COE premiums for small cars fall to seven-year low
TODAY file photo
SINGAPORE — Certificate of Entitlement (COE) prices for small cars tumbled to S$36,001 yesterday, the lowest since November 2010, in the first bidding exercise since the stricter Euro 6 standards came into force earlier this month.
Motor traders attributed the 16.08 per cent drop for Category A vehicles (up to 1,600CC & 97KW) largely to the uncertainty on how the new emission standards would play out.
The Euro 6 standards, which are set by the European Union, are aimed at reducing nitrogen oxides and fine particulate emissions — in particular the PM2.5, the tiny particles that penetrate deep into the respiratory system — from vehicular emissions.
Mr Raymond Tang, managing director of Yong Lee Seng Motor, said that traders and consumers are now “adopting a wait-and-see approach” on how COE premiums will pan out, as the new emission standards had just kicked in on Sept 1.
“They will want to see … what the price adjustment will be like … (and) what (the COE premiums) will be like (under the new emission standards), before deciding (how to bid),” he told TODAY.
Mr Jeremy Soh, director of Ricardo Cars, added that for distributors, their Euro 6-compliant cars might already have been on the market.
However, for parallel importers, they would “would need to iron out” issues such as getting the necessary certification, and testing, for their cars, before returning to bid in future COE exercises competitively.
Apart from the Euro 6-factor, some traders also pointed to the softening of demand from private-hire operators as another reason for the drop in small car premiums.
Mr Neo Tiam Ting, president of the Automobile Import and Export Association (Singapore), said that both private hire giants Uber and Grab “do not have very big batches (of cars) coming in”, and would hold back on bidding aggressively.
The new low for Cat A vehicles followed a downward trend for the COE prices of such cars for the most part of this year.
COE prices for these cars hit a high of S$92,100 on Jan 9, 2013, a sharp increase from Nov 19, 2008, when premiums in this category closed at just S$2.
Given that COE premiums in Cat A have now fallen to a seven-year low, motor traders said prices are likely to pick up in subsequent bidding exercises. They also expect car showrooms to have brisk business this weekend.
Yesterday’s bidding exercise also saw premiums dropping for large cars (above 1600CC OR 97KW) to S$49,000, from S$51,000 in the previous exercise.
In the Open Category, which can be used for any types of vehicles, premiums went down by 3.99 per cent to S$48,005.
Separately, the category for goods vehicles and buses saw COE prices go up by 2.38 per cent to S$43,002.
In the motorcycle category, premiums went up to S$5,402, compared to S$3,512 in the previous exercise.
