COE prices end mostly lower despite smaller quota

[SINGAPORE] Certificates of entitlement (COE) ended mostly lower in the latest tender on Wednesday as two previous spikes sent potential buyers to the sidelines.

COE for cars up to 1,600cc or 130bhp finished at S$48,002, down from S$49,640 two weeks ago. COE for cars above 1,600cc or 130bhp closed at S$60,001, down from S$61,190.

Open COE, which can be used for any vehicle type except motorcycles but which ends up mostly for bigger cars, ended at S$63,002, up from S$62,100.

Commercial vehicle COE finished at S$43,001, down from S$44,001. Motorcycle premium closed at S$8,011, up from S$8,000.

Unlike the other categories which have smaller COE supplies from this month to July, the motorcycle category has a bigger supply. Market watchers reckon its rise despite the supply growth points to strong demand among delivery operators.

Many who have been displaced in industries directly affected by the Covid-19 pandemic have turned to delivery services. Fears of another lockdown - which usually sends deliveries soaring - could also have fuelled the demand for motorbike COEs.

The downward correction in most of the other categories was expected. Usually, the market reacts to a supply shrinkage ahead of the actual contraction. The rise in Open COE on the other hand points to speculation that premiums will rebound within this current three-month quota period.

THE STRAITS TIMES

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