Channel NewsAsia
Updated: 04/11/2014 10:47 | By Channel NewsAsia

12,060 COEs for May to July, monthly quota up 32%

12,060 COEs for May to July, monthly quota up 32%

12,060 COEs for May to July, monthly quota up 32%

SINGAPORE: There will be 12,060 Certificates of Entitlement (COEs) for May to July 2014, said the Land Transport Authority (LTA).

A monthly quota of 4,019 has been set aside -- a 32 per cent increase compared to the last three months of February to April 2014.

The increase is mainly due to more cars being scrapped this year.

However, Professor Lee Der Horng from the department of civil and environmental engineering at the National University of Singapore, said that COE prices are unlikely to drop anytime soon.

He added: "The demand has always been very strong so even though you have improved the supply... it will just cause the general situation where it's easier for people to get a COE. But this may not directly contribute to lower COE price."

Besides demand and supply, LTA said COE prices are also determined by factors such as economic conditions and a buyer's personal choice.

The biggest increase is for the Open Category E, which sees a 53.4 per cent jump with 586 COEs up for bidding each month.

Monthly COE quota for Category A, or cars of up to 1,600cc and 97KW, is set at 1,011, a 41 per cent increase over the last three months.

Monthly COE quota for Category B, or cars above 1,600cc and 97KW, is 966, a 37.8 per cent increase.

Monthly COE quota for Category C, or goods vehicles and buses, sees a 46.9 per cent increase, with 770 COEs.

There will be fewer COEs for Category D for motorcycles -- at 686, which is a 4.58 per cent decrease in the monthly quota.

Prof Lee said: "The higher COE supply is a welcome trend both from the car buyers' point of view as well as car dealers' point of view.

"However, overall speaking, if you suddenly have a up and down trend in overall COE supply, this is not really healthy to the COE transaction prices... My understanding from the car dealers' point of view is (they prefer) a stable COE supply."

Still, dealers welcome the new quotas.

Leon Ho, a procurement officer with Supercars Concept, said: "It's significantly more than usual. So we hope to see a significant drop in COEs, finally.

"The last bidding Cat A went down (around) S$1,000, so (hopefully for) the next bidding, Cat A may go down S$2,000 to S$3,000."

The COE prices for motorcycles hit a record 17-year high, at S$4,489 during the last bidding.

And the Singapore Motor Cycle Trade Association (SMCTA) said it is expecting further increases going forward due a lower quota for motorbikes.

Dealers are also rushing to clear older models that do not comply with new emission standards that kick in this October.

The association is also appealing to the National Environment Agency to extend the deadline for these older motorbikes.

Wilson Poon, president of the SMCTA, said: "Since January, the COE quota has reduced by 30 per cent. The prices of the motorcycles have gone up due to the COE so that definitely affects the affordability for a lot of customers. As a result, that affects the industry quite a bit." 

LTA said that in the last year, changes to the COE system were made after feedback from the public and industry.

These included refining the categorisation criteria for Cat A and B cars and shortening the quota cycle to quarterly instead of half-yearly periods, to be more responsive to de-registrations.

LTA said the motor industry is still adjusting to these changes and there are no plans to introduce further changes for now.

The next quota announcement for the bidding period of August to October 2014 will be made in July 2014. - CNA/nd/ac

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