane we deliver is high quality and meets all customer and regulatory requirements,” Boeing said in a statement. The company is working to address Ryanair’s concerns “and taking action on a comprehensive plan to strengthen 737 quality and delivery performance.”

Last week, Boeing announced it ousted Ed Clark, the head of the 737 Max program. Katie Ringgold succeeds him, while production chief Elizabeth Lund has been made the senior vice president of quality at Boeing Commercial Airplanes. 

O’Leary said he wasn’t happy with the changes, saying Boeing should have one person responsible for producing 737s without quality flaws.

--With assistance from Siddharth Philip.

(Updates with Boeing comment in 11th paragraph)