COE review is timely, just give us time to react: BMW Group Asia managing director

SINGAPORE – Rene Gerhard took the helm of BMW’s regional office as managing director in Singapore on Feb 1, just as the motor trade here found itself in a state of uncertainty, starting with the change to the vehicle tax structure in February, then the announcement in March that the certificate of entitlement (COE) system would be reviewed.

The 46-year-old father of two welcomed the COE review, but admitted that the quick succession of changes and not knowing where the rules are headed have thrown a spanner in the works.

The tax change in February significantly reduces the residual value of cars at the end of their 10-year COEs. Premium brands are especially affected because, other than the prestige that comes with the badge, residual values that are higher than mass-market cars have been part of their appeal.

Due to be completed by the end of the year, the COE review is meant to improve the categorisation of vehicles and address the current situation where mass-market car buyers are paying nearly as much for their COEs – and occasionally more – than those buying premium cars.

The current system is based on the car’s engine size and power output.

Speaking to The Straits Times at the Mandala Club in Chinatown in June, Gerhard said that with the spectrum of engine options in BMW’s portfolio, the brand is able to offer just the right version for Singapore – provided that the company knows what is needed in the first place.

Until the results of the review are announced, there is nothing else to do except to wait, he added. That, and working closely with BMW’s two Singapore dealers, looking at how the models are selling and minimising any risk of being left with unsold cars because of the changing market.

BMW ended 2025 well, being the third-biggest-selling brand in Singapore, ahead of Mercedes-Benz and behind BYD, which took the top spot, and Toyota in second place.

Gerhard’s wish is that the upcoming changes will be fair for all stakeholders, with sufficient notice for car companies to react, as they order cars months in advance.

Adding to the mix are the broader challenges that carmarkers are facing worldwide. These include the ongoing transition towards electrification and newer Chinese carmakers gaining ground at the cost to established brands.

Gerhard, who hails from North Rhine-Westphalia, a German state bordering Belgium and the Netherlands, onces worked at a Mercedes-Benz dealership as a sales consultant, among other roles. He joined the BMW Group in 2002 and his career brought him to postings in various German cities, then India, Australia and Thailand, where he stayed for just under two years before moving to Singapore.

He likened the stiff competition in the trade today to his own journey as a smartphone user who briefly switched away from an Apple iPhone, only to return to the brand. “Every person in the world has a right to try new things. And to be honest, they should, because sometimes you need to try new things in order to realise how good the product you had earlier was and how happy you were as a customer,” he said.

He noted that before the influx of Chinese brands, it was Tesla which tempted BMW owners and employees to consider switching camps. But eventually, a lot of them – staff and customers – came back, he added.

“I am realistic about the competition from Chinese brands. It’s about how we deal with it. So when you close the office in the evening and you know you did everything that you could for our people, then that’s okay,” he said.

Besides the Singapore office, Gerhard has 13 other countries under his charge, including Bangladesh, Brunei, Cambodia and Guam.

In between visiting these markets, he finds time to play pickleball. He picked up the sport partly because his wife is a certified trainer, but also because it took less time away from his family than a different type of sport, like golf, would.

Before his first product launch in Singapore – the BMW iX3 electric sport utility vehicle on June 5 – Gerhard hosted a separate session for his staff, a first for the office. The event, attended by around 60 employees, enabled those who might not be directly involved with the product to see and touch the new BMW.

“We are way more than a company that sells and services cars. I want our people to be on that journey. For me, the people is the biggest asset we have”.