First COE bidding since LTA measures end mixed
Singapore - Certificate of Entitlement (COE) premiums ended mixed yesterday in the first bidding exercise since the Land Transport Authority (LTA) announced measures to ease the supply crunch, as buyers adopted a wait-and-see stance.
The COE premiums for cars up to 1,600cc and taxis rose by 1.73 per cent to S$59,003, compared to two weeks ago, while those for cars above 1,600cc fell by 2.67 per cent to $83,000.
COEs in the open category, which are for any vehicle type but end up being used mainly for bigger cars, finished 1.15 per cent weaker at S$85,889.
Last week, the LTA announced the annual vehicle population growth rate will be allowed to grow at 1 per cent from August - higher than the 0.5 per cent originally planned - and adjustments for COE over-projections will be deferred.
Singapore Vehicle Traders Association secretary Raymond Tang felt the "real reaction" to the moves announced by the LTA would only be seen in the next bidding exercise. "In August, there will be less COEs available because of less vehicles being de-registered," he said. "There are a lot of interested buyers in the market but they are waiting to see how the market reacts to the measures."
However, Mr Teo Hock Seng, managing director of Hyundai distributor Komoco Motors, felt the market will remain "slow" until the 1-per-cent growth in vehicle growth rate is spelt out in actual numbers.
"We do not know the exact numbers and only have our own calculations. We have to wait and see if motor traders are still attracting buyers at this price," he added.
While taxi companies will need to ramp up their minimum fleet size requirement - from 400 taxis to 800 - Mr Tang felt that the impact on COE premiums would even out, citing taxis' shorter life span of seven years and their eventual de-registration would mean the COE would be plough back into the Category A quota.
By Sumita Sreedharan
07 June 2012