Motor Mouth

Should I buy a new car now?

What next, as one's car's COE expiry looms - extend the certificate, buy a new car or give up car ownership altogether?

I feel like a tenant who is about to be evicted, a contract worker whose project is about to be completed, a wedding guest sticking around for one last drink.

You see, my car's COE will expire in three weeks. And I still have not made up my mind what to do next.

Should I subscribe to the economist's view - one which I have often expounded in my columns - and revalidate the certificate of entitlement?

It is a money-wise option. A new replacement for my trusty Toyota Wish is twice the price I paid a decade ago. The annual depreciation would be more than $10,000.

To extend my current car for another 10 years, I would forgo the Parf (scrap rebate), fork out $60,000 or less for the COE prevailing quota premium and replace some worn-out parts.

I would, however, have to pay higher annual road tax and insurance premium for an older car and be subject to more regular vehicle inspections (take a moment here to appreciate the irony of these policies).

In spite of all that, the depreciation of my old car would work out to less than $8,000 a year.

The car drives as well as it did on its first day, except for higher noise and vibration, which can be fixed easily by changing some minor parts.

The fact that I will soon have two new drivers in the family makes this option more attractive. The dings and dents which new drivers are bound to accrue will not hurt as badly as on a brand new car.

Another thing. Scrap car dealers are quoting ridiculous prices. The best I got was $800. For a car that is as sound and as highly equipped as mine, $800 is an insult.

Or should I disregard the economist's view and live a little? After all, life should not be measured merely by dollars and cents, right? And as we approach the Yuletide season, I'm reminded once again not to be a scrooge.

How about an Audi Q7? It is the family's favourite test-car. The 2-litre variant is available and it is "merely" $300,000 or so.

If we cut down on dining out, it should be doable without digging into the children's college fund. Much.

It is, of course, a frivolous option. But you only live once. And on that score, I deserve a break, having been fairly frugal all my life.

Incidentally, the new Mazda MX-5 is delectable. I might downgrade to a beat-up old hatch and then splurge on the MX-5 as a second car.

The two combined would likely cost less than the Audi Q7 2.0.

Heck, even if I went out and bought a new Toyota Wish and a new MX-5, the sum total would be less than the list price of the Audi.

Maybe I should do that - before getting in and out of a low-slung convertible becomes a pilates manoeuvre.

Also, this would be the last chance I get to enjoy my company's car loan. The kiasu Singaporean in me says I should not pass this up.

And that's the other thing. If I revalidate the COE of my car, I would have to pay cash. Tying up so much cash when the economy looks set to slide is not wise. You should stay as liquid as possible to take advantage of opportunities that come along.

But that's just idle talk. In all the past downturns, I have been either too dumb or too chicken to seize anything. I have always been the guy who says "it'll go down further".

As far as COE prices go, I've been pretty spot on in the last couple of decades. In this current cycle, premiums have fallen from about $95,000 nearly three years ago to around $60,000 today.

They will continue to trend downwards in the next two to three years. Alas, I cannot wait. I have to decide soon.

But what about giving up owning a car? That is not as far-fetched a notion as it sounds. I live within walking distance of two MRT stations and one integrated transport hub. The only thing missing is access to a park connector - but hey, two out of three ain't bad.

The truth is, I am not ready to give up car ownership. I still treasure the freedom, independence, privacy and comfort that a car affords.

Public transport, as efficient as it is, cannot match a car on those fronts.

But I also admit that humans are adaptable. If we are no longer able to criss-cross the island with speed and convenience, we will eventually learn not to miss doing so. We will learn to live, work and play within a smaller area.

And I think I will be ready to do precisely that. Just not yet.

A version of this article appeared in the print edition of The Straits Times on December 12, 2015, with the headline 'MotorMouth Should I buy a new car now?'. Print Edition | Subscribe