SINGAPORE - Certificate of entitlement (COE) prices rose in all categories except for smaller cars on Wednesday, with the premium for larger and more powerful cars notching a new record high for the second consecutive time.
The only category of COE to fall was the one for cars with engines up to 1,600cc and 130bhp, as well as fully electric vehicles (EVs) with up to 110 kilowatts of power. Premiums fell from $87,889 to $86,000, a decrease of 2.1 per cent.
In the category for larger and more powerful cars and EVs, the COE price increased by 0.9 per cent from the previous record of $112,001 to hit $113,000.
Commercial vehicle COE price also rose. It ended at $64,989 - up 10 per cent, from $59,090. This was the biggest mover among the categories.
Motorcycle COE premiums increased by 1.8 per cent, from $11,101 to $11,301.
Prices for the Open COE, which can be used to register any type of vehicle other than motorcycles, went up from $112,001 to $113,299, a rise of 1.2 per cent.
There were 112 fewer bids received for the category of COEs for smaller cars than in the earlier tender. The premium also moved slower than in the previous exercise, remaining at $1 until the final seven minutes to the close of the latest tender exercise.
Some industry watchers suggest that the COE price for this category may be near the limit of what the market can take.
Compared with prices in January, when the premium was $57,599, the COE price for small cars has risen by 49.3 per cent.
Mr Raymond Tang, honorary secretary of the Singapore Vehicle Traders Association and a director at Yong Lee Seng Motor, said: “Buyers have to accept that COE prices are not going to come down any time soon. They can either stop waiting and buy a new car now, or consider cheaper used options, even COE-renewed cars, to suit their budget.”
Mr Jeremy Soh, director of Otopac Motors, which also deals in vehicle financing, said dealers may be less hungry for COEs during this round because they have already secured sufficient Open COEs earlier in preparation for the large-scale motor trade event Cars@Expo, which was held last month.
Mr Tang said recent reports of how rebates to encourage the adoption of cleaner commercial vehicles are likely to be reduced after next March would have had an effect on bidding behaviour.
Dealers would want to have the COEs ready to register the commercial vehicles ahead of the deadline to qualify for the generous rebates.
Under proposed changes by the National Environment Agency, an electric commercial vehicle that currently qualifies for the maximum rebate tier could net $20,000 less in rebates.
There were just 85 such COEs available at the latest tender.
Commercial vehicle COEs are used to register a wide variety of vehicles, including vans, heavy-duty trucks and buses.
Ms Vynn Tu, general manager for Renault at Wearnes Automotive, said that with so few COEs contested by so many users, a bulk order can have significant impact on premiums.
She also said traders are expecting shipments of commercial vehicles to arrive between September and October after delays caused by lockdowns in China and the global shortage of semiconductors. Dealers will be motivated to secure the COEs to deliver the orders, she added.
“Businesses cannot afford to wait for their vehicles. They want these trucks to be on the road as soon as possible,” she said.