SINGAPORE: Certificate of Entitlement (COE) prices rose in all categories on Wednesday in the first bidding exercise after a cut in quota numbers kicked in this month.
The premium for Category A (small cars 1,600cc and below) soared from the previous high of S$68,656 to set a new record of S$73,501. The 7 per cent (or S$4,845) spike came despite taxis having been removed from this category.
Taxis were taken out of the COE bidding process from August after feedback that they may have had an influence on COE prices. COEs to be used for taxi fleet expansion will now be extracted from the quota for Category E instead.
Premiums in all other categories also rose.
COEs for Category B (cars 1,601cc and above) now cost S$94,502 each, a 4 per cent or S$4,001 increase, compared with S$90,501 in the previous bidding exercise.
For Category C (goods vehicles and buses), the COE now stood at S$57,001, compared with S$55,805. This was an increase of 2 per cent, or S$1,196.
For Category D (motorcycles), the COE premium was S$2,081, compared with S$1,859. This was an increase of 12 per cent, or S$222.
In Category E (open), premiums closed at S$95,034, compared with S$92,700. This was an increase of 3 per cent, or S$2,334.
Dealers said the higher COE prices seen in the latest round were largely due to a cut in COE quota numbers which took effect in August.
Dealers added that the longer break between the latest and the previous bidding exercises — three weeks instead of the usual two weeks — was another factor that pushed up the number of bids and prices this time round.
Speaking about the Category A premium, general manager of Tan Chong Motor Sales, Ron Lim, said: "I think no one can actually put a guess into how far the Category A premium would continue to grow. We are sort of in uncharted territory as we are looking at the quota being reduced by a significant 37 per cent this round.
"The taxi companies might be out of the game right now in Cat A, but just the sheer size of reduction in terms of quota in itself, I think is the big factor behind today’s price increase."
Industry players Channel NewsAsia spoke to said the high COE premium for small cars will affect those selling mass market brands.
"The buyer profile has actually changed a lot in terms of affordability," senior manager at KIA Motors Chee Kee Min said.
"If you look at the rationale of it, if you’re already paying S$70,000 to S$90,000 for a basic piece of COE, you might as well pay a little bit more to own a so—called better car, with better specifications and all."
Dealers expect prices to continue to rise further, given the lower quota numbers over the next bidding rounds.
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