The Land Transportation Authority (LTA) of Singapore on Monday, October 23 announced the government's plans to cut off the growth rate of certificate of entitlement (COE) for vehicles to zero by early 2018. Industry players predict Singapore will see an increasing cost of vehicles in the following years as LTA targets to implement the new bulletin in February 2018.
The announcement of zero growth of cars in the country is not the sole factor why vehicles will be much more expensive in the next years. According to traders, stricter exhaust emission standards will also spike taxes on most cars by January.
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Around 1,500 COEs per year are expected to be removed starting February 2018, which will result in the decrease of about 0.25 per cent to zero in vehicle growth. With the new policy, car owners are expected to renew their COEs instead of ditching their wheels.
Talking to TODAY, Tan Chong Motor Sales' general manager Ron Lim says the new emission standards will cause new cars to be more costly regardless of COE premiums movement. Ricardo Cars director Jeremy Soh also notes surcharges will be added on car models.
On the other hand, Yong Lee Seng Motor director Raymond Tang still sees a potential car owners bidding for new COEs before the February 2018.
"We could see some panic buying as people may rush in to bid before the curb sets in," says Tang. "We already see some of such behaviour now, in view of the higher emission standards next year."
As the availability of COEs become limited, CarTimes Automobile managing director Eddie Loo says "the upcoming policies are an attempt to convey that cars are 'luxury items'."
