Was Toyota really number one in Singapore in 2020? How close are SUVs to dominance? And why EVs won’t be the big thing in 2021
2020 was a tumultuous year for the entire world, and Singapore’s passenger car market was no different. Compared to 2019 and 2018, there was a significant reshuffling of brands in the top 10, a big change in the type of cars Singaporeans bought, and the rise of electrified cars — but perhaps not in the way you think.
The big picture is that the car market contracted by more than a third in 2020, dropping from 72,344 cars sold to 44,465, a 38.5 percent reduction. In raw sales terms, it means pretty much every brand sold fewer cars in 2020, compared to 2019. In comparison, from 2018 to 2019 the car market only shrank 10 percent.
The shrink was in part due to the Circuit Breaker measure that saw car showrooms close totally and COE bidding suspended for three months. The good news is those COEs will be redistributed over the next 12 months (from July 2020) and sharing some of the love with 2021 — see our expectations for 2021 further on down in the story.
But the main reason for the contraction is the 10-year cycle the car market is locked into because of COEs. With zero car population growth allowed, it’s one car out = one car in, so the COE quota is almost directly determined by de-registrations. What happens when most of the cars are younger than five years old? Newer cars mean fewer de-regs = shrunken quota = smaller new car market, at least for the next three years.
With the Big Market Shrink in mind, we’ve expanded our Top 10 ranking to take into account overall market share as well in our analysis.
A typical year sees the top five stay the same, maybe swapping one position each. As you can see from 2019 and 2018’s results, the top five are largely the same, with the bigger reshuffles further down the order.
Seeing Toyota at the top is of course no surprise, but it’s definitely welcome news for the brand after trailing Honda to the top step in the preceding two years. Toyota, and authorised distributor Borneo Motors, went all in for 2020 with the switch to a strong virtual presence, the introduction of Toyota Financial Services and a new Corolla Altis holding down the fort.
Honda was hobbled by fewer new releases last year, with only the City sedan and facelifted CR-V SUV. The new City was its headline model for 2020 and very impressive for the segment, but the decline of the compact sedan market and higher COE prices meant it wasn’t a sure-fire best-seller like it was in the past.
But here’s the shocking fact: Toyota did very well, but its sales figures have (since time immemorial) included Lexus sales as well. Was Lexus able to sell at least 1,134 cars, the difference between Toyota and Mercedes? We think so, and it would mean that Mercedes-Benz was actually the best-selling brand in Singapore, bar none.
And speaking of cycles, this has happened before, back in 2013 without needing to read between the lines. That was back when the monthly COE quota for Cat A was a mere 700-800 units a month, compared to 1,500 units now and COEs were stratospherically-high, from S$60,000 to S$90,000 for both Cat A and Cat B. Under such conditions, it’s much more logical to pay S$200,000 for a Mercdes-Benz C-Class than S$120,000 for a Toyota Corolla, which enabled luxury brands to take the podium.
Yet that’s not the situation now, so what gives? In a word, Mercedes-Benz’s range of small cars has really taken off. A prospective Mercedes owner who doesn’t want to spend more than S$200,000 actually has eight models to choose from in 2020: A-Class sedan/hatch, B-Class, CLA coupe/wagon, GLA, GLB, and C 160. It also introduced lower priced, less powerful versions of its small models, like the A 180 in 2020.
Mercedes has managed to snag newcomers to the brand, or those who couldn’t afford one before, while also retaining its traditional audience of C, E, and S-Class buyers.
Not to mention that in 2020 it managed to sell around half, if not more, of the 100-plus coupes and convertibles sold in Singapore each month. As a result, the German luxury brand was able to sell 16 percent fewer units in 2020 but still increase its market share from 10.8 percent to 14.8 percent, the biggest increase of any brand.
Page 1: The Top 10 – the podium analysed
Page 2: The Top 10 – the other Germans, and mainstream brands
Page 3: The most popular car types in Singapore in 2020
Page 4: Why 2021 is the Year Of The Hybrid and more predictions