2016 May, 1st COE Bidding Exercise

[Spidey10]

Don't panic. We are just in the beginning of the abundance of COE. Looking at the age distribution, there will be around 100,000 of cars waiting to be scrapped for the next 3 years. The worst period is not over because there are still 100,000 buyers fighting for 80,000 expired COE. Once this critical period is over, we will see supply = demand. This should happen by the end of this year. All in the sideline will jump in.

 

The best year to buy is 2018/2019 because we will see 60,000 buyers (cars expiring in 2019) with 93,000 available COE released in 2018. Huat ah!

What about those who bought in 2013,14 and 15 also change car in 2018/19...taken into consideration boh?

[Heartlander]

Don't panic. We are just in the beginning of the abundance of COE. Looking at the age distribution, there will be around 100,000 of cars waiting to be scrapped for the next 3 years. The worst period is not over because there are still 100,000 buyers fighting for 80,000 expired COE. Once this critical period is over, we will see supply = demand. This should happen by the end of this year. All in the sideline will jump in.

 

The best year to buy is 2018/2019 because we will see 60,000 buyers (cars expiring in 2019) with 93,000 available COE released in 2018. Huat ah! 

From the chart, the best to buy would be this year, latest next year. By 2018 if you are still without a new car, panic would have set in and drive the price up already.

[Carbon82]

Don't panic. We are just in the beginning of the abundance of COE. Looking at the age distribution, there will be around 100,000 of cars waiting to be scrapped for the next 3 years. The worst period is not over because there are still 100,000 buyers fighting for 80,000 expired COE. Once this critical period is over, we will see supply = demand. This should happen by the end of this year. All in the sideline will jump in.

 

The best year to buy is 2018/2019 because we will see 60,000 buyers (cars expiring in 2019) with 93,000 available COE released in 2018. Huat ah! 

Theoretical YES. But who would have thought of Uber, Grab and such to affect the COE premium by this much, just a year ago? And below are 2 other points to consider.

 

Social Factor

Like it or not, NO thanks to the MAS 50% downpayment ruling, the trend now seems to point to more leasing and co-ownership (e.g. car sharing, short term rental, etc.), and business operators confirm have higher purchasing power than individual, thus shall bid at any level they are comfortable with. And for those that need a car, as long as they can afford to pay for monthly leasing or rental cost, why not?

 

Political Factor

So sad that many are still not getting the hint of a negative vehicle growth rate in years to come. Our government has been publizing about "Car-Lite City / Society" for sometime, and it shall be no surprise if they annouce a 0% growth rate from 2017, -0.25% in 2019 and so on, all for the name of a more environemntal friendly city (read Singapore is one of the many countires that signed the Paris Agreement recently).

[Ben5266]

What about those who bought in 2013,14 and 15 also change car in 2018/19...taken into consideration boh?

As you phrase it correctly. They change car. One to one exchange. No pressure on the demand.

[Smeagol]

bloody hell.... for cat A, supply increase, demand reduced, price up... what kind of logic is that? think I can throw my Economic 101 to dustbin liao....

 

The part about demand reduced, I'm not so sure about that.

 

As many have mentioned before, as much as there are many de-registrations, they will be a corresponding demand by those who de-registered to buy a new car (assuming they can afford downpayment). PIs are not bidding the real amount of COEs for the orders they have on hand, hence the number of bids during each COE bidding exercise does not reflect the true demand at that point in time. Based on the number of bids against the quota each month, there has consistently been much higher demand the actual supply.

 

As much as the Government is trying to promote having a car-lite society, and improving infrastructure and building more train lines, encouraging Uber and Grab to provide a taxi-alternative, at the end of the day, nothing  beats having your own transport at your convenience (and we're not even talking about the perceived prestige/ social status of having your own car). This convenience is intangible and invaluable, which explains why so many people still yearn to be car owners. This is likely why demand for cars will never be lower than the supply.

[valian]

As you phrase it correctly. They change car. One to one exchange. No pressure on the demand.

 

If their existing car is not scrapped or exported, it's +1 for demand, as the existing is still on the road no?

[Smeagol]

I bought my accent at 90k nett with 61k coe. Now accent is selling for $85,699 with 42k coe rebate...

 

Makes no sense sia.

 

Interesting, either the dealer made a large sum on your purchase, or they are currently selling the accent at a large discount maybe they are launching a new model.

 

I bought my Vezel in Jan'15 for 112k at 61k coe, current price is about 98-100k, coe about 47k. Looks like the car body price of Vezel has been relatively stable over the year.

[Ivan_06]

Interesting, either the dealer made a large sum on your purchase, or they are currently selling the accent at a large discount maybe they are launching a new model.

 

I bought my Vezel in Jan'15 for 112k at 61k coe, current price is about 98-100k, coe about 47k. Looks like the car body price of Vezel has been relatively stable over the year.

My coe rebate was 67k back then.

 

New accent only coming in 2017. I bought mine in 2015.

Edited May 6, 2016 by Ivan_06

[Axela72]

provided there is no such intervention again.

 

btw, early this year, whom with the right mind can anticipate there is such Uber things come into the play?

 

So in another words, what made us guarantee that after this year, there wont be another similar intervention materialized?

 

Just my thoughts.

Coe should and will stablize ard 40k after Uber and grab are done with their buying spree this year.

