COE trends

[atrecord]

starlight1968sg:

Small car COE lowest since early 2012


COE for cars up to 1,600cc and 130bhp fell from $62,002 a fortnight ago to end at $57,199 - almost a three-year low.

http://www.straitstimes.com/news/singap ... 2-20150217

I'm hoping cat B will drop significantly in the next 6 months...

[starlight1968sg]

atrecord:

starlight1968sg:

Small car COE lowest since early 2012


COE for cars up to 1,600cc and 130bhp fell from $62,002 a fortnight ago to end at $57,199 - almost a three-year low.

http://www.straitstimes.com/news/singap ... 2-20150217

I'm hoping cat B will drop significantly in the next 6 months...

I have started praying the price of COE to drop below 10k :roll:

[janet88]

The COE seems to be dropping for cat A cars.

[atrecord]

starlight1968sg:

atrecord:

[quote=\"starlight1968sg\"]Small car COE lowest since early 2012


COE for cars up to 1,600cc and 130bhp fell from $62,002 a fortnight ago to end at $57,199 - almost a three-year low.

http://www.straitstimes.com/news/singap ... 2-20150217

I'm hoping cat B will drop significantly in the next 6 months...

I have started praying the price of COE to drop below 10k :roll:[/quote]Wah… you need pray quite hard i think

I think in general Singaporeans have seen an improvement in living standard, and a sizable group has become richer c.f. to about 7-10 yr ago. The rich ones have obviously gotten a lot richer (as seen by reports of record number of millionaires here).

Just look at those people queuing up to buy condos. I was shocked some years ago, when I went to Trevista in Toa Payoh to view the place, and even near the end of the day, must take queue number and wait in tent age to go in…

So, once COE drops to an affordable level (yes, this is arbitrary), almost certainly those with $$ will rush in, either to buy a new car if they do not yet have one, or to replace existing cars. This will support the COE level so I'm not optimistic it will go to <$10K again - barring some catastrophe like global economic meltdown and widespread retrenchment and recession.

And the scenario of mid 2000s will likely repeat if COE drops to, say, $20K: for those who bought in the last year or two, at let's say, $70K COE, after using 2 yr, they can scrap the car, and get back refund from govt of $56K for COE part alone. Use this to buy new car, still get back in theory $36K, plus 2 more years of use of the car… of course there are other costs to consider, but most will just focus on this basic maths…

And not forgetting that the roads are all jammed, so govt is unlikely to increase the vehicle growth rate significantly like 7-10 yr ago...

[sleepy]

please help to refresh memory… any idea why coe drop to under $10k a decade ago?

[hquek]

I don’t think govt will sit aside and let the COE slide further cos they can always tweak the supply of COEs released into the market. By right, there should be quite some released back into market, but last year, they had declared a policy of zero growth in number of cars - so there is a cutback on the numbers released.


Believe it was due to govt policy of allowing all to fulfil dream of owning car. I recall speech by PM wherein govt says they will let pp own cars but make it more expensive to drive one. (My memory could be wrong, but somehow I had this impression he said that)

Now…it’s expensive to drive cars PLUS expensive to own one.

[KSP]

sleepy:

please help to refresh memory... any idea why coe drop to under $10k a decade ago?

lehman brothers collapse in 2008......

[pirate]

atrecord:

And the scenario of mid 2000s will likely repeat if COE drops to, say, $20K: for those who bought in the last year or two, at let's say, $70K COE, after using 2 yr, they can scrap the car, and get back refund from govt of $56K for COE part alone. Use this to buy new car, still get back in theory $36K, plus 2 more years of use of the car… of course there are other costs to consider, but most will just focus on this basic maths…

But every car that is prematurely de-registered like this results in the release of a COE (and hence adds to the COE pool) for the next cycle.

[KSP]

everything has a cycle… stock market, property market or economy…


the COE can only maintain at this level provided the well off are still coming in, hot $ still coming in and no recession…

[atrecord]

sleepy:

please help to refresh memory... any idea why coe drop to under $10k a decade ago?

The prolonged period of low COE premium in the mid-late 2000s (the period you mentioned), was because Govt catered for or allowed 3% vehicle growth per year. Simply put: if at that time there were 1,000 cars on the road, there will be 1,030 cars allowed the next year.

The COE quota (c.f. premium) has a complex formula, which depends on 2 main things:

1) the number of de-registration of old cars in the preceding period of can't remember how long. These will be ploughed back into the pool for recycling as new COE.

2) the vehicle growth rate mentioned above.

Fast forward to 2015, the vehicle growth rate is reduced to 0.25% (one-twelfth of 10 yr ago…).

So, of #1 and #2 above, while the whole country is waiting for more COE quotas to be released and therefore COE to crash, the govt is controlling #2 (even if #1 is left alone).

So the expected increase in COE quotas is much less than expected. It still increased, but far from what was hoped for. As a result, the COE premium will drop, but definitely not to the $10,000 level - unless the govt increases #2 again, of course… But we know the traffic jams are getting worse, so the Govt is not likely to take that risk.