Weeks ago, the Government announced changes to the age-old COE system, in a bid to level the playing ground in the industry as well as to ensure a better division of COE allocation between premium and mass market cars.
Under the new implementation, banding for Category A will be tighten to cars with less than 130bhp only, on top of a 1.6-litre engine capacity. This means cars that were previously in Cat A but with more than 130bhp will be re-categorised into Cat B.
The revised banding will take effect from February next year, and will without doubt affect the local car industry. With the influx of Cat A cars that will be shifted into Cat B, the latter’s COE premium is expected to soar due to higher demand.
Assuming that premiums for Cat A take on a softer stance after the change, buyers may be attracted to model variants with lower power, and will turn to aftermarket kits to tune up the performance of their cars afterwards, as this route is more economically viable.
Models such as those from German marques Audi and Volkswagen have become the local's tuning favourites. The increasing availability of basic and fuss-free tuning options, such as ECU re-flash and chip tuning, can easily bring cars at the brim of Cat A banding, such as the base Volkswagen Golf (122bhp) and Audi A3 Sportback 1.4 (122bhp), to Cat B standards of over 130bhp.
This will likely spark new life into the aftermarket industry. But it will also make the situation unfavourable and unjust for Cat B car buyers.
As such, the Land Transport Authority (LTA) may seize the opportunity to further clamp down on illegal modifications, possibly conducting more random checks and increasing the number of enforcement officers on patrol.
Vehicle inspections would probably be more stringent as well, and in order to determine if the engine has been tuned, dyno tests could be conducted during inspections.