Cat A COE price falls 9.8% to $110,002 as premiums drop across the board
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Motor dealers said buyers are waiting for COE premiums to fall further before committing to a purchase.
ST PHOTO: NG SOR LUAN
- COE premiums in Singapore decreased across all categories in the latest tender, marking the second consecutive decline, with Category A at $110,002.
- Despite lower COE prices after the previous tender, showroom traffic hasn't significantly increased, as consumers anticipate further drops before making car purchase commitment.
- LTA advised prudence in COE bidding. Dealers expect moderate sales increase but some buyers may delay purchases.
AI generated
SINGAPORE – Certificate of entitlement (COE) premiums came down across the board on Nov 5, with the price of certificates for smaller cars falling to $110,002 and that for larger cars to $115,001.
This is the second consecutive tender exercise where premiums for COEs used to register cars fell.
Category A COEs, meant for smaller and less powerful cars and electric vehicles (EVs), dropped to $110,002 – 9.8 per cent lower than the $122,000 at the previous exercise.
The price of Category A COEs has been edging up since the first tender exercise in June, hitting a record of $128,105 at October’s first tender
At $115,001, the price of a Category B COE – for larger and more powerful cars and EVs – was 12.8 per cent lower than the $131,889 at the last exercise on Oct 23
Car dealers said showroom traffic did not pick up as much as they had hoped since the dip in COE premiums at the previous round. Some said sales promotions at various shopping malls over the past two weeks have not been effective in bringing in more business, as consumers are holding out for COE premiums to fall further before committing to a purchase.
The Open category (Category E) premium fell by 11 per cent from $136,000 to $121,010. Open category certificates can be used to register any vehicle type except motorcycles, but end up mostly for bigger cars.
As such certificates are transferrable, they give motor dealers the flexibility to register cars without having to wait for the next tender exercise.
At $76,000, the commercial vehicle (Category C) COE rate was 1 per cent lower than the $76,801 two weeks ago.
The COE premium for motorcycles (Category D) fell 8.4 per cent from $9,389 to $8,600.
After the close of the tender, the Land Transport Authority (LTA) noted the drop in premiums, and advised car buyers and dealers to continue to be prudent in bidding for COEs.
Reflecting softer sales over the past two weeks, 4,167 bids were submitted at the latest tender across the COE categories, down from 4,384 at the previous exercise.
There were 987 unsuccessful bids across the categories, down from 1,258 at the Oct 23 exercise and 2,181 bids on Oct 8. Those who failed to secure a COE are expected to return in subsequent exercises.
Some 257 bids for Category A COEs – or 15.3 per cent of the total for such certificates – were entered in the last five minutes of the exercise, when the premium was slightly more than $100,000.
Some motor dealers believe some of these late bids may have come from leasing companies seeking to secure COEs at a lower price.
With the latest tender results, a Category A COE is priced $4,999 below a Category B one. This is the narrowest price gap between the two categories since November 2024, when the Category B premium was $8,112 higher than Category A’s.
Mr Nicholas Wong, chief executive of Honda agent Kah Motor, said demand for Category A COEs has been rising with the influx of EVs that qualify for this category.
Dealers said they had expected premiums to drop, given the quiet showrooms, though the scale of the decline took some by surprise.
The dealers offer COE rebates, the level of which is typically reflected in their car price lists. If the COE that is eventually obtained costs less than the predetermined level, buyers receive a refund of the difference.
Based on published price lists after the Oct 23 exercise, Nissan, for example, had set the rebate level for Category A COE cars at between $114,000 and $119,000, depending on whether the deal is for a guaranteed or non-guaranteed COE. Buyers under such terms will now receive refunds, as the latest premium at this tender was lower than that level.
At Volvo, the rebate level for a Category B COE was $120,000. Hence, those who bought Category B cars will get $4,999 in rebates, as the actual premium stood at $115,001.
Dealers said sales did not pick up after COE prices decreased at the last exercise. Some, like Ms Corinne Chua, managing director of Volvo at distributor Wearnes Automotive, saw this as an indication that buyers could have been expecting prices to dip further.
Still, Mr Jason Lim, managing director of Eurokars Auto BMW, expects the lower car prices after the latest tender to spark some buying interest.
Mr Ng Choon Wee, commercial director of Hyundai distributor Komoco Motors, said the COE premiums are still high, so some buyers will continue to stay away.
