COE conspiracy theory

[Pool100]

Is there some kind of conspiracy theory behind the recent COE crash to $5200?

 

Of course we can all say it's all linked to $$$ but it just doesn't make sense to me.

 

For that round of bid, there were 2823 bids for 2670 COEs. That means, there were 153 bidders who were not willing to bid more than $5200. (a bit silly considering the average range has been 10-12K over the past year).

 

And what got me thinking was why some dealers didn't put in bids for their customers, even though COE was so freaking low. i.e, they could have secured COEs at $5201, $5300 or $5XXX had they placed the bid in. Why wait? Were they hoping that COE would even DROP FURTHER? highly unlikely based on historical trends. i.e COE normally rebounded right after a drop.. as proven this time round too.

 

Looking at historic figures, there were months were fewer or similar amount of bids were placed, but COE remained at 10-12K..

i.e Feb round 1 - 3005 bids, 11.8K.

Oct 2006 round 2 - 2761 bids, 12k.

 

Was it a bid to raise a car buying frenzy? probably. But doesn't make sense too since if the COE drops, they have to lower car prices too. But then they have to secure future COEs at higher rates using lowered car prices. Poor business decision IMO.

 

And by the way, for the 153 bidders who failed to get their COEs during the $5200 crash, they must be kicking themselves because it's almost impossible for COE to drop below that level in the near future. that means they'll have to fork out more in future rounds to secure COEs for their customers. Another poor business decision again IMO.

 

So what's the deal?

[Wt_know]

it's normal for someone who 'dream' that they can strike by putting very low COE even $1

[Pool100]

But what's the deal with dealers not putting in bids for their customers even though COE was so low? I have a couple of friends who didn't get their COEs even though loans have been approved.

[Paddie]

Don't forget that every COE bid carries an immediate deposit of $10,000. Some dealers might just not have budgeted to place more than X bids during that bidding exercise, and by the time they realised it was going to crash (only 10-15 minutes before closing) it might have been too late.

[Fongs]

For those who didnt get COE despite the drastic drop to 5.2k, my guess is, dealer maybe unwilling to rebate any difference in COE prices to buyer. eg. if COE rebate is capped at $6k, dealer will need to rebate $6k - $5.2k = $800

 

Dealer maybe playing a mind game with the buyer. Now tat COE prices hv gone back up, they may request for topup to get immediate (CAT E). Who doesnt want to earn more??

 

IMO, the last round of COE crash is a FAT bonus to the dealers, not the buyers. Imagine u get back $800 as rebate, your car paper value already lost few k.

[Wt_know]

high or low COE the one who benefited it is the CAR DEALER .... PERIOD !

 

as car buyers ... we are living at the mercy of the dealer ....

 

COE low ... they said COE will rebound ... so cannot lower the price too much

 

COE sideline .... car price remain or GOES UP

 

COE goes up ... they up the price super fast

Edited March 13, 2007 by Wt_know

[Altivo]

cos it's the bidders and not the car buyers who are bidding for the COEs mah....

[Zniper]

TS, i can only tell u tat even if those 153 ppl gotten their COE at such low price and gotten some rebates from the car dealers due to tis, they will not gain anyting at the long run...

i.e

a person got a car at $43k wif coe @ $5200

and i got a vios at $46 wif coe @ $12602(current price.. tis is the fact as i got mine)

 

calculate the diff and which 1 is more worth it... tink maybe the dealer rebates u $3-5k but there is still difference in the amount of paper value and stuffs...

[Pool100]

All I know is that if the dealer gets the COE at low price, both dealer and customer will be happy. win-win situation. Dealers gets a bigger cut from his profit margin, customer gets a rebate. whether the customer is truly happy from such a deal is another matter altogether.

[Zniper]

haha, of cos wat u say is a win-win situation... but the fact is we as consumer of cos wants the best for us... so my situation is wat i like...

[Ivan78]

I guess you are thinking too much....

 

For that round itself, most dealers did not realise that the date was brought forward because of CNY, and most car dealers/agents could not deliver the car in time even if they bid for this round COE... so it was more of a case that dealers who got their COE then got a lucky bid...