CEVS ....

[Wt_know]

CEVS = dealer profit margin ... period.

[Docomospur]

Maybe Honda Vezel Hybrid will also be under A1? I think it's quite a good looking ride, but you have to go the PI route for now.

[Sturtles]

Thanks. Not much choice available though.

 

CT200h seems to be a good buy then amongst the list.

 

The BMW i8 will help maximize your 30k rebate... The other cars in the list have too low an OMV

[titarium]

Quoting from One Motoring : http://www.lta.gov.sg/content/ltaweb/en/roads-and-motoring/owning-a-vehicle/costs-of-owning-a-vehicle/tax-structure-for-cars.html

 

 

CEV Rebate : "Cars with low carbon emissions will qualify for rebates, which are offset against the car's ARF payable.

 

 

Vehicle OMV ARF Rate

First S$20,000 100%

Next S$30,000 140%

Above S$50,000 180%

 

 

During Deregistration :

Age at Deregistration (year) PARF Rebate
Not exceeding 5 75% of ARF paid

5-6 70% of ARF paid

6-7 65% of ARF paid

7-8 60% of ARF paid

8-9 55% of ARF paid

9-10 50% of ARF paid

 

 

Example

Car X

Selling Price 100k

OMV 20k

CEV Rebate = 5 k

At 10th Year Deregistration = 15k * 50% = 7.5k

 

Car Y

Selling Price 105k

OMV 20k

CEV Rebate = 0 k

At 10th Year Deregistration = 20k * 50% = 10k

 

Car Z

Selling Price 100k

OMV 20k

CEV Rebate = 0 k

At 10th Year Deregistration = 20k * 50% = 10k

*pay more petrol compare to Car X

 

So basically with CEV pay lesser get back also lesser, there's always a return path back to Source

Edited February 24, 2015 by titarium

[Andyngps]

i agree with LTA reply ... the intent and logic is right

 

IF .... sibei huge IF dealers do not raise car prices.

 

however, even a 3 years old kid will know dealer will raise car prices ... double confirmed!

 

 

either LTA is living in a cave or they are super NAIVE to come up with this statement

competition ... what competition

every single car brand there is only 1 ... 1 and only 1 authorised dealer

 

Cos to lta, if you are a 1.6l car....all are the same....mazda 3...altis...civic...lol...

[Turtlekar]

Car price going north again, govt taking back e rebate.....Huat lah

[ER-3682]

S'pore most easy source of income are from car owners,import taxes,GST,road tax,petrol tax,COE,ERP,summons[this one is own fault ],CEVS...blah..blah

+ illegal modifications like tinted windows,licence plates,exhausts...[most owners knew it is an offence,but still do it]

Better than to collect from Income tax & Corporate taxes..

Edited May 2, 2015 by ER-3682

[Pjkhai28]

With the revised CEVS, safe to say a hybrid fit $122k will be $92? Or dealers will pocket the money instead? Lol

[Detach8]

All I know is that when buying second hand, nobody cares about CEVS. CEVS is making my ARF higher and hence my depreciation is lower... and that is good for me in the long run.

[Reo]

All I know is that when buying second hand, nobody cares about CEVS. CEVS is making my ARF higher and hence my depreciation is lower... and that is good for me in the long run.

 

Correct - if you're buying a used car, you care about the ARF, period.

 

If you're the new car buyer, you look at the OMV (to work out all the taxes), the ARF to work out the "depreciation" and the selling price to work out how much the agent is marking up (after considering the CEVS).

 

Just like the reluctance to implement pay-as-you-bid COE, LTA (read PAP government), the AUTHORITY are implementing measure for their own good and convenience, not (or never) the consumers. LTA does not lose anything on the so-called CEVS rebates, if you don't consider the time value of money, although very often Straits Times helps to lie that it's a "rebate". On the other hand, many unaware consumers are letting the agent to sucker them by pocketing most of their ARF (by not "discounting" accordingly.

 

I advocate the go-green mentality, but not the way it is implemented because it's very often the unaware consumers who eventually get the shorter end of the stick.

[Ken138]

Reckon tons of people are confused by CEVs and that they can change accordingly to tests n batches.

They can easily get con n not get full benefits or rebates if higher indeed..

Guess another case of complex policy ... Over time will b like taxi fares, need phd to understand all the charges at different times etc.. :-)

[tyco_kia]

End of the day, CEVS is just an excuse or a "backup" plan by our dear government to ensure car prices remain the same as existing because they are predicting that a large number of cars will scrap for the next few years which means they will need to release equal amounts of COEs back into the market so that to be "fair" and "accountable".

 

Then they also do not want the affordability of the car to go down so they revise the system a bit and introduce such schemes to make sure car prices do not fall and increase the population of cars on the road. Then again, so many possibilities revolving around this CEVS thing.

[Heman75]

I found out the details from my SE and I am really confused if car buyers are actually getting any saving/advantage at all. From my understanding, the rebate is coming off the PARF value for the car. Take for example,

 

VW Mark 7 1.4 Golf

 

With the rebate

Launch price = 137k

OMV = 22k ....

