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COE premiums up across the board; Cat C sees largest jump
CERTIFICATE of entitlement (COE) premiums went up across the board in the latest round of bidding, with goods vehicles and buses registering the biggest increase.
The premium for goods vehicles and buses (Category C) increased by S$3,889 from S$45,001 in February's second bidding exercise to S$48,890 on Wednesday.
The COE for Category A (cars up to 1,600cc and 130bhp) rose from S$43,000 to S$45,000, while the premium for cars above 1,600cc (Category B) edged up from S$46,970 to S$47,604.
This was the second consecutive increase for Category B after it slumped to S$38,610 in February's first bidding exercise.
According to Ron Lim, general manager of Tan Chong Motor, the increase in Category C is fuelled by post-Chinese New Year demand as companies get back to business.
He went on to add: "The absolute quota is small, so it's easy to push up."
The quota for Category C was 162, while 259 bids were received.
Meanwhile, the COE for the open category increased from S$45,009 to S$48,002, while that for motorcycles was slightly higher, increasing from S$6,353 to S$6,503.
The open category typically tracks Category B, but with just S$888 separating the premium for the open category and that of category C, some consumers might end up opting to use the open category COE for goods vehicles and buses.
Mr Lim, who described the overall increase as "manageable", doesn't expect any huge corrections for Categories A and B premiums in the near-term, given the backlog.
With the slower economy, everyone is aware that they can't push premiums up too high as buyers might hold back purchases, Mr Lim added. "It has a lot to do with the overall economy. As long as that is tepid, no one will rush in."
The Land Transport Authority (LTA) received 7,864 bids at the end of March's first open bidding exercise for COEs, which came three weeks after the last round in February, of which 3,985 were successful.