COE prices down across the board before higher supply kicks in from February

SINGAPORE – Certificate of entitlement (COE) prices dropped across all categories on Jan 22, with the premium for motorcycles recording the biggest decrease of 14.2 per cent to $7,721.

The premiums for larger cars and the Open category also eased from the 13-month highs recorded in the

previous tender exercise on Jan 8.

The Jan 22 exercise is the last for the three-month COE quota period from November 2024 to January.

For the next quota period from February to April, the supply of COEs

will rise by 8.2 per cent.

At $93,601, the premium for a Category A COE – meant for smaller and less powerful cars and electric vehicles (EVs) – dipped 0.1 per cent from $93,699 two weeks ago.

The price of a Category B COE, used to register larger and more powerful cars and EVs, decreased by 4 per cent to $116,625. It was $121,501 in the previous exercise – the highest since December 2023.

The price of an Open (Category E) COE was $115,112. This was 6.4 per cent lower than the $123,000 recorded two weeks ago, which was similarly the highest since December 2023.

Open category certificates can be used to register any vehicle type other than motorcycles, but are almost always used for bigger and more powerful cars.

The commercial vehicle (Category C) COE premium came in at $65,476, 3.6 per cent lower than the $67,891 recorded previously.

The motorcycle (Category D) COE premium tumbled by 14.2 per cent to $7,721, from $9,001 at the previous tender exercise. This is the lowest since May 2023, when the premium was $5,002.

A COE is needed to register a vehicle for use in Singapore. Car prices usually include COEs.

Motor traders said buying interest in larger cars and EVs has cooled after Category B COE premiums surged by $12,501 in the previous round.

This, in turn, also reduced demand for Open category COEs.

The latest tender exercise drew fewer bids than the previous round in January, with the Open category seeing the largest drop of 21.4 per cent, followed by Category B, which posted a decline of 15.4 per cent.

The higher supply of COEs for the February to April period also dampened dealers’ eagerness to secure COEs in this round, industry sources said.

Mr Raymond Ng, managing director of distributor Eurokars EV, said that the chance of the increased COE supply bringing down premiums may be undermined by the higher demand stemming from the Singapore Motorshow that was held in January.

Mr Ernest Tan, director of new ventures at dealership Vincar, said premiums may rebound in the next few rounds, as dealers who can hold out until the new COE quota period will enter the market then.

Other dealers expect COE premiums to hover at the current levels in the next tender exercise.

Motorshow deals tend to be aggressively priced to attract buyers.

Ms Sng Khai Hing, executive director of motor agent Vertex Automobile, said that this limits how much dealers can afford to bid for COEs in the subsequent rounds.

Mr Nicholas Wong, chief executive of Honda agent Kah Motor, said sales will be slow during the Chinese New Year holiday period.

This view was echoed by Mr Melvin Lee, general manager of Harmony Auto Singapore, an authorised BYD dealer, who said that COE premiums tend to dip around this period, based on past records.

Car showrooms typically close for a few days around the Chinese New Year period.

A spokesman for Yew Heng Group, a motorcycle distributor, cited the upcoming holiday closure as a reason for the significant drop in the motorcycle COE premium in the Jan 22 tender exercise. Yew Heng Group’s 12 outlets in Singapore will be closed from Jan 25 to Feb 5.

As secured motorcycle COEs can be held only for a month, the spokesman said dealers do not want to risk holding on to too many COEs, as there is insufficient time to register motorcycles after they reopen.