COE premiums close mixed in final bidding exercise of 2016

SINGAPORE  — Certificate of Entitlement (COE) prices rose for all three categories for cars after the latest bidding exercise — the last one for 2016 — ended on Wednesday (Dec 21), with premiums for Category B (above 1,600cc or 97kW power output) rising by 10.5 per cent to close at S$51,109 after a nine-month low. 

Prices for Category A (up to 1,600cc and 97kW) went up by 3.6 per cent to S$49,751, while Category E, which can be used for any vehicle but is usually utilised for big cars, rose by 0.7 per cent to close at S$50,389. 

However, the COE for motorcycles continued to dip for a third month, closing at S$6,101. Similarly, premiums for commercial vehicles and buses went down by 3.3 per cent to S$49,500.

Motor traders said the sharp drop in premiums for Category B cars in the previous bidding exercise earlier this month — caused by consumers being cautious because the cloudy economic outlook — had led dealers to revise their prices downwards. 

The sweeter deals led to a “knee-jerk reaction” among car buyers who felt that it was the right time to enter the market and make their purchase in time for Chinese New Year, said Mr Jeremy Soh, director of Ricardo Cars.

“Over the past few biddings, premiums for Category B were on the downtrend. Then, with the big drop (in the) last round, it became a good deal to come into the market,”  he added.

However, with Category B premiums now stabilised, car dealers are expected to raise prices by S$4,000 to S$5,000 in the coming weeks, said managing partner of Mayfair Motoring Mike Wee.

As prices for commercial vehicles and buses became “too high” in the first bidding exercise this month, shooting past the S$50,000 mark, dealers would have lowered their prices — which explains why premiums in this category went down in the latest exercise, said Mr Raymond Tang, Singapore Vehicle Traders Association’s first vice-president. Mr Tang said COE prices are set to remain within the current range in the next two months. However, the situation could change following the Government’s unveiling of Budget 2017, which would give a clear indication of Singapore’s economic situation.

The Budget’s offerings, he added, would either boost confidence or result in customers tightening their belts, and such developments are set to have an impact on COE prices.

Here are the numbers at a glance:

Cat A (Cars up to 1600CC & 97KW): S$49,751 (up from S$48,000)

Cat B (Cars above 1600CC OR 97KW): S$51,109 (up from S$46,229)

Cat C (Goods vehicles and buses): S$49,500 (down from S$51,209)

Cat D (Motorcycles): S$6,101 (down from S$6,113)

Cat E (Open category): S$50,389 (up from S$50,010)