COE Analysis September 1st Round: What goes up must go up

Ben Chia
singapore coe analysis

A three week break between bidding exercises resulted in the inevitable rise in COE premiums, but things are not as straightforward as it seems


While COE prices do tend to be unpredictable, there are some things which generally holds true. Typically, if there’s a three week lull in between COE biddings, as opposed to the usual two week interval, the premiums would usually see a rise over the previous exercise.

This is because dealers would have had more time to collect orders during that time, and thus there would be more competition during the bidding exercise due to pent up demand. 

And so it has proven with the latest COE exercise for September, with premiums edging upwards from the previous bidding in August. Category B, for cars with engines that make more than 130hp, or are larger than 1.6-litres in capacity, saw prices go up from S$61,001 to S$62,600, an increase of S$1,599.

Category A, the certificate for ‘mainstream’ cars (with less than 1.6-litres of engine capacity, or less than 130hp output), saw a more modest increase, going up by a mere S$311, from S$46,689 to S$47,000.

Perhaps more interestingly, Category E, which is Open to all vehicles except motorbikes, saw a drop instead, albeit a minuscule one of S$201, from S$64,901 to S$64,700.

The increase in premiums don’t seem too drastic for a typical three week break period, so what gives then? While part of it could be due to a slight correction on the market, given that the second bidding for August saw significant rises across the board, industry sentiment are pointing towards generally weaker consumer confidence as a result of the impact of the pandemic.

Rises are inevitable, given that COE quotas are being progressively cut, but the signs are that consumers, especially those shopping in the mainstream Cat A, are being more cautious with their spending amid the general economic uncertainty. While Singapore is on the road to recovery from the pandemic, the country is not quite out of the woods yet, and it’s only natural that car buyers would prefer to hedge their bets for now until the picture becomes clearer.

Cat B is generally less susceptible to such external influences, but their strong showing can also be attributed to a few other factors. Aside from the fact that the consumers in this arena tend to have a bit more leeway in their finances, there’s also far more competition in Cat B now as opposed to Cat A.

Mainstream models like the Volkswagen Golf are now competing for Cat B COEs with premium cars

Cars like the Volkswagen Golf, which used to compete with the Toyotas and Hondas in Cat A, are now jostling for Cat B COEs with Mercedes-Benzes and BMWs, yet without too much of a premium attached to its price tag. The signs are that consumers are starting to place less significance on the dividing line between Cat A and B now, and instead the final selling price is what sways their ultimate purchasing decision.

If that’s the case, then perhaps we might see Cat B eventually reach parity with Cat A, but that might not happen for quite some time. In the meanwhile, we might see premiums continue to rise based on the current trajectory. But as the past year and a half has shown, you never know when you’ll get another spanner in the works to disrupt proceedings once again.


Analysis coe

About the Author

Ben Chia

CarBuyer's senior staff writer went out to explore the Great Big World, including a stint working in China (despite his limited Mandarin). Now he's back, ready to foist upon you his takes on everything good and wonderful about the automotive world. Follow Ben on Instagram @carbuyer.ben

Leave a Reply

Your email address will not be published.

CarBuyer – Revolutionizing The Online Car Marketplace In Singapore

Buy Used And New Cars Online
Start your car buying journey with CarBuyer as we connect you seamlessly to the industry’s best CaseTrust-SVTA accredited car dealerships. As a one stop car online portal you can now buy your new ride, be it a pre-owned car or a brand new car from trusted dealers all over Singapore, all in one place. Our ever expanding listing of quality and covet-worthy cars, new and second hand, from both owners and trusted car dealers, will leave you spoilt for choice. Refine your search by vehicle type, registration year, price, mileage, engine type, transmission, annual depreciation value and more to find the car that best suits your needs, taste and lifestyle. You can even search for your car by dealer or directly by owner.

Sell Your Car In An Instant With Confidence
We all know how selling a car in Singapore can be a daunting task especially for a first time car seller; from trying to get a valuation for your car, finding a trusted dealer, to getting the best quote on your vehicle. CarBuyer understands the hassle and even the costs involved and have as such partnered with Huawei to develop a FIRST in Southeast Asia AI car valuation tool that is able to provide a car’s resale value at the snap of a finger. Backed with a consortium of trusted CaseTrust-SVTA accredited car dealers you can be assured that you are getting the best price for your vehicle and do not have to worry about any hidden costs.

The Ultimate Car Shopping Experience Online
CarBuyer platform is the first of its kind to be backed by Huawei’s Artificial Intelligence and cloud computing, enabling it to be able to offer users transparency and enhanced security, all with the one aim of enhancing customer experience. So come on over to buy and sell used cars online at the best prices at CarBuyer Singapore. Connect easily with dealers in real-time via our online video call feature, or schedule a test drive when you’re ready. Have some questions? Get them answered instantly with our chatbot moderated by our responsive team. Stay in the loop with our car-related tips, reviews and news. Learn the ins-and-outs of your car, as well as global and Singapore’s car updates at your own pace.