COE prices rise sharply across the board
Certificate of entitlement (COE) prices ended higher across the board at the latest tender yesterday on panic buying triggered by the Government's announcement last month to freeze Singapore's vehicle population.
The COE premium for cars up to 1,600cc and 130bhp rose 13.2 per cent to close at a six-month high of $47,112.The COE price for cars above 1,600cc or 130bhp ended 14.8 per cent higher to hit a 15-month high of $57,414.
The premium for open COEs, which can be used for any vehicle type except motorcycles but ends up mostly for bigger cars, rose by 9.6 per cent to close at $57,000 - also a 15-month high.
The commercial vehicle COE price shot up by 11.8 per cent to end at $58,036 - yesterday's highest premium, and the highest for the category since April 2015.
The motorcycle premium raced to a three-month high of $5,502, a rise of 12.2 per cent from three weeks ago.
Motor traders point to fears of higher premiums from next year, when the COE supply is likely to be even smaller on account of the Land Transport Authority's decision to institute zero growth to Singapore's already shrinking vehicle population.
Mr Nicholas Wong, general manager of Honda agent Kah Motor, said zero growth stood out as a reason for the spike as it had a "psychological effect" on consumers.
He said a three-week gap from the last tender - instead of the usual two - had contributed to a larger order book too, as did Singapore Press Holdings' Cars @ Expo bazaar two weekends ago.
He added that dealers rushing to register cars before January contributed to the spike as well. By Jan 1, a new vehicle emissions scheme will go into effect.
Many existing car models will no longer qualify for tax breaks, while others will face tax surcharges.
On top of that, "the Government chose to announce the zero growth now... This created panic", Mr Wong noted.