SINGAPORE - The certificate of entitlement (COE) price for Category A vehicles hit $103,009 at the latest tender exercise on May 7.

Meant for smaller and less powerful cars and electric vehicles (EVs), the latest price for Category A COEs is 3.5 per cent higher than the $99,500 recorded at the previous tender exercise held two weeks ago on April 23.

This is the highest price for this COE category since October 2024, when it hit $103,799.

The Category B COE premium, needed to register bigger and more powerful cars and EVs, rose by 2.5 per cent to $119,890, from $117,003.

The premium for an Open category (Category E) COE was $118,889 – 0.8 per cent higher than the $118,001 in the previous exercise.

Open category COEs can be used to register any vehicle type other than motorcycles, but are almost always used for bigger and more powerful cars.

This is the first COE tender exercise under the May to July quota period with 6.4 per cent more COEs available than in the previous three-month period.

The COE premiums for commercial vehicles and motorcycles dipped.

The commercial vehicle (Category C) COE premium came in at $62,590, 3.7 per cent lower than the $65,001 set in the previous exercise.

At $8,709, the motorcycle (Category D) COE premium was 6.4 per cent lower than the previous exercise’s price of $9,309.

A COE allowing ownership of a car for 10 years is needed in Singapore to register a vehicle. Under the current policy, when a COE expires, it is returned to the pool for bidding. The motor industry has projected that a higher number of COEs will expire in 2025 and 2026 than in previous years.

Some motor traders noticed that in recent weeks, demand has increased from owners trading in cars that were registered in 2015 or 2016, months before the cars are due to be scrapped.

At BMW Eurokars Auto, owners of cars nearing the end of their COEs bumped up the sale of new cars by between 20 per cent and 30 per cent over the weekend, according to the dealership’s managing director, Mr Jason Lim.

Some owners may be replacing their older Category B cars with Category A EVs.

According to Mr Soh Ming, managing director of Volt Auto, 40 per cent of buyers of the company’s Dongfeng EV, which is a Category A EV, are trading in older Category B cars.

Overall, motor dealers noted that the sheer number of Category A EV models puts pressure on the COE price with keen promotions and marketing tactics from sellers. These are not just Chinese mass-market EVs, but also premium options, including the Tesla Model Y, which used to be available only as a Category B model until the recent update introduced a lower-powered Category A variant.

Dealers with a backlog of orders to fulfil may also be pushing up the Category A COE price, according to Mr Nicholas Wong, chief executive of authorised Honda dealer Kah Motor. These would have come in February when the price of the COE fell to $85,000 from January’s $93,601.

Sales contracts generally allow motor dealers about three months – or six rounds of COE bidding exercises – to secure the COEs for these orders. Those who were unsuccessful in doing so before now would be under pressure to get the COEs quickly or risk losing the order.

Mr Chong Kah Wei, managing director for Mazda at Trans Eurokars, said that the higher Category A COE price was also fuelled by The Car Expo, a large-scale car sales event that was held on May 3 and 4, organised by SPH Media, the publisher of The Straits Times.

He said that Category A models accounted for a bigger proportion of the deals closed at the event than Category B cars. He believes that premiums for both categories will start to come down after these cars are delivered.

However, Mr Anthony Teo, managing director of Sime Motors, which distributes BYD, expects the Category A COE premium to remain high at the next tender exercise because of the many unsuccessful Category A COE bids in the latest round, while the Category B COE premium may drop a little from the demand easing.

Source: The Straits Times

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Amanda Tan

Head of Marketing, Volt Auto

HP: (65) 82231936

Email: amanda@voltauto.sg