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1994: The one and only time COEs hit S$100,000 FRI, APR 08, 2022 - 1:07 PM MATTHEUS WEE THE angry Facebook reacts are out in full force. The fear is starting to creep in. On the lips of observers all around, the same question is starting to form: Will COE premiums hit S$100,000? To be more accurate, that question was already floating around on Wednesday (Apr 6), as it also was 2 Wednesdays ago. We know how both eventually panned out, though. Cat B and Cat E ultimately didn't cross the dreaded 6-figure line, although as some sort of perverse inside joke, the latter levelled out at S$99,999 yesterday (What is this? A twisted version of the Great Singapore Sale?). The former, on the other hand, dropped slightly - by S$500. It's to be expected that many of us will gawk at the numbers now, but some (probably) older folk will remember: They don't actually represent the highest peaks premiums have ever scaled. The events of 1994: Lead-up to 100k The lead-up to S$100,000 back then wasn't so much a sudden twist as it was a slow build, begrudgingly recognised in the papers as an inevitable culmination of prices inflating across 2 years. It's difficult to pin the phenomenon down to any single event or reason, but we can broadly focus on 2 forces acting in relation to one another. The first: Singapore's economy was booming. Without diving into an exhaustive list of what was happening, the general sensing one may get from the period is that folks were doing well financially. For example, CPF funds were liberalised for investment in 1993 (Ctrl + F "Basic Investment Scheme" here). The stock market was on a good run. And bank interest rates were low. In essence, people had the cash to spare, and more importantly, they were willing to part with it. (On a side note, there's also the fact that a spanking new initiative - called the "Goods and Services Tax" - had been recently announced for impending implementation... And at an exorbitant rate of 3 per cent too. We know what occurs when people fear an incoming price hike.) But there was another issue that cannot be ignored. Introduced as part of the Vehicle Quota System (VQS), the COE system was only 4 years old back in 1994. We grumble about it now, but there was objectively more that was wrong with it back then. Car loans at that point had yet to be restricted, meaning that one could effectively borrow close to the full amount for a car, then spread payments out over the entire 10-year period. More importantly, speculation and market manipulation was rife among distributors and dealers with deep enough pockets. For a while, this was even fine by the authorities, who were sold on the principles of free market economics. Flipping through the archives will reveal, in particular, that many believed regulations for the transference of vehicle ownership were too loose at that point. This enabled bigger market players to hoard COEs, and then bid aggressively to drive premiums skywards so that they could constantly offload their supply on hand at a profit. And so, skywards they went. In December 1994, premiums in Category 4 (for luxury cars, 2,001cc and above) reached an eventual high of S$110,500. Category 3 (for big cars, between 1,601 and 2000cc) also managed to exceed S$95,000. https://m.sgcarmart.com/articles/articleinfo.php?AID=4102&CT=e

5 Cars That Won’t Last 100,000 Miles https://www.youtube.com/watch?v=KePrK9FseGk