SINGAPORE - Certificate of entitlement (COE) premiums ended higher in the latest tender exercise that closed on Thursday (May 19), except for smaller cars.
The COE premium for smaller cars with engines up to 1,600cc and 130bhp, or electric vehicles (EVs) with a power output of up to 110 kilowatts, dipped by 4.1 per cent from $70,901 to $68,001.
For larger and more powerful cars above 1,600cc, the COE premium rose by 4.1 per cent from $92,090 to $95,889.
The price of commercial vehicle COE went up by 1.2 per cent from $50,890 to $51,501.
The motorcycle COE premium ended at $9,490, a single dollar up from the last tender exercise.
The premium for the Open category COE, which tends to be used for larger cars, ended at $95,901, a 5.3 per cent rise from last round's $91,112.
The latest results for the car categories were largely within the expectations of the industry.
Lower-powered EVs were moved into the COE category for smaller and less powerful cars for the first time at the last tender exercise on May 6.
Some dealers suggested that companies with pre-orders for such EVs had rushed in at the last exercise to secure COEs so they could deliver the cars to buyers.
This goes some way to explain the lower premium in this category at the latest exercise.
Mr Ng Choon Wee, commercial director at Komoco Motors, which distributes Hyundai vehicles, said the latest bidding in the category was reflective of the real demand.
“The car market is still generally weak, but there is strong interest in the smaller EVs,” he said.
He said that after the backlog of earlier bookings was cleared, current orders for Hyundai EV models are in “the low 10s”, and the company managed to secure the needed COEs at the latest tender.
As for the other two car categories, motor dealers said the rising premiums were expected as there are fewer COEs available from May to July than in the previous three months.
The rising COE prices for larger cars frustrated one company representative, who said: “Showroom traffic was not great over these past two weekends, and the COE premium still went up.”
The next COE tender exercise is three weeks away instead of the usual two.
Motor traders believe the longer gap has also contributed to the higher premium for Open category COEs.
As such COEs can be transferred, dealers want to have them on hand to be able to register cars instead of having to wait for the next tender exercise.
“The next tender exercise in June will show the health of the car market. If premiums fall after the additional week between the tenders, then we will know that demand is really, really weak,” said Mr Ng.