Nearly 13% fewer COEs for next 6 months

SINGAPORE: A total of 19,351 Certificates of Entitlement (COE) will be made available between August this year and January 2013.

This is a cut of 2,809 or 12.7 per cent from the 22,160 certificates available in the previous six—month period from February to July 2012.

The cut comes mainly from the small cars category, where the quota will see a drop of 36.6 per cent. The category will now have a monthly quota of just 786 certificates, down from 1,239 between February and July this year.

The COE quota for the open category also dropped significantly. It will now have a quota of 485, a 21.3 per cent drop from the previous six—month period.

The COE quota for big cars will be 701 per month. This is comparable to the monthly quota of 699 between February and July 2012.

For goods vehicles and buses, the COE quota has been increased to 360 per month, a 12.85 per cent increase from the previous six—month period.

There will also be more monthly COEs for motorcycles, at 894 — up from 820 in the previous six—month period.

Market watchers said they expected smaller quotas due to a fall in the number of vehicles de—registered over the past six months.

It fell by 8.7 per cent, compared with the second half of last year.

Triangle Auto’s director Michael Wong said: "If you compare this scrap rate to the last six months — which is July last year to December — the total number of scraps for Category A has actually fallen. So that is why you have a lower Cat A COE, and that’s one of the main reasons for the reduction."

Market watchers expect COE premiums to go up for small cars, testing the recent highs of S$67,000.

Tan Chong Motors’ general manager Ron Lim said: "The issue on hand is that demand has sort of cooled off following the announcement that Land Transport Authority (LTA) or the government itself is going to review what they can do to curb this COE crunch.

"There are quite a number of customers who have been holding back and this is building up a pent—up demand. And now with this cut, you’re going to see COE prices moving up quite sharply, at least in the short term."

Bidding under this quota will start with the August 2012 First Open Bidding Exercise.

LTA said the COE quota for August 2012 to January 2013 consists of two components.

These are: the provision for a one per cent vehicle growth, based on the vehicle population as at December 31, 2011; and the replacement COEs for vehicles de—registered between January and June this year.

The next COE quota announcement for the COE bidding period from February 2013 to July 2013 will be made in January 2013.

In May this year, LTA had announced that the vehicle growth rate will be reduced to 1.0 per cent per annum from August 2012, before being further reduced to 0.5 per cent each year from February 2013 to January 2015.

In addition, a total of 4,789 remaining adjustments for over—projections in Quota Years 2008 and 2009 that were scheduled to be spread over bidding months from August 2012 to January 2014 will now be deferred for one year from August 2012 to July 2013.

They will resume from August 2013 to January 2015.

— CNA/fa