The second Certificate of Entitlement (COE) tender on 17th February 2021 saw a decrease across all categories. The highest recorded decrease was for Category C by 9.14%, followed by Category E with a 4.56% decrease. The PQP for February 2021 closed at $39,844 for Cat A, $45,586 for Cat B, and $34,471 for Cat C.
COE Bidding Results February 2021 (Second Tender)
(Related Story: COE Bidding Results: February 2021 First Tender Analysis)
Category A closed at $41,001, a $999 decrease from the previous round with 1,226 bids received.
Category B closed at $46,002, which is a decrease of $788 from the previous round with 1,168 bids received.
Category C closed at $40,890, with a decrease of $4,111 from the previous round, with 424 bids received.
Category E closed at $47,506, which is a $2,272 decrease from the previous round, with a total of 503 bids received.
February 2021: COE Second Tender Analysis
COE prices decreased across all categories, a likely result of the dip in COE quota from February 2021. Even though the number of bids received is relatively steady, most bidders were probably expecting prices to either remain or drop. As such, it is likely that bidders are less willing to spend on COE and thus, resulting in a decrease across the board. Furthermore, it is possible that most car dealers have already prepared for their CNY promotions beforehand. This could also account for why bidders are less likely to spend extra on COE.
Future COE Predictions
Several industry experts reflect on the decrease in COE prices in February across all categories.
“There are little backlogs for passenger vehicles as compared to the previous COE bidding rounds before Chinese New Year. I believe that the majority of dealers have already secured most of the COE for their clients before CNY,” said Andy Lin, Associate Director of CarTimes. “As such, I feel that the COE prices for next round should not see too much of a hike, and may even maintain or decrease.”
Mr Lin also added that the Budget 2021 announcement on Tuesday (16 February) might have deterred individuals from getting a car due to increased petrol prices. Hence, he says, there might be a “wait and see approach” on the consumers’ end.
Ken Ng, Director of Majestic Automobile, also echoes similar sentiments that the COE prices for the next bidding exercise are likely to maintain within the current range.
Even though demand has been stable, COE prices have been showing a decreasing trend over the past two rounds. Although initially surprising that COE prices generally declined after a quota dip, it is explained by lots of price speculation. With the on-going speculation, bidders are less willing to spend on COE for fear of sudden spikes in prices. Also, given the push towards EVs, we can expect consumers to reconsider car choices and spending in general. Hence, we can anticipate COE prices remaining relatively stable in the next round of COE bidding.