COE prices up across all categories; Cat A premium rises 5.5% to $118,000

SINGAPORE – The prices of certificates of entitlement (COEs) rose across the board on April 8, with the Category A premium seeing the highest rise of 5.5 per cent to end at $118,000.

The price of the Category A certificate, meant for smaller and less powerful cars and electric vehicles (EVs), was $111,890 at the previous tender on March 18.

The price of a certificate for Category B, for larger, more powerful cars and EVs, went up by 4.7 per cent to $121,000, from $115,568 previously.

This is the third consecutive exercise in which premiums rose across all categories.

In the Open category, otherwise known as Category E, the premium rose 2.4 per cent, from $118,119 to $121,001.

Certificates in this category can be used to register any vehicle type except motorcycles, but are typically used for bigger cars.

As these are transferable, motor traders secure them to have the flexibility to register cars without having to wait for the next tender exercise.

The commercial vehicle COE premium (Category C) rose 2.6 per cent, from $78,000 to $80,001. The COE price for motorcycles (Category D) was $10,000 – a 4.3 per cent hike from $9,589 previously.

Ms Corinne Chua, managing director of Volvo at distributor Wearnes Automotive, said the increases were expected after a three-week break following the last COE exercise.

Roadshows over the long Easter weekend also boosted demand, reflected in a high number of unsuccessful bids in both Categories A and B.

“With (more) unsuccessful bids across both categories, I expect prices to remain at current levels for a while,” Ms Chua added.

Mr Raymond Ng, managing director of Eurokars EV, agreed that the premium increases were largely driven by stronger sales orders collected over the longer three-week break.

He added that the recent rise in petrol prices due to the war in the Middle East, coupled with the announcement in February that the preferential additional registration fee, or PARF, rebate will be lowered by 45 percentage points, has nudged fence-sitters towards EVs over internal combustion engine (ICE) cars.

Chinese EVs, in particular, are dominating the market due to their high specifications and value-for-money pricing, he said.

Ms Chua, however, said Singaporeans are still buying both ICE vehicles and EVs.

Mr Nicholas Wong, chief executive of Honda agent Kah Motor, also said that he has not seen buying sentiment shifting due to the war.

“There should be uncertainty and (a pullback in) purchases, but this bidding exercise shows customers are not holding back,” he said.

Mr Wong noted that premiums for Categories A and B are converging again, with the gap now narrowed to just $3,000.

“The distinction is blurring,” he said, adding that this is pricing many buyers out, particularly those looking at Category A cars. If the two categories are meant to cater to different segments of the market, the rules should be more clearly differentiated, he said.

Acting Transport Minister Jeffrey Siow said on March 4 that the Land Transport Authority (LTA) is reviewing the COE system to improve how cars are categorised.

The move followed concerns raised by MPs after Category A premiums exceeded those of Category B at the second tender exercise in February.

Mr Siow said LTA will consult motorists, dealers, car manufacturers and academics. The review is expected to be completed by the year end.