COE prices rise across all categories except motorcycles; Cat B premium up 3.2% at S$116,670
[SINGAPORE] Certificate of Entitlement (COE) prices rose across the board, except for motorcycles, in the latest exercise on Wednesday (Jun 18).
The price of a Category B COE – meant for larger and more powerful cars and electric vehicles (EVs) – rose by 3.2 per cent to S$116,670, from S$113,000 recorded at the previous tender on Jun 4.
In Category A, meant for smaller and less powerful cars and EVs, the premium was S$98,124, an increase of 1.2 per cent from S$96,999 at the last exercise.
The COE prices for cars crept up after two consecutive rounds of declines.
The price of an open category (Category E) COE was S$116,889 – 2.6 per cent higher than the S$113,900 at the previous exercise. Although open category COEs can be used to register any vehicle type other than motorcycles, they are almost always used for bigger and more powerful cars.
The commercial vehicle (Category C) COE premium was S$65,000, climbing 4.8 per cent from S$62,000 in the previous exercise.
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The motorcycle (Category D) COE premium bucked the trend, falling 4.4 per cent from S$9,000 to S$8,600.
COEs give people the right to own and use a vehicle in Singapore, and these certificates are usually included in the price of the vehicle.
Overall, 4,207 bids were received across all categories – 4 per cent higher than two weeks ago.
Motor dealers told The Straits Times that they expected COE premiums for cars to increase in the latest exercise, given that prices dropped in the past two rounds.
Ng Choon Wee, commercial director of Komoco Motors, which distributes Hyundai, said potential car buyers may have taken the opportunity to make their purchases at a time when COE premiums were slightly lower than those of preceding tenders.
Some brands also held roadshows after COE prices dipped in the last round, and secured a substantial number of orders, he added.
Corinne Chua, managing director of Volvo at Wearnes Automotive, also observed higher showroom traffic over the past two weeks after COE premiums dropped, adding that interest levels were “not too bad”.
But Nicholas Wong, chief executive of Honda agent Kah Motor, is of the view that the increase in premiums for Category A is largely due to motor dealers’ desperation to put cars on the road – either from fulfilling a backlog of orders or securing COEs in advance.
This is because prices for Category A COEs rose even though the number of bids received for Category A remained almost the same – at 1,647 bids, compared with 1,691 bids in the Jun 4 exercise.
Wong said this suggested that the pressure on pricing was too high, even in a weak market where the number of bids did not increase significantly.
Looking ahead, Ng said it is likely that premiums will continue to trend upwards in the next exercise.
He predicted that Category B prices may go up to S$120,000 in the next exercise, as the 382 excess bids for Category B in this tender were more than double that in the previous exercise.
Noting that Category A premiums in May’s bidding exercises closed at S$103,009 and S$102,501, he said he expects prices to climb past the S$100,000 mark, as there is a longer three-week gap till the next tender on Jul 9.
Wong, however, said the results in the next exercise would still depend on the aggressiveness of motor dealers, and he anticipates softer demand – and hence lower premiums – due to the school holidays. THE STRAITS TIMES
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