SINGAPORE — After falling to a five-year low earlier this month, Certificate of Entitlement (COE) premiums for big cars rebounded by the close of the latest bidding exercise on Wednesday (Feb 17).

The premiums for big cars (above 1,600cc and 97kW) rose to S$46,970, an increase of more than 20 per cent from S$38,610 in the previous bidding exercise two weeks ago. In that exercise, premiums for big cars saw the sharpest fall of more than S$11,000 to reach S$38,610, the lowest figure in more than five years. The previous low was S$35,909 in July 2010.

Apart from big cars, premiums for the Open Category — used for any vehicle type but typically for luxury cars — rose slightly to S$45,009 from S$$44,001 two weeks ago.

For the other categories, COE prices continue to drop.

The premiums for small cars (up to 1,600cc and 97kW) fell by 7.8 per cent to S$43,000. Premiums for Category C — for goods vehicles and buses — dipped slightly by 0.08 per cent to S$45,001. Motorcycle premiums closed at S$ 6,353, a 3.1 per cent drop from early February. A total of 7,429 bids were received this round, with a quota of 4,240 COEs available for today’s bidding exercise.

Traders predicted that COE premiums for cars would continue to see a declining trend, citing the economic outlook and de-registration of cars.

Mr Eddie Loo, managing director of car dealer CarTimes Automobile, said car buyers would be more cautious in spending: “If the economy is not fantastic, (there is) job uncertainty … so if they don’t have the assurance of a guaranteed income, I don’t think anybody would like to splurge on a luxury item like cars.”

The de-registration of cars, he added, would mean that a greater supply of COEs would be released, affecting prices.

From this month to April, a total of 25,210 COEs — or 8,403 COEs a month — will become available as more motorists continue to de-register their cars as their COEs hit the 10-year expiry date.

Mr Ricky Tay, managing director of RTMT Motor, expects the COE premiums for small and big cars to drop only gradually over the next two or three months because there is still demand, and estimates premiums to “hover around” the S$45,000 mark for big cars, and S$41,000 for small cars.

For Mr Raymond Tang of Yong Lee Seng Motor, his estimation is that premiums for big cars may range between S$45,000 and S$50,000 in the next bidding exercise coming up in three weeks. The managing director noted that there were 1,701 unsuccessful bids for the 2,898 quota available for big cars in today’s latest bidding exercise.

“There is a backlog … so there’s definitely a demand (for car orders and this pushes up the premiums for big cars),” he said.