Is the sky falling?

Over the past several months, the airline industry has experienced continuing turmoil as fuel costs rise and competition becomes more cutthroat. Although it is safe to say the industry never fully recovered from the catastrophic events of Sept. 11, many airlines are struggling now more than ever.

In the past week alone, three major U.S. airlines have declared bankruptcy and shut down passenger operations completely. ATA Airlines, Aloha Airlines, and Skybus all cited rising costs of jet fuel as leading reasons for their collapses.

ATA also blamed the unexpected loss of a major military contract as a cause for its sudden shutdown. ATA had been in business since 1973 and Aloha since 1946. Skybus was a startup that failed just one year into its existence.

Many airlines still in the sky have been overwhelmed by more than rising fuel costs. Early in March, Southwest grounded 41 planes after the Federal Aviation Administration (FAA) discovered the airline had been flying an uninspected aircraft. The aircrafts were older Boeing 737 models, which are supposed to have extra inspections for cracks in the fuselage.

The FAA has claimed that from June 18, 2006 to March 14, 2007, Southwest operated 46 airplanes that did not comply with safety inspection requirements. The inspections were part of the FAA's Airworthiness Directive (AD), part of which requires inspecting older planes for fatigue cracking in the fuselage.

The news was a shock to consumers, as Southwest has consistently been rated one of the best airlines to fly. As a result of the infraction, the FAA levied a $10.2 million fine on Southwest, the largest the FAA has ever imposed on a carrier.

Southwest isn't the only airline to have inspection issues with its aircrafts. On Tuesday, American Airlines canceled nearly 500 flights in order to inspect its MD-80 aircraft. The MD-80 is an older plane that accounts for almost half of American Airlines' fleet. The issue was technical, and did not affect flight safety.

This is the second time in one month that American Airlines, the world's largest airline, had to cancel flights due to an inspection concern. Last month, American cancelled over 300 flights for a similar issue.

Safety concerns, flight cancellations, and bankrupt airlines have all contributed to the hardships of the airline industry. But its most recent blow came on Monday, when the Airline Quality Rating (AQR) survey was released.

The AQR survey found that in 2007, airlines had their worst performing year ever. Contributing to this weaker performance was a higher number of bags reported lost, a higher number of passengers bumped, a higher number of passenger complaints, and fewer flights arriving on time.

The low-cost carriers held their customary spots on top of the survey. AirTran, JetBlue, and Southwest had the three highest scores. Comair, American Eagle, and Atlantic Southeast had the three lowest. US Airways took the honors for the most customer complaints.

However, declining ratings comes as little surprise. More and more often, airlines have been forced to cut jobs and raise fees for flying, which will inevitably result in lower customer satisfaction. Many airlines have added a fee to check a second bag to help offset costs. Northwest, Continental, United, and Delta all now charge a $25 fee each way to check a second bag, much to the dismay of their customers.

The Airline Quality Rating survey has been compiled annually since 1991. In 2007, the industry as a whole received the lowest overall quality score since the inception of the survey. The research for the AQR is sponsored by Wichita State University and the Aviation Institute at the University of Nebraska at Omaha.