The Certificate of Entitlement (COE) tender on 4 November 2020 saw a price drop across all categories. Category C saw the largest decrease of 6.97% among other categories in the first tender for November 2020.
(Related Story: Monthly COE Quotas For November 2020 To January 2021)
Category A closed at $35,990, which decreased by $1,344 from the previous round in October 2020 with 1,262 bids received.
Next, Category B closed at $39,000, which decreased by $1,990 from the previous round with 1,415 bids received.
Category C closed at $31,502, seeing a $2,276 decrease from the previous round with 558 bids received.
Lastly, Category E closed at $39,500, with a decrease of $389 from the previous round with 683 bids received.
Following the October 2020 first and second tender, we see a steady overall trend of decreasing COE prices in November 2020. For the first time in two months, Cat C saw a decrease in price, the largest drop for November 2020.
As expected, COE prices for Cat B and Cat E had decreased. What was surprising, however, was the decrease for Cat A despite lowered quotas between November 2020 and January 2021.
We can expect to see slight but continued dips in COE prices for the next few tenders. Given the relatively stable trends, we are currently not anticipating any significant changes in consumer spending habits for automobiles.
FUTURE COE PREDICTIONS
With an increase in COE quotas for all except Cat A, Mr Jason Wong, Founder of Drivezz, had anticipated the drop for Cat B. He thinks that the drop is “within expectations” after the quota increased from 1,729 to 2,014.
Even though Mr. Wong found the decrease for Cat A “unexpected”, he believes that this anomaly can be accounted for.
“Possible reasons are the backlog for new car orders is being gradually fulfilled and the reality of economic uncertainty is slowly sinking into consumers’ mindset,” he explained.
Mr Raymond Tang, Managing Director of Yong Lee Seng Motor, thinks there are other reasons for the drop in prices. He attributes the dip to the increase in COE quota, noting that many consumers were “waiting to see what will happen to the COE prices with the quota increase”. As a result, we see buyers holding off from making purchases in the current cycle.
Mr Tang also explained that the increased COE quotas were likely due to “a delay in cars getting scrapped during the circuit breaker period from April to June”. With more cars suddenly being scrapped between July and October, we see more quotas for new cars being available now.
“The COE supply will fall and the price will rise again next year,” he added in an interview with The Straits Times.
CONCLUSION: COE PRICES FOR 2020
Despite changes in monthly COE quota for the coming months, we can prepare for stable demand till end of 2020. Minimal fluctuations in prices are expected; So if you are looking to buy a car, now may be a good time. Visit our marketplace today to enjoy the best prices available on new and used cars in Singapore!