But consensus is COE supply set to expand significantly from 2nd half
According to calculations based on Land Transport Authority data, Categories A (cars up to 1,600cc) and B (cars above 1,600cc) supplies are likely to shrink further from the current low in the next six- monthly quota from February.
The Cat A supply for February to July could fall by up to 12 per cent from the 4,367 in the current six-month period (August to January). The Cat B supply could fall by 14 per cent from 4,478. The Open category of COE - which is used for any vehicle type but ends up mainly for bigger cars - could grow by up to 30 per cent from 3,129.
The total supply of COEs in the three categories is expected to inch up by no more than 2per cent from 11,972 now.
Have the privilege to admire the luxury cars lining along the Conrad Hotel parking zone during an invited lunch appointment yesterday.
Found out that it is actually Exotic Cars Club lunch gathering at Conrad Centennial Singapore Hotel.
Exotic Cars Club is an international community, which unites owners of super sport cars to give them an opportunity to meet in large international gatherings. All events are created to provide a relaxed and informal environment where people of similar interest and social class could freely and openly communicate with each other. The geography of Exotic Cars Club members’ spans from Europe to Middle East. Our professional spheres of activity and interests include mining, chemical and engineering industries, renewable energy, automotive and marine industry, I.T., banking and finance, real- estate, racing, music production, mass media, politics, fashion.
Perhaps one silver lining from the recent changes in the Cat A category is that the Prevailing Quota Premium (PQP) is likely to fall in the months ahead. There is just one more COE bidding exercise before most of the luxury cars leave Cat A. Likely then that the COE prices for Cat A will then fall in the months ahead and with it, a fall in the PQP. Good for those who have Cat A cars reaching 10 years and are still in good condition... or those intending to buy secondhand Cat A cars.
Sadly, for those with maturing cars which are over 1,600cc, the PQP for such cars are likely to go up further in the months ahead. Guess like in the stock market, when someone wins, someone else will have to lose.
I have just sold my car and will use train. If I need a car, cheaper to rent or take a taxi when there is a need. Not only the car is expensive to maintain, the insurance is shocking as well; then, when you involve in an accident, saying sorri is not enough. Have been driving all my life, mostly from home to work. After having taking train for sometime, found that it is actually good for health. Walking some distances to the train or take a bike to get work done will get some exercises needed. The car just encourages pple to be lazy. Last time, I drove to shop about 300 metres away; now thinking about it is just a waste of money and not good for health. Was thinking about getting an electric bicycle, then scrap the idea..health is more important.
The list of cars in Cat A and Cat B (following the new measures) is below.
Would not be surprised that the bidding from Feb will result in a COE for Cat A to be below $50K and that of Cat B above $100K. So many more cars in Cat B and the total number of Cat B and Open Cat has been reduced from 1268 to 1083. If one is still keen on buying a car, it may make more financial sense to look through the cars in Cat A.
If the COE for Cat A does go down significantly, your secondhand car is also likely to fetch less (as the cost of the new car will go down). This may be why the secondhand car market is so quiet lately as the second hand car dealers are smart enough not to want to take in any cars in Cat A for the timebeing.
If you are on the lookout for a Cat A car, it may be better to wait out until the COE falls. As it stands, it is difficult to buy your own COE and then get the car of your choice. So, it is better to wait for the COEs to drop and then go to the dealer who would have pegged the new car price on the lower COE price.
If you are on the lookout for a Cat B car, it may also be better to wait out .... but for a longer time as more cars are expected to be deregistered in the second half of the year. I think many car dealers are expecting the COE for Cat B to be around $120K for the first 6 months of this year.
Decided to change my wife's car as it has started giving problems in the last year. The salesman was able to give me an attractive price as they were trying to clear stocks of Cat A cars that will be moved over to Cat B next month. My rationale is that when these cars move over to Cat B, the price of the COE for Cat B is likely to go up at least in the short term and with it, the price of the Cat A car that is moving to Cat B.
Secondly, the secondhand price of my wife's Cat A car is likely to go down as the COE for Cat A is likely to fall. This will drag down the price of Cat A cars in the showroom and with it, the prices of all secondhand cars with Cat A COEs.
Looking into the distance, I think the government's objective is to keep Cat A COEs low while market forces will keep pushing Cat B COEs up. It makes sense to get a Cat A car moving to Cat B as in the future, I think the prevailing quota premium for Cat A cars will remain affordable and hence, within 10 years, one can revalidate a Cat A car. It may not be that cheap to revalidate a Cat B car in the future (unless the economy tanks which is a sure thing... just that we don't know when).
Of course, more importantly, I am not sure if we can wait 6 months as my wife's car is going to the workshop too often.
Like with stocks, time will tell if I have made the right decision.