The Land Transport Authority increases COE supply amid soaring premiums and high vehicle demand.
SINGAPORE – In response to rising COE premiums and robust vehicle demand, the Land Transport Authority (LTA) has announced an additional 1,614 Certificates of Entitlement (COEs) for the upcoming three months. This move builds on the 1,895 COEs reallocated earlier in October, for the period between November and January.
COE Supply Distribution
The largest boost will go to the category for larger cars with engines above 1,600cc or 130bhp, and electric vehicles (EVs) above 110kW, which will see 863 more COEs made available. This is a 29.4% increase, raising the total for the category to 3,800 COEs over the next three months.
For smaller cars with engines up to 1,600cc and EVs with power outputs of up to 110kW, an additional 546 COEs will be released, representing an 11% increase, taking the total number available to 5,513. In addition, the COE quota for commercial vehicles will rise by 22.2%, adding 205 more certificates, bringing the total for this category to 1,129.
Impact on COE Premiums
This increase in supply comes at a time when COE premiums have reached record highs. The most recent COE tender saw premiums for larger cars at $150,001 and for the Open category at $158,004. The premium for smaller cars also climbed to $106,000. Despite the boost in COE supply, premiums are expected to remain high, with the LTA forecasting a continued increase in COE quotas for categories A, B, and C through 2024, peaking in 2025.
Industry Reactions
Motor dealers and industry experts have welcomed the announcement. The move is seen as timely, especially as new emissions standards will be enforced from January for new private cars and taxis sold in Singapore. These regulations require car models to meet stricter emissions standards, prompting a rush to clear existing stock.
Despite the increased COE supply, some dealers caution that the impact on retail sales may be limited due to weak consumer demand. However, experts note that easing prices for commercial vehicle COEs would help mitigate cost pressures on businesses.