CEVS rebate - 15k

In ten years, the scrap value/PARF rebate = 22k-15k = 7k x 50% = 3.5k

Depreciation of the car over 10 years = (137 - 3.5) = 133,500/10 = 13,350 per year

 

Without the rebate,

Price = 145k (Estimate)

OMV = 22k

In ten years, the scrapPARD rebate = 22k x 50% = 11k

Depreciation of the car over 10 years = (145 - 11) = 134,000/10 = 13,400 per year

 

 

Looking at the above example, there is no saving/advantage for the car buyers, depreciation remain the same. To me, it is really LPPL. LTA is very good in coming out with idea, giving rebates at no advantage to the car buyers.

 

Am I missing something here ?

you are right... purpose to mis-lead you ... so I advice my friend don't just look at the selling price ..consider CEVS. this is particularly beneficial to conti car.. make them look price competitive to non conti car and some AD don't even want to tell you this.. they just say my conti car price same as jap car .. so why buy jap car...

I challenge an AD this before and she suck thumb don't know how to answer me.. when I looking at citron Picasso diesel then..claiming 140+k is good price with all the features u wont see in Mazda 5 at 130k

[Heman75]

I think your calculation is wrong. If the car price after the 15k rebate is 137k, then the price without the rebate is 137k+15k = 152k. Not 145k.

 

The other thing is that although you calculate straight line depreciation, you did not take into account interest cost. If you buy a car at 152k instead of 137k, the acculumulated interest for the higher loan amount can add up.

 

If you take 80% loan over 7 years, the total interest for a 152k car is (0.8 x 152k) x 2% x 7 = $17,024

 

For a 137k car, it is (0.8 x 137k) x 2% x 7 = $15,344. So that is a substantial saving too.

I don't think he is wrong .. the AD will not tell you in detail how much they took off .. they will say this price is after CEV rebate.

interest should not come into picture here for a fairer comparison. have to assume fully paid in cash.

[zerobim08]

you are right... purpose to mis-lead you ... so I advice my friend don't just look at the selling price ..consider CEVS. this is particularly beneficial to conti car.. make them look price competitive to non conti car and some AD don't even want to tell you this.. they just say my conti car price same as jap car .. so why buy jap car...

I challenge an AD this before and she suck thumb don't know how to answer me.. when I looking at citron Picasso diesel then..claiming 140+k is good price with all the features u wont see in Mazda 5 at 130k

 

Back in January, when I was looking at car prices CEVS did influence my decision. Even after working out with the spreadsheet, imo it is still advantageous to have a high CEVS since this lower the initial outlay. It is much better to get 100% upfront than 50% 10 years later.

 

The one and only criterion to determine whether the car price is reasonable to always look at the gross margin/profit of the AD at the given negotiated selling price. Don't be misled by listed price since depending on the ADs there can be quite a huge gap in listed price and actual selling price.

 

e.g. at that time the Mazda3 deluxe was going for 120+ giving a gross margin of 25K which was much higher than the other jap/kor cars eventhough the car price was similar. In this case even with similar price I would still consider Mz3 expensive.

 

My evaluation is at the link below (signature)

[Mrmilktooth]

First question for buyers.. Is will you prefer 10k off list price immediately. Arf minus 10k. Or prefer list price 10k more, with arf the same as well?

 

If you prefer the former choice, I think majority will choose this option.

 

Unless u finish the 10years and scrap. The higher arf will come into the picture.

 

If not, why not get upfront discount first?

 

Disregard the fact that it's flawed by ad makan as profit margin..

[serenade]

The CEVS is just a discount given upfront to the first buyer, that is taken back from the owner at time car is scrapped.

 

If you are like me the type who drives a car for full 10 years, the only benefit is that I get to invest the $10k rebate and get some income by end of 10 years. Assuming my returns on $10k invested gets compounded at 5%, the $10k becomes $16.3k. This is just theoretical.

 

When I bought my car recently, the CEVS did not come into the picture as the monthly depreciation over the lifespan determined affordability. The $10k became a non-issue as given to me up front will be taken back at the end from me.

 

Yes agree, the authorities has introduced a zero-sum game that some dealers have taken the chance to mislead the naive.

 

My only hope is that somewhere along the line, the authorities change their mind and do not take back the CEVS rebate at the end. Highly unlikely given the money grabbing opportunists the LTA are.

[daddygalaxy]

My 2 cents......Buying car is writing off our hard-earned $....so, the lower we spend on car, the better.

 

If you intend to drive 10yrs (or 10yrs+ 5yrs or even 10yrs+10yrs):

- What is more important is to get a reliable car that can last you 10yrs (or even up to 20yrs)

- if so, the more CEVS rebate upfront, the better.

- then the so call CEVS rebate which in the end affect the PARF value (which is going to be very little) does not affect you that much.

 

If you intend to change/sell your car:

- then the PARF value is important because that will determine how much $ you get back when you do transaction.

- it might not be that bad to buy car after Jul'15 when CEVS rebate is lower....need to work out the maths

 

Bottomline: Buyer always lose $....difference is losing more or less only.....we all know who always "WIN"