Certificate of entitlement (COE) premiums ended lower for cars but higher for commercial vehicles and motorcycles in the latest tender yesterday - the first of a smaller August-October quota.
The COE price for cars up to 1,600cc and 130bhp closed 3.9 per cent lower at $45,189. The premium for cars above 1,600cc or 130bhp finished 5.9 per cent lower at $56,001.
The premium for the Open COE, which can be used for any vehicle type except motorcycles but which ends up almost exclusively for bigger cars, ended 0.7 per cent lower at $59,599.
On the other hand, the commercial vehicle COE premium finished 7.8 per cent higher at $42,589. The motorbike premium climbed 2.4 per cent higher to close at a new high of $8,899.
The supply of both these COEs has shrunk by more than a quarter in the August-October period.
In contrast, the supply of car COEs (including Open) is merely 6.6 per cent smaller.
Together with depressed consumer sentiment in the light of Covid-19 restrictions, demand for car COEs is likely to remain relatively subdued. Mr Nicholas Wong, general manager of Honda agent Kah Motor, said: "This shows there is weakness in the market. Despite the drop in supply, prices fell."
He said the weak demand for cars had largely to do with the "protracted heightened alert" - referring to the tightened Covid-19 curbs which are in place till Aug 18.
The Open category, however, reflected a future position, he added. "Traders see that demand is low this round, and so expect demand to pick up," he explained. "There is a speculative element in Open."
Inchcape Greater China and Singapore chief executive Jasmmine Wong, who oversees the distribution of Toyota, Lexus and Suzuki brands, said: "Generally, new orders have been very weak. A lot of customers are waiting on the sidelines for the COE price to drop."