SINGAPORE’S Certificate of Entitlement (COE) premiums for all five vehicle categories dropped in January’s second round of bidding, with the open and large-car categories leading the way for passenger cars, while the motorcycle category had the biggest overall decrease.
The price for Category E, the open category which can be used to register any type of motor vehicle except for motorcycles, fell by 6.4 per cent or S$7,888 to S$115,112.
Category E is typically used to register cars that fall under Category B, which is almost always the most expensive type of COE.
The premium for Category B fell 4 per cent or S$4,876 to S$116,625.
The Category B COE applies to larger or more powerful cars that have engines of more than 1,600 cubic centimetres (cc) in capacity or with more than 97 kilowatts (kW) of power, or for electric vehicles (EVs) with more than 110 kW of power.
In January’s first round of bidding, Category B shot up to S$121,501, its highest level in over a year.
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The price for Category A, for mainstream cars, dipped 0.1 per cent or S$98 to S$93,601.
The Category A COE applies to mainstream cars that have engines of up to 1,600 cc in capacity or with up to 97 kW of power, or for EVs with up to 110 kW of power.
Among non-passenger car categories, Category D – for motorcycles – posted the largest decrease. It fell 14.2 per cent or S$1,280 to S$7,721. The last time the premium fell below this level was in May 2023, when it was S$5,002.
Prices for Category C, applicable to commercial vehicles and buses, decreased 3.6 per cent or S$2,415 to S$65,476.
Moderating effect
In 2024, low COE premiums in January’s first round of bidding before the Singapore Motorshow led to brisk buying activity. This led to a large spike in premiums after the event, with the price for Category B rising as much as 31.7 per cent.
Car dealers said the opposite happened this year, as high COE premiums leading up to the 2025 motorshow had a moderating effect on sales.
Jason Lim, managing director of BMW dealer Eurokars Auto, said: “Before the Motorshow, the huge increase in Category B’s price led to lukewarm sales for most brands during the event. So there’s much less of a rush to clear orders, unlike last year.”
Anthony Teo, managing director of BYD distributor and dealer Vantage Automotive, said that he expected the Category B premium to fall after the high of January’s first round.
“The Motorshow was quite okay for us, in sales terms, but for some other brands it was slower. Dealers that wanted to bid to put cars in customers’ hands before Chinese New Year would have already done so in the previous round,” he said.
In the car industry, Chinese New Year typically drives COE premiums up as customers put pressure on dealers to deliver their new vehicles before the holiday season.
Both Lim and Teo added that some potential customers held off on buying after the Land Transport Authority announced an 8.2 per cent overall increase in COE quota for the period of February to April this year.
The announcement led people to adopt a “wait-and-see” approach, said Lim, while Teo said that “everyone is waiting” for the larger COE quota to take effect, which could bring premiums down.
Bikers cool off
Motorcycle industry players also said that Chinese New Year seasonality could have caused the fall in the motorcycle COE premium.
Rex Tan, president of the Singapore Motor Cycle Trade Association, said that because a motorcycle COE is valid for only one month, dealers are more cautious holding the certificates across Chinese New Year as office holiday closures could last up to two weeks.
This significantly reduces the amount of time they have to use the COE, so they hold back from bidding in the round before the holidays.
The sales manager for a multibrand motorcycle dealership told The Business Times that more buyers would have purchased a new motorcycle during the National Bikers’ Weekend event in October 2024.
In addition, the months of December and January are typically slow ones for motorcycle sales.
Unlike car buyers, riders do not typically feel compelled to acquire a new ride before Chinese New Year, he added.
