Furious Praful Patel cancels 'pricey' Air India makeover deal
04 August 2010
National carrier Air India today said it has cancelled a $1.6-million (Rs7.5 crore) brand makeover deal with an Australian firm for the upcoming Commonwealth Games. "The project with Australian branding firm Cato Purnell Partners has been cancelled. The decision was taken yesterday (Tuesday) evening," an Air India spokesperson said.
The spokesperson gave no details except to say that the project with Cato Purnell had been annulled "following a review of the brand and identity management plans''. However, it is widely believed that the agreement was cancelled after a controversy broke out following a question asked in Rajya Sabha on Tuesday on whether the ailing national carrier had entered into such an agreement.
"Since National Aviation Company of India Ltd (NACIL, the holding company for Air India) has been designated as the official carrier for the Commonwealth Games, Cato Purnell Partners have been appointed by NACIL to revitalise its brand identity,'' Patel had said in reply to a question.
He also informed the house that the fees payable to Cato Purnell Partners would be around $1,612,750 plus taxes. Apart from branding activity, the Australian firm was to assist Air India in the design and construction of its domestic and international lounges at the new Terminal 3 of the Indira Gandhi International Airport.
Aviation ministry top brass claim it got to know of this expensive move only on Monday when it saw replies to Parliamentary questions that were to be laid in the Rajya Sabha on Tuesday based on information given by various agencies, including Air India, under it.
Aviation minister Praful Patel tabled this reply on Tuesday morning and was livid at the AI management after realising how exorbitant their image makeover deal was.
According to reports, the ministry asked the two government directors on AI's board to ensure this costly exercise does not take off as the job could have been carried out at much more reasonable by a domestic firm.
The consultant's fees were already approved by the board, following which the firm started its work and has given a report. While many senior AI managers question the high fee, they are in agreement with one key proposal of the firm - to bring back the Centaur on AI aircraft livery. The much loved Centaur, which had for decades graced the top of AI's headquarters in Mumbai's Nariman Point, was replaced by an uninspiring swan (a bird which is in any case not native to India).