COE quota up 8.2% to 17,133 for Feb to April, including first injection of additional certificates

SINGAPORE – There will be 1,299 more certificates of entitlement (COEs) available for tender in the February to April period than in the preceding three months, marking an increase of 8.2 per cent.

In all, 17,133 certificates will be available for bidding, the Land Transport Authority (LTA) announced on Jan 16. This is up from the 15,834 COEs that were available for the November 2024 to January 2025 period.

February to April is the first quota period during which LTA is injecting extra COEs, on top of the supply derived in part from deregistrations in 2024 and certificates being brought forward from guaranteed deregistrations in the next projected supply peak.

A COE is needed to register a vehicle for use in Singapore. At present, the main determinant of the number of certificates available for bidding is the number of vehicles taken off the road in the previous four quarters.

In the upcoming quota period, the number of COEs brought forward and the additional certificates injected will add up to 4,201 across the car and motorcycle categories.

When asked for the number of extra COEs injected in this round, LTA told The Straits Times that a breakdown is “less meaningful” because the quota from both sources of COEs – guaranteed deregistrations and injections – goes towards a common pool.

“The quota within this common pool is then used to smoothen COE quota on a quarter by quarter basis, after taking into account the deregistration numbers of the quarter.”

Last October, LTA announced that it will progressively inject up to 20,000 additional COEs over the next few years across the five vehicle categories, starting in February 2025.

It had said it was able to do so because travel patterns have evolved, with the total mileage clocked by vehicles decreasing by around 6 per cent from 2019 to 2023.

The next-generation satellite-based Electronic Road Pricing system will also allow the authorities to manage traffic congestion better, thus leaving room for the vehicle population to be adjusted.

At 6,828, the supply of COEs in Category A, meant for smaller and less powerful cars and electric vehicles (EVs), will be 10.3 per cent more than the 6,190 pieces available in the November 2024 to January 2025 period.

Category B COEs, which are used to register larger and more powerful cars and EVs, will also receive a boost of 10 per cent to 4,465 pieces, from 4,060 in the previous period.

The Open category (Category E) COE supply will rise by 10.7 per cent from 1,072 to 1,187. Although Category E COEs can be used to register any vehicle type except motorcycles, they are almost always used for larger cars and EVs.

The supply of COEs for commercial vehicles (Category C) will be 1,548 – 10 per cent more than the 1,407 pieces available in the preceding period.

The motorcycle COE supply remains unchanged at 3,105.

The Jan 16 announcement came less than a week before the next COE bidding exercise on Jan 22 – the final exercise for the November 2024 to January 2025 quota period.

Industry insiders see the timing of the announcement as a move to prevent COE premiums from surging in the upcoming tender.

This comes as dealers try to secure certificates to deliver the cars they sold during the Singapore Motorshow from Jan 9 to 12.

They do not see the quota announcement as being enough to bring down premiums significantly.

Eight motor dealers interviewed by ST expect it may take the next two or three tenders before all the COEs needed for deals closed in January are secured. Projections on how COE premiums will develop thereafter are mixed.

Mr Anthony Teo, managing director of Vantage Automotive, which distributes the BYD, Peugeot and Ford brands, said premiums may dip in the longer run, since dealers who can afford to wait will not bid as aggressively for COEs.

Instead, they will pace themselves over a longer period with knowledge of the COE supply available until April.

Mr Ng Choon Wee, commercial director of Hyundai distributor Komoco Motors, said COE premiums will stay high because the rise in COE supply is not significant enough to “move the needle”.

Mr Ron Lim, sales and marketing head at Nissan distributor Tan Chong Motor, said: “The market was expecting a lot more injection from the extra 20,000 COEs.”