Certificate of entitlement (COE) prices in Singapore increased modestly in the latest tender exercise held on October 21, with Category A premiums for smaller and less powerful cars climbing to $132,004, surpassing Category B premiums for larger vehicles for the fourth time this year. Category A prices rose by 1.5% from $130,001, while Category B premiums increased 14% to $131,901 from $130,100 in the previous round.
The COE system, managed by the Land Transport Authority (LTA), was last reviewed ahead of this tender exercise, with authorities currently seeking public feedback on proposed revisions. Among the suggested changes is a plan to merge Categories A and B into a single passenger car category. Under this proposal, COE prices would be linked to the vehicle’s cost, with surcharges or rebates applied to distinguish between high-end and mass-market cars.
In contrast to Category A and B vehicles, the open category (Category E) COE price saw a slight decline of 0.9%, dropping to $135,790 from $137,000. Certificates in this category are transferable and can register almost any type of vehicle except motorcycles, making them popular among motor traders for their flexibility. Commercial vehicle COEs edged up 0.3% to $92,200, while motorcycle COEs decreased by 2.1% to $10,778.
Several motor dealers reported slowing car sales in recent weeks but noted strong demand for Chinese electric vehicles (EVs), attributed to buyers rushing to secure purchases before EV incentives expire on December 31. The government has announced a $10,000 reduction in the EV tax rebate for 2027, alongside a revision of the Vehicular Emissions Scheme (VES) that will increase penalties for non-EVs by $7,500.
An LTA spokesperson commented on the high prices, noting the upcoming Car Expo at Singapore Expo from October 24 to 25, which may be driving strong demand and elevated COE premiums. The agency urged buyers and dealers to exercise prudence in bidding and indicated that feedback on the COE system proposals would be carefully considered before implementing any changes.
Industry insiders cited a mix of factors contributing to the current COE trends. Ng Choon Wee, commercial director of Komoco Motors, which distributes Hyundai vehicles, characterized recent bidding as “irrational” and said market conditions have been weak since September. Nicholas Wong, CEO of Kah Motor, the Honda dealer, said anxiety among dealers over anticipated surges in COE prices ahead of the Car Expo may have driven up bids at the latest exercise. Corinne Chua, managing director for Volvo at Wearnes Automotive, highlighted fears that COE premiums could continue rising toward the end of the year as a factor influencing demand.
Dealers also noted that Category E COE prices have stabilized around $135,000, a trend expected to persist through the Car Expo period. Some buyers appear to be accelerating their purchases to avoid anticipated price increases resulting from the proposed categorical merger and reduced EV incentives starting next year. Ng indicated that despite higher COE premiums, efforts would be made to offset cost increases for consumers with additional promotions during the upcoming exhibition.