This could turn out to be a boon to the used car market, as climbing COE prices - a likely result of smaller supply - squeeze out marginal buyers and push up the resale value of cars now on the road.

This, in a nutshell, is how industry players read the market following changes announced by the Transport Ministry to curb congestion and shift upfront costs of car ownership to usage.

The changes include a tighter allocation of COEs and cutting of car registration and road taxes.

Mr Raymond Tang, secretary of the Singapore Vehicle Traders Association, which largely represents used car traders, said the measures will have a positive impact on car owners and some car sellers 'in the long term'.

'No matter how low the supply of COEs or how high the premiums, people will still want to own cars,' he noted.

'If COE prices don't rise, motorists can't sell their cars. If they can't sell their cars, they can't buy another one.'

Mr Neo Nam Heng, who heads the Automotive Importers and Exporters Association, whose members are parallel importers, said the market is 'at a turning point'.

After nearly a decade of increasing COE supply, there will be fewer certificates in the next several years, he said, adding: 'The days of abundant COEs are over.'

Read the full story in Saturday's edition of the Straits Times.