With Heightened Alert restrictions lifted in late August 2021, Singaporean car buyers came back wallets out and the rise in COE prices show it
SINGAPORE – Admit it, you’ve done it to: Stuck at home, constant scrolling, suddenly (or not so suddenly) you get the idea that your ‘insert major consumer item here’ is due for a upgrade and bam, you have a new car/fridge/smartphone/dog*.
Revenge shopping is a thing and it well and we think it truly hit car buyers too right after the return of Phase 2 Heightened Alert. How do we know this? First of all, lockdown fatigue is a thing, and secondly the numbers show it: Certificate of Entitlement (COE) categories associated with the fat end of the market, namely Cat B and E, saw noticeable spikes.
In fact, it’s basically the opposite of what we saw in the first round of August – a price drop due to HA.
|Category||August 1st||August 2nd||Change|
|CAT A (Below 1600cc or 130hp)||S$45189||S$46,689||+ S$1,500|
|CAT B (Car above 1600cc or 97kw)||S$56001||S$61,001||+ S$5,000|
|CAT E (Open – all except Motorcycle)||S$59599||S$64,901||+ S$5,302|
Category B, for cars with engines that make more than 130hp, or are larger than 1.6-litres in capacity, went from SS$56,001 to SS$61,001, while Category E saw an even higher increase from SS$59,599 to SS$64,901, or SS$5,302. That’s extra relevant, as we’ll explain later.
Compare Category A, the certificate for ‘mainstream’ cars (with less than 1.6-litres of engine capacity, or less than 130hp output) : Cat A COE price came in at SS$46,698 – it only increased SS$1,500, or 3.3 percent, while Cat B’s increase was 8.9 percent.
The industry scuttlebutt was that the German brands led the charge with attractive prices – we’re sure you’ve seen National Day sales events from multiple brands splashed across your browser.
Audi’s most popular model here, the A3, just debuted in its new form in June and has continued its traditional form. Meanwhile, BMW has been very aggressive with its sales push, especially of its popular 2 Series MPV models. If July is anything to go by, where it registered more cars than any brand bar Toyota, we could be looking at a big August for BMW.
We said before that Cat A is more subject to price fluctuations, but we should clarify that here: It’s fluctuations from external factors like pandemic lockdowns – but when it comes to ‘normal’ prices and demand, it’s more resistant to fluctuations. Meanwhile, Category B is the opposite, as we saw in the last round of COE bidding.
Lastly, another reason for the all-around price increase is Yet Another Quota Cut, which begins in August, and always presages an increase in prices for passenger car COEs.
And we have reason to believe that there’s more price increases due to demand on the way post-August – Category E COE price went up the most. Cat E is unlike other Categories, since it’s used to register Category B cars most of the time. Also, it has a six-month validity, so luxury car dealers expecting more demand in future stock up on them beforehand, driving the price up.
*Please adopt, don’t shop, and do your research before dogging. Or catting. Or hamstering. Or other sentient-being-ing.