Cat A COE climbs to $126,009, narrowing gap with Cat B to $980

SINGAPORE – The price of a Category A certificate of entitlement (COE) increased by 1.4 per cent on June 4 to $126,009, while the price for a COE in Category B dipped 1.9 per cent to $126,989.

This means there is only a $980 difference between the premiums for categories A and B.

The premium for Category A – for smaller, less powerful cars and electric vehicles (EVs) – was $124,229 at the last tender on May 20, while Category B – for larger, more powerful cars and EVs – was at $129,501.

For the Open category (Category E), the premium fell 0.8 per cent, from $130,000 to $129,000. Certificates in this category can be used to register any vehicle type except motorcycles, but are typically used for bigger cars.

As these certificates are transferable, motor traders often secure them for the flexibility to register cars without waiting for the next tender exercise.

The price of a motorcycle COE (Category D) registered the biggest increase, rising 3.2 per cent, from $9,689 to $10,000.

The commercial vehicle (Category C) COE also registered an increase, with the premium climbing to an all-time high of $94,000, surpassing the previous record of $92,223 set at the last tender.

In a statement issued shortly after the exercise, the Land Transport Authority (LTA) noted that COE prices have remained high, including for commercial vehicles.

It said this reflects sustained demand, including from the recent Car Expo.

For commercial vehicles, LTA noted that registrations of electric heavy goods vehicles and electric buses have picked up since January. This could be due to growing adoption of the Heavy Vehicle Zero Emissions Scheme, it added.

The scheme provides businesses with a $40,000 cash grant for adopting zero-tailpipe-emission heavy goods vehicles and buses.

“We urge buyers and dealers to be prudent in bidding for COEs,” LTA said.

Corinne Chua, managing director of Volvo at distributor Wearnes Automotive, noted that the number of unsuccessful bids was high in the last bidding exercise due to the Car Expo.

For Category B cars, she said some demand may have been registered under the Open category instead, resulting in fewer bids for Category B and therefore easing prices.

For Category A, however, the number of unsuccessful bids remains high after the Car Expo. This has pushed premiums up, leading to a renewed convergence in prices between Categories A and B, she said.

“With the upcoming three-week break after the second bidding exercise this month, I expect prices to remain at current levels or might even go up with an additional week of sales,” added Chua.

Chong Kah Wei, managing director at Eurokars Auto, said the convergence between Category A and Category B premiums is largely driven by strong order volumes for mass-market Category A cars, which is pushing prices closer together.

He said the demand in Category A, driven by the number of models being introduced into the market, will continue to keep the gap narrower than in the past.