The latest Certificate of Entitlement (COE) tender on Wednesday (19th August) saw an increment for all COE prices across the board. This is the 4th round of COE bids since bidding exercises resumed in July.
(Related Story: COE Bidding Results: August Analysis (First Tender))
Category A closed at $35,710, which is a $2710 increase over the previous round with 2,099 bids received.
Category B closed at $38,802, with an increase of $1700 over the previous round with 1,727 bids received.
Category C closed at $25,006, with an increase of $906 over the previous round, with 586 bids received.
Category E closed at $38,110, which is $1,608 higher than the previous round, with a total of 764 bids received.
Just like with the previous bidding exercise, the COE prices have increased across all categories with the exception of motorcycles. The prices for category A, B, and E COE premiums saw significant increases, hitting an all-time high across all bids in 2020. However, there were a lower number of submitted bids compared to the first tender in August.
This may be largely due to the lower number of COE quotas available for bid. This ties in with LTA’s announcement that the vehicle population in Singapore will be capped until January 2022, with 0% growth for cars and 0.25% growth for commercial and goods vehicles. However, the number of quotas available are still contingent on the number of vehicle de-registrations.
FUTURE COE PREDICTIONS
With this being the 4th round of bidding since the COVID-19 measures were lifted, industry experts were already anticipating the current COE price increases. And they fully expect it to continue rising. But the question is, how high will it go?
“Based on the recent COE trends, the increase in prices were expected. The way I see it, the rising prices reflects the demands of Singaporeans. Even during this post-pandemic period, it wouldn’t affect the vehicle market drastically. So we should expect to see these sorts of prices in future bidding exercises,” explained Nicholas Peters, Founder of StarShine Inc.
Additionally, some industry experts feel that the demand of cars will always be higher than the supply. Therefore, it explains the ever increasing COE prices.
“The COE system is uniquely Singaporean, created to control and regulate the population of cars. External factors such as COVID-19 shouldn’t have any effect on the COE prices because since the inception of the COE system, the demand curve is perpetually above the supply curve. The demand for COEs would still be strong. But it all depends on the distributors’ and Parallel importers’ marketing approach to sell more cars. If they want to cut more cars to cut the margin, they should employ more aggressive marketing tactics. Dealers who want to clear their stocks should package and bundle their new cars more attractively.” added Albert Neo, Director of UCARS
BUYING A CAR WITH UCARS
It’s a given fact that times are uncertain, with COE prices on the rise. We here at UCARS feel that now more than ever is your chance to buy a new car before the prices increase any further. So what are you waiting for? Visit our website to check out our listings today!