For next year. Coe might fall to 30s

 

Edited May 6, 2016 by Axela72

[Ivan_06]

As you phrase it correctly. They change car. One to one exchange. No pressure on the demand.

No you are wrong. They are going to sell off their cars while getting new rides along with new COEs...

 

Add more pressure to demand.

 

No way would they scrap cos selling will always bring in more money.

[Alpine6]

Excerpts from Business Times about yesterday's COE.  Some key points:

 

1) One AD was expecting COE premiums to go higher,if not for the economic uncertainties

 

2) A 'well-known' private hire company has eased back on its COE bidding this time

 

The increases were expected despite the new and bigger COE quota, said the sales director of a luxury dealership, given the strong orders collected at the recent TheCars@Expo sales event.

Nicholas Wong, the general manager of authorised Honda distributor Kah Motor, said that although the higher passenger-car premiums were not a surprise, he was relieved that their increases were tempered, probably by the uncertain economic outlook.

"Perhaps because the economy is not doing so well, that has dampened demand for Cat A and Cat B, which would have risen more if the economy was good and there had been no quota increase," he said.

But Cat E fell instead. Unlike for Cat A and B, this category of COEs is transferable and is often taken as an indication of future demand.

However, the managing director of a mid-sized Japanese dealership said that this time, it was unlikely to point to expectations of changing sentiment going forward.

"There was an unusually high number of open COEs this round because more than 200 pieces were carried over from the previous tender," he said.

There were 750 Cat E COEs up for grabs on Thursday, 46 per cent more than the number that would have been normally set aside.

The excess was from previously unsuccessful bids, which originated from a well-known private-hire company.

The managing director said that the company had adopted a relatively low profile on Thursday, picking up only about 90 Cat E COEs, compared with the mixed bag of more than 500 pieces it had snapped up in the past month alone.

[JiangQi]

Agreed. That's still not counting car dealers who have received orders but did not put in bids and people are still waiting on sidelines to order their cars. I have 2 colleagues who are in the latter group...

Today (06/05/2016) zaobao news 《中小型和大型车组拥车证成价都上扬 车商：价格有望回落》 wrote:

http://www.zaobao.com/news/singapore/story20160506-613505

【新加坡车业公会第一副会长陈侠发受访时指出:“。。。由于私人出租车业者上期极力抢标，好些车商这回决定采取观望态度，没有进场，这对整体需求造成一定影响。”】

Please note that 【好些车商这回决定采取观望态度，没有进场】(many ADs/PIs decided to wait-and-see)。

It may cause the number of bid less.

[Enye]

Nap? Troll? HAHAHA! i where got so free come here to troll? Why not we see today's bidding and see if coe will CRASH BIG BIG, then we will see who is "napping" and trolling lor..??    

 

 

 

 

come come, i am confident today's coe bidding gonna crash... below 10k coe come liao.... *waiting patiently*..     

 

your own exact words

 

 

[Sdf4786k]

after all that has being said and done. More would have being said then done.

 

I supposed the no one going to look or moderate the COE because it is now sort of a cowboy town.

 

Those that can afford to.. buy .. those cannot afford to...

subscribe to carlite for face saving and add to the support list.

 

with the many other transports issue in questions, the COE component will be the last thing on the radar so to speak. COE would be best left to its own device.

 

It is evolving and no intervention is required unless the big players are affected.

 

As in the case of the COE affecting sales volume of Cat A and Cat B where some distributors cannot catch up to the technology advancement of the cars.

 

I would rather LTA not intervene in the 130 BHP cap and let market forces rule the day and intervene when the COE rise was getting out of hand.

 

At one stage, many rush in with the idea that LTA would cramp down on 2nd car in a family situation. We know now that some got burn. Some got hi gong in this possible scenario with kangchong remorse.

Edited May 6, 2016 by Sdf4786k

[JiangQi]

I watched channel 8 news tonite.. got someone said uber n grab taxi should hv their category, not bid tgt with consumers..so tt coe will come down.. sth like tt???

Here is the link:

http://www.channel8news.sg/news8/singapore/20160505-sg-coe-reax/2759552.html

【国大土木工程系教授李德纮则表示：“极有可能它就会排挤掉一些真正有用车需求，而且是为着个人用车

需求的竞标者，借由加入私人出租车的行列，而满足大家拥车的欲望，跟我国现行的、长远的减少用车

政策的呼声是有所抵触的。”

新加坡车业公会会长林雅保说：“或许陆路交通管理局可以考虑，私人出租车不需要竞标，像德士一样，

没有私人出租车来投标，拥车证就会比较平稳，不会攀高。”】

[Char]

Ubor only bid 80 CAT E , PI and AD also never bid all thier orders .... For the coming bidding very depend on the new order . Backlog quite huge and hopefully no more new like confort also want to bid ....

[EWander]

Not sure about the cash part. But dont many ppl like to commit to big purchase and later complain no money?

 

To be honest, can't really say the COE bids are decided by dealers and PIs. Once you sign that purchase contract, you are telling the dealers and PIs. I want to buy this car and willing to pay this much. Go bid for me. If they bid too low, GG no car then kanna screwed by the buyers.

 

Wa non-guaranteed? Which dealer?

Well that's the reason I take non-G becos altho we r set into this COE system without much choice.(dun like to b manipulated to a certain extent) Non-G Kia...

[Kxbc]

my prediction for May's 2nd COE bidding.

 

Cat A, B and E: Same level as May 2016 1st bidding.