Australia’s struggling Qantas Airways has cancelled orders for 35 Boeing Dreamliner jets in a bid to slash costs after posting a full-year net loss for the first time in 17 years.

Qantas shares jumped to their highest in more than two months as investors welcomed cost-saving moves.

The past year has been gruelling for the company with a record fuel bill up 18 percent from last year, rising competition and a labour union opposed to spending cuts.

CEO Alan Joyce said recovery will not be easy.

(SOUNDBITE) (English) QANTAS CEO ALAN JOYCE SAYING:

“There’s no silver bullet, there’s no easy fix, there’s no exit here that’s going to solve it. It’s going to be a lot of hard work, a lot of initiatives like the initiatives that we’ve made to get that business back to profit.”

Unions opposed to the cost-cutting efforts — including job cuts and the elimination of routes — led to disputes that grounded the airline’s entire fleet for almost two days last year.

The cancellation comes as a major blow for Seattle-based Boeing since the order was worth an estimated $8.5 billion dollars.

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