Certificates of entitlement (COEs) ended mostly lower at the latest tender yesterday, as news of Uber selling unused cars dampened demand for new cars.
COEs for cars up to 1,600cc and 130bhp fell by 2.4 per cent to close at $38,001. COEs for cars above 1,600cc or 130bhp slipped 1.3 per cent to finish at $37,989. Open COEs, which can be used for any vehicle type except motorcycles, bucked the trend by inching 0.3 per cent upwards to close at $38,700.
Commercial vehicle COEs tumbled 9.9 per cent to finish at $29,901 - its lowest in a year. Dealers said this was because of a bigger supply of certificates, as well as unused COEs in recent tenders being ploughed back into the system. Motorcycle premiums, meanwhile, dipped 1.9 per cent to end at $7,115.
Motor traders said that demand continued to be weak despite promotions by dealers to clear the stock of vehicles that will incur higher taxes come July. From July, a new emission ruling is expected to render many models commercially unviable because their prices could spike by as much as $20,000.
Mr Neo Nam Heng, chairman of diversified motor group Prime, said that Uber-owned Lion City Rentals selling off hundreds of its cars could have reduced demand for new cars.
Last week, The Straits Times reported that Uber was selling as many as 400 cars that it has failed to rent out to drivers for as long as a year.
"These cars have flooded the market. And it is causing dealers to be a bit nervous," Mr Neo said, explaining that these cars - most of which are still under warranty - had diverted demand away from new cars.
Mr Raymond Tang, managing director of used-car dealer Yong Lee Seng Motor, said he expects commercial vehicle COEs to rebound.