More vehicle deregistrations may not result in immediate COE upswing

We thank Mr John Francis Khng for his feedback ("Why is car population declining?"; Oct 21).

The supply of certificates of entitlement (COE) is determined by two main factors - replacement COEs for vehicles that have been deregistered and the additional COE quota given by the prevailing annual vehicle growth rate.

When a car is deregistered, the COE will be recycled and added to the supply of COEs for bidding, albeit in the next quarter.

In the past two years, the number of cars deregistered has indeed risen.

Although this should have translated into a higher COE supply, the effect was not felt immediately due to a slight lag.

In February last year, we further refined the COE system so that new quotas are determined every quarter rather than six months, reducing the lag effect and mitigating the extent of the temporary reduction.

Helen Lim (Ms)

Director

Media Relations

Land Transport Authority

A version of this article appeared in the print edition of The Straits Times on November 06, 2015, with the headline 'More vehicle deregistrations may not result in immediate COE upswing'. Print Edition | Subscribe