What it could possibly come down to is whether the turbocharger was Ground or Altitude Boosted. If it were an Altitude boosted turbo it would not cause a problem as it only aims to maintain MSL power up to a specific altitude. I'm assuming that the turbo fitted on this aircraft was ground boosted and that is the reason why there was insufficient power.
Could it be possible the engineers/pilots thought it was altitude boosted? Because in that case the aircraft could fly it would just never get to its service ceiling but still be quite capable below 10 000ft.