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<TABLE border=0 cellSpacing=0 cellPadding=0 width=452><TBODY><TR><TD vAlign=top width=452 colSpan=2>Published April 8, 2010
</TD></TR><TR><TD vAlign=top width=452 colSpan=2>COE premiums rise, dealers grit teeth
Open category at 11-year high as fallout from reduced quotas kicks in
By SAMUEL EE
(SINGAPORE) There was no panic - just pain - say some motor distributors in describing the bidding action during yesterday's COE tender, the first to feature a new and sharply reduced quota.
<TABLE class=picBoxL cellSpacing=2 width=100 align=left><TBODY><TR><TD>
</TD></TR><TR class=caption><TD></TD></TR></TBODY></TABLE>As expected, premiums for the smaller supply of certificates of entitlement climbed strongly across the board. Category A - for cars below 1,600cc - rose $5,612 or 19.8 per cent to $34,001, while Cat B - for cars above 1,600cc - surged $9,412 or 26.1 per cent to $45,501.
Cat E - the open category - shot up by $6,999 or 16.7 per cent to $49,000 - an 11-year high.
Cat C - for commercial vehicles - increased $3,621 or 11 per cent to $36,511, while Cat D - for motorcycles - inched up $21 to $1,221.
Following the spikes, market leader Toyota has raised the prices of its Cat A models by $6,000, while Cat B models are now $10,000 higher.
But yesterday's premium increases seem to have moderated somewhat from the wild jumps of the preceding tender, except for Cat B, which rose by almost the same quantum as a fortnight ago.
'The amounts are slightly on the high side but not unexpected,' said the sales manager of a multi-brand dealership. 'It is only natural that the premiums go up because of the smaller quota.'
From this month until July, there will be an overall 28 per cent drop in the number of COEs available each month because of lower deregistrations in the latter part of 2009.
In particular, there are 39 per cent less Cat A COEs (1,395 per month), 20 per cent fewer Cat B (1,099 COEs a month), and a 38 per cent reduction in Cat E (720 per month).
Together, these three categories which can be used to register passenger cars will shrink by a third to 3,214 COEs a month.
In the face of the impending cuts, the COE tender a fortnight ago had seen frenzied bidding, with premiums soaring by unprecedented amounts.
When that happened, dealers jacked up their car prices accordingly but the substantial increases resulted in near empty showrooms.
'Leng Kee Road was a ghost town last weekend despite the launch of a few new models,' said one salesman.
'There were only a handful of new car bookings. If not for the top-ups, the Cat A premium would surely not have increased by so much.'
Some customers of popular dealerships who were previously unsuccessful in securing a COE had been asked to 'top up' or pay more for their cars.
'With the top-up exercise, the distributors had a bigger margin to bid for COEs,' explained the salesman.
The boss of a mid-sized dealership said paying so much for a COE was 'painful', especially for those number of orders collected a couple of months earlier but have not been fulfilled.
'Bidding was a very painful process,' he said. 'Premiums are so high that my profit margins have disappeared.'
</TD></TR></TBODY></TABLE>
</TD></TR><TR><TD vAlign=top width=452 colSpan=2>COE premiums rise, dealers grit teeth
Open category at 11-year high as fallout from reduced quotas kicks in
By SAMUEL EE
(SINGAPORE) There was no panic - just pain - say some motor distributors in describing the bidding action during yesterday's COE tender, the first to feature a new and sharply reduced quota.
<TABLE class=picBoxL cellSpacing=2 width=100 align=left><TBODY><TR><TD>
</TD></TR><TR class=caption><TD></TD></TR></TBODY></TABLE>As expected, premiums for the smaller supply of certificates of entitlement climbed strongly across the board. Category A - for cars below 1,600cc - rose $5,612 or 19.8 per cent to $34,001, while Cat B - for cars above 1,600cc - surged $9,412 or 26.1 per cent to $45,501. Cat E - the open category - shot up by $6,999 or 16.7 per cent to $49,000 - an 11-year high.
Cat C - for commercial vehicles - increased $3,621 or 11 per cent to $36,511, while Cat D - for motorcycles - inched up $21 to $1,221.
Following the spikes, market leader Toyota has raised the prices of its Cat A models by $6,000, while Cat B models are now $10,000 higher.
But yesterday's premium increases seem to have moderated somewhat from the wild jumps of the preceding tender, except for Cat B, which rose by almost the same quantum as a fortnight ago.
'The amounts are slightly on the high side but not unexpected,' said the sales manager of a multi-brand dealership. 'It is only natural that the premiums go up because of the smaller quota.'
From this month until July, there will be an overall 28 per cent drop in the number of COEs available each month because of lower deregistrations in the latter part of 2009.
In particular, there are 39 per cent less Cat A COEs (1,395 per month), 20 per cent fewer Cat B (1,099 COEs a month), and a 38 per cent reduction in Cat E (720 per month).
Together, these three categories which can be used to register passenger cars will shrink by a third to 3,214 COEs a month.
In the face of the impending cuts, the COE tender a fortnight ago had seen frenzied bidding, with premiums soaring by unprecedented amounts.
When that happened, dealers jacked up their car prices accordingly but the substantial increases resulted in near empty showrooms.
'Leng Kee Road was a ghost town last weekend despite the launch of a few new models,' said one salesman.
'There were only a handful of new car bookings. If not for the top-ups, the Cat A premium would surely not have increased by so much.'
Some customers of popular dealerships who were previously unsuccessful in securing a COE had been asked to 'top up' or pay more for their cars.
'With the top-up exercise, the distributors had a bigger margin to bid for COEs,' explained the salesman.
The boss of a mid-sized dealership said paying so much for a COE was 'painful', especially for those number of orders collected a couple of months earlier but have not been fulfilled.
'Bidding was a very painful process,' he said. 'Premiums are so high that my profit margins have disappeared.'
</TD></TR></TBODY></TABLE>
