The certificate of entitlement (COE) for motorcycles is now at $9,500 (COE prices rebound as restrictions to curb pandemic are eased, Aug 19).
In January, then Transport Minister Ong Ye Kung responded to a parliamentary question on plans to re-evaluate the motorcycle COE regime to address the high COE prices.
He said: "We are mindful that many lower-income Singaporeans require a motorcycle to go about their work. That is why the bid deposit is set lower at $200 for Category D COEs. If we raise the $200 bid deposit, this will raise costs for dealers, which may mean higher prices for buyers."
The fact that the bid deposit is set at $200 (approximately 2.1 per cent of the COE value now), as opposed to a pay-what-you-bid amount, is one of the causes of price escalation. The low bid deposit allows the larger players in the industry to bid for COEs without assuming the risk and liability for payment, something that is present in the car COE system.
Another fallout is that with a high COE value that adds to the price of a new motorcycle, it encourages financing of motorcycle purchases, as well as the need to resort to motorcycle leasing (as opposed to ownership), which increases the cost of living for the very low-income people who turn to this cheaper form of transport in the first place.
There are about 20 motorcycle leasing companies.
It is high time the Government looked into the issue and rein in the runaway situation with motorcycle COEs.
Chiok Beng Piow