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The Land Transport Authority (LTA) recently announced a 42 percent increase in Certificate of Entitlement (COE) quotas for the May - July period. How do you think COE prices will move in this quarter? http://www.sgcarmart.com/news/article.php?AID=10142

And so, the LTA has announced the news that we were all expecting. The annual vehicle growth rate will be lowered from the current 1.5% to 1.0% in 2012, and then to 0.5% in 2013 and 2014. It's a topic that has been discussed previously, but the full implications of the reduction will only be known once it comes into force next year. However, LTA claims that it is unlikely to have a huge impact on COE supply (hence prices) when the measures kick in, as it expects a rise in vehicle deregistration during this period, hence balancing out the cut in growth. Whether this will pan out to be the case, remains to be seen. But it's encouraging that Transport Minister Lui Tuck Yew has been listening to feedback, and considering all viewpoints before announcing any drastic implementations, as can be seen here. Let's hope that Singapore's transport system can finally move on to become world class, whether it be public or private transport.

By now, you would have read the news that the Government is planning to reduce the vehicle population growth of Singapore. And of course, you would have known the potential implications this will have on car (and COE) prices in Singapore. It's a topic as old as the COE system itself, but it's still one that rages on regardless. I don't begrudge the Government for doing what it is doing, because let's face it, Singapore is a small country. We cannot accomodate that many cars on our roads. But it's the fickle indecision of the Government that bugs me. What do they really want to curb, ownership or usage? I wish they would make up their minds and set the true agenda, so that we can all be clear what the situation is and adapt accordingly. I personally am for curbing usage. Let people own cars, but make them think twice about driving. One way to do this is to make it inconvenient to drive into town. Not just expensive, but inconvenient and troublesome. I mean, if you are going to encounter closed roads and trouble finding (cheap) parking, wouldn't you seriously reconsider driving into the CBD? And thus cars will be free for use around the surburbs on the weekends or during off-peak hours for family or social activities. Of course, the public transport system to and from town has to be vastly improved from the current situation for this to work, so the onus is on the relevant Government bodies to think about how they want to go about implementing this effectively, if they do consider it. I'm sure people have their own opinions, so I'll be happy to hear them.

In the latest bidding exercise on 23 February, COEs for all categories posted an increase, with an average of 16 per cent rise each for the main Cat A and Cat B categories. This comes after two consecutive declines in COE prices for the previous two tenders. I suppose the rise could be partly attributed to a lull in sentiments from the previous exercises, as buyers moved in upon seeing the prices falling. Or it could be a number of other factors, as several new car sales representatives have been quoted as saying. Among them include a fall in demand during the recent Chinese New Year festive period, a rebound after the further reduction in quota that was enforced in early February, or even a reaction to the recent Budget announcement where the Government handed out "goodies" to the people as a reward for the outstanding financial year just past. Whatever it is, with the reduced quota in COEs now, it is getting harder to predict the movements of COE prices in the months ahead. I think the managing director of Audi Singapore. Reinhold Carl, summed it up best when he said, "When premiums fall, buyers will come in, which will cause premiums to rise. And then, people will stop buying, causing premiums to fall." The only thing that buyers can be sure of, however, is that the days of cheap COEs are definitely over.