Large car COE premium spikes 13% as mainstream car category cools
Buyers choose large cars due to narrowed gap between Category A and B premiums in previous round, say industry observers
[SINGAPORE] Certificate of Entitlement (COE) premiums for November’s second round of bidding were mixed: the premium for large cars spiked 12.9 per cent, and that of mainstream cars dipped by 0.9 per cent.
Industry observers said the narrowed gap between the premiums of the two categories in the previous round overwhelmingly made buyers go for Category B models, thus driving up the premium in this round of bidding.
Anthony Teo, managing director of BYD distributor and dealer Vantage Automotive, noted that the gap between the two categories narrowed greatly in November’s first round of bidding.
“With Category A and B so close in price, it meant buyers mostly opted for Category B models this time, so the premium went up much more than expected. We thought Category B would increase by S$5,000 to S$7,000, but it was almost double that in the end,” he added.
Category B’s 12.9 per cent rise took the premium S$14,889 higher, to S$129,890.
This category is used to register larger, more powerful cars that have engines of more than 1,600 cubic centimetres (cc) in capacity or with more than 97 kilowatts (kW) of power, or for electric vehicles (EVs) with more than 110 kW of power.
In Category A for mainstream cars, the premium was S$109,000, a dip of 0.9 per cent or S$1,002.
Category A COEs are for cars with engines of up to 1,600 cc in capacity or up to 97 kW of power, or for EVs with up to 110 kW of power.
The three remaining categories all posted slight increases.
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Category C, for commercial vehicles and buses, ticked upward 0.5 per cent or S$389 to S$76,389.
Category D, used for motorcycles, was up 1.5 per cent or S$129 to S$8,729.
Category E, the open category which can be used to register any type of motor vehicle except for motorcycles, went up 3.3 per cent or S$3,991 to S$125,001.
Category B-oom
Industry players agreed that the unusually small gap between the mainstream and large-car categories in the previous round of bidding had pushed buyers towards models from the latter category.
The difference between the two categories typically ranges between S$15,000 and S$20,000, as has been the case for most of 2025.
But in November’s first round of COE bidding, it shrank to just S$4,999. The next closest gap between the two in recent times was S$9,010, in December 2024’s first round of bidding.
Jason Lim, the managing director of Eurokars Auto, a dealer for BMW, said that as the price difference between categories A and B narrowed, both consumers and dealers focused on Category B.
“Consumers want more bang for their buck, always. If the gap is below S$10,000, they would just switch to Category B cars. Overall, in terms of the whole price, it isn’t a lot more,” he said.
Cars in Category B are typically larger, more powerful, and have more features and equipment onboard.
Because car prices are based on the previous round’s COE results, it meant that, in many cases, buyers would – at first glance – have needed to pay under S$10,000 more to go for a more powerful car.
Dealers pointed out that market leader BYD’s most popular model – the Sealion 7 sport utility vehicle (SUV) – could have been a major factor in the Category B increase, because this model has versions in both categories.
The price difference for Sealion 7 models was S$6,000, with the Category A model at S$208,388 and the Category B one at S$214,388, both prices inclusive of COE. In early September, the price difference was S$19,000.
The Category B model has a larger battery, increased range and more than twice the horsepower of the Category A model.
Likewise, the Zeekr X, a small electric SUV, had a price difference of S$5,000 between the Category A and B models before the latest results, even though the Category B model is almost twice as powerful.
But in the latest results, the focus on Category B was enough to propel the difference between the categories back to its typical gap, at S$20,980. Dealers say the next round should see a return to normal.
“Now the gap is back at around S$20,000, the focus should swing back to Category A in the next round,” said Lim.
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