Cat A COE supply to dip for May to July period; overall quota up 1.2%

SINGAPORE – The number of certificates of entitlement (COEs) available for the three months from May to July will rise to 19,052.

This is 1.2 per cent more than the 18,824 certificates available from February to April.

The Land Transport Authority (LTA) announced on April 24 that 7,434 Category A COEs will be available for bidding between May and July.

This is a 2 per cent drop from the 7,585 Category A certificates available between February and April, and translates to about 25 fewer certificates in the category for each of the upcoming tender exercises during the quota period.

Category A certificates are meant for smaller and less powerful cars and electric vehicles (EVs).

COEs give people the right to own a vehicle here, and tender exercises are conducted twice a month.

For Category B certificates, meant for larger and more powerful cars and EVs, the supply will rise by 7 per cent for the next three months, from the current 4,864 to 5,205 certificates.

The Open category (Category E) COE supply will increase by 6.3 per cent, from the current 1,435 to 1,526 certificates.

While Open category COEs can be used to register any vehicle type other than motorcycles, dealers typically consider these certificates as part of the overall supply for larger, costlier cars.

Taken together, the supply of Category B and E COEs will increase by 6.9 per cent. This brings the number of COEs available for each tender to 72 more than in the current quota period.

For the May to July period, there will be 1,742 commercial vehicle (Category C) COEs available for bidding, unchanged from the February to April period.

There will be 3,145 motorcycle (Category D) COEs, down 1.7 per cent from 3,198 in the current period.

The COE supply in a given three-month period is mainly determined by the rolling average number of deregistrations in the previous four quarters.

LTA has made several moves that have impacted the COE supply in recent years. From May 2023, to tackle supply troughs, some COEs due to expire in the next projected supply peak were brought forward for redistribution.

When vehicles registered with certificates that were brought forward are eventually deregistered, the COEs will not be returned to the pool for bidding.

From February 2025, LTA also started injecting additional COEs across the vehicle categories. Under this initiative, up to 20,000 COEs will be added to the overall supply over the next few years.

For the May to July period, 1,119 of the 7,434 Category A certificates were redistributed from those due to expire in peak years, as well as from the injections. This is fewer than the 1,822 such certificates for the February to April period.

For the upcoming period, Category B did not get any redistributed COEs. In the previous period, there were 35 such certificates.

The latest COE supply announcement came two days after the latest tender on April 22, when the Category A premium climbed to $123,010, exceeding the Category B price of $121,001.

It was the second time in two months that COEs for mass-market cars cost more than those for premium cars. The last instance was at the tender exercise on Feb 20.

Experts attributed the high Category A price to the popularity of EVs that fall in this COE bracket.

In March, Acting Transport Minister Jeffrey Siow said during the debate on his ministry’s budget that LTA would look into improving the categorisation of cars in the COE system and gather views from motorists, dealers, car manufacturers and academics.

Mr Nicholas Wong, chief executive of Honda agent Kah Motor, said the latest announcement will not mitigate the current high COE prices, especially for Category A, which is overcrowded with EV models that have pushed up demand.

Included in the latest COE supply are 105 Category A and 61 Category B certificates that were secured earlier but expired between January and March before being used to register cars.

This is up from 18 expired Category A and 14 expired Category B COEs that went into the supply for the February to April period.

Motor dealers said the increase in unused certificates likely came from the October 2025 tender, where the Category A COE hit a record $128,105 and Category B COE reached $141,000.

As premiums in subsequent tenders dropped by a larger extent than the $10,000 bid deposit, bidders found it made sense to forfeit their deposits and let the COEs lapse, they said.

Mr Ernest Tan, deputy chief executive of dealership Vincar, noted that vehicle-leasing companies, rather than private car buyers, likely drove up these forfeitures.

Unlike private buyers, whose cars will be registered as soon as the COEs are secured, leasing firms have more flexibility.

Mr Tan added that there has been talk in the market that leasing firms are facing a credit squeeze in recent months, which limits their ability to register cars.

This comes as lenders tightened financing after the collapse of leasing company Autobahn Rent A Car, which owes its creditors more than $300 million, mostly in car loans.

Ms Corinne Chua, managing director of Swedish brand Volvo at distributor Wearnes Automotive, expects the Category A premium to stay high.

She noted that high premiums have pushed some dealers to use Open category certificates to register smaller cars and EVs.

On April 22, the Open category COE premium was $125,002.

This means the gap between a Category A and an Open category certificate has shrunk to $1,992, compared with $20,780 in April 2023.