SINGAPORE - Industry players are painting a gloomy picture in the wake of Certificate of Entitlement (COE) premiums for motorcycles hitting yet another high on Wednesday (Jan 6).
Motorbike premiums climbed to $6,889 - up from $6,600 at the last tender - to surpass the previous record of $6,801 set last April.
There were just 686 bike registrations for the month of December 2015. This takes the year's registration figure to a new low of 7,423, compared to 2014's 8,172. In comparison, the highest number of new registrations since 2005 was 2013's 11,671.
The average of about 618 registrations a month in 2015 is a 36 per cent decrease compared to 2013, says Singapore Motor Cycle Trade Association (SMCTA) vice-president Lee Kwan Meng.
"Back in 2013, we had a monthly average of close to 1,000 new bikes going on the road," said Mr Lee, 46.
"Now, there is simply not enough supply of COEs to meet the demand and it has affected the entire industry negatively."
The motorcycle quota has been drained over the years as 10 per cent of deregistrations go to the open category.
But the premium for open category COEs has proven prohibitive for motorcycle buyers. It closed at $57,501 after Wednesday's bidding exercise.
"We end up contributing to the car population instead as buyers get priced out," Mr Lee lamented. "Ironically, a large number of those looking to buy a bike genuinely need to do so for their livelihood."
Motorcycle dealers The Straits Times spoke to said it was unlikely that prices would soften in the foreseeable future unless the Land Transport Authority (LTA) took drastic action.
Mr Eugene Mah, who runs dealership Mah, said an "unlikely but immediate" recovery would be the return of more than 3,600 bike COEs that were distributed to the other categories back in the 1990s.
"The allowed population growth for motorcycle COEs has to be looked into and adjusted. Motorcycle growth has been marginal over the past decade compared to the other categories," he said.
According to the latest LTA figures, the motorcycle population as of November 2015 had fallen to 143,934, from 145,026 in 2014. This means that the population has grown less than 6 per cent since 2004.
In comparison, the car population, which stood at 616,609 in 2014, has grown almost 48 per cent in the past decade.
Mr Wilson Phoon, director of leading dealer A.S. Phoon, said more customers are turning to used bikes as an alternative as new ones are "out of their reach".
A brand-new class 2B bike (under 200cc) costs about $2,000 to $3,000.
Mr Phoon added: "When buyers are made to fork out more than twice the price of a lower cc bike for COE, you have to ask if the system is working.
"The whole motorcycle industry is shrinking and it is unhealthy for both the sellers and the buyers."
Videographer Steven Chia, who paid less than $2,000 for a COE when he bought his 600cc Honda CBR in 2012, is shelving plans for an upgrade any time soon.
"It's ridiculous. Prices have increased three-fold - even our salaries don't go up that fast."