https://www.asiaone.com/singapore/g...erral&utm_campaign=A1+trending&utm_content=c1
singapore
The authorities will instead continue to increase the COE quota for cars and commercial vehicles every quarter until the supply peaks from 2026.
PHOTO: AsiaOne/Jasper Lim
PUBLISHED ON March 05, 2025 5:51 PMByKok Yufeng
SINGAPORE — After more than a year of careful study and several debates in Parliament on the matter, the Government has ultimately decided not to carve out a separate Certificate of Entitlement (COE) category for private-hire cars owned by businesses.
"We have studied this carefully and decided not to proceed with such a move," said Senior Minister of State for Transport Amy Khor during the debate on her ministry's budget on March 5.
Instead, the authorities will continue to increase the COE quota for cars and commercial vehicles every quarter until the supply peaks from 2026, Dr Khor said.
This will be done by bringing forward COEs that are guaranteed to expire in future peak supply years to fill the present supply troughs.
An injection of 20,000 additional COEs over the next few years, enabled by evolving travel patterns and the roll-out of the next-generation Electronic Road Pricing system, will also boost supply, she added.
Dr Khor was responding to Lim Biow Chuan (Mountbatten), who asked whether the authorities would create a separate private-hire car COE category and introduce other measures to manage premiums.
While he gave credit to the Land Transport Authority (LTA) for the steps it has taken so far, including the recent ban on selling private-hire cars to individuals for three years after registration, Lim said the rising COE cost has been a source of great unhappiness for many young couples aspiring to buy a car.
The high premiums have also been blamed as a reason for the increased cost of living in Singapore, he added.
In January 2024, Transport Minister Chee Hong Tat said he did not rule out the idea of a separate COE category for private-hire cars, but the trade-offs would have to be studied carefully.
He said the proposal would be looked at as part of a review of the point-to-point transport industry, comprising the taxi and ride-hailing sectors, which the LTA embarked on in November 2023.
Giving an update on this on March 5, Dr Khor cited the same considerations that the Government had given before about why creating a separate COE category for private-hire cars would be difficult.
First, she noted that business-owned private-hire cars make up a relatively small proportion of successful car COE bids, with the bulk of the demand coming from local individuals.
At the Feb 19 tender, business-owned private-hire cars made up six per cent of successful bids for the Category A COE, which is for smaller, less powerful cars; and eight per cent of successful bids for Category B, meant for larger, more powerful cars.
Second, creating a separate private-hire car category would require reducing the quota of existing COE categories to provide the quota needed for the new category, Dr Khor noted.
With demand for private-hire cars varying from quarter to quarter, she said it is difficult to accurately determine the amount of COEs that will need to be reallocated to meet the needs of point-to-point drivers and passengers.
"If we move too much quota away, Cat A and B COE prices will spike because of inadequate remaining quota. Conversely, if we move too little, COE prices for PHCs (private-hire cars) will be high, with drivers and commuters facing higher rental and fares," she added.
"Therefore, the allocation between PHCs and private cars is best left to the market."
The idea for a separate COE category for private-hire cars has been floated by industry observers for years now. Comparisons have been made with how taxi companies have not had to bid for COEs since 2012, with their certificates drawn from the quota of the Open COE category instead.
The proposal for a separate category gained more traction after COE premiums shot up in 2022 and 2023, peaking at $106,000 for Category A and $150,001 for Category B.
While some observers pointed to demand from car-leasing companies as a factor behind the soaring premiums, this has been refuted by the transport authorities.
According to LTA statistics, the number of private-hire vehicle registrations has been rising every year since 2021.
At the end of 2024, there were 90,383 private-hire cars on the roads here, making up 13 per cent of the total car population. These include vehicles that are used for ride-hailing, as well as rental and car-sharing services.
In comparison, there were 67,990 private-hire cars at the end of 2021. This was about 10.5 per cent of the overall car population then.
singapore
Govt decides to not have separate COE category for private-hire cars
The authorities will instead continue to increase the COE quota for cars and commercial vehicles every quarter until the supply peaks from 2026.
PHOTO: AsiaOne/Jasper Lim
PUBLISHED ON March 05, 2025 5:51 PMByKok Yufeng
SINGAPORE — After more than a year of careful study and several debates in Parliament on the matter, the Government has ultimately decided not to carve out a separate Certificate of Entitlement (COE) category for private-hire cars owned by businesses.
"We have studied this carefully and decided not to proceed with such a move," said Senior Minister of State for Transport Amy Khor during the debate on her ministry's budget on March 5.
Instead, the authorities will continue to increase the COE quota for cars and commercial vehicles every quarter until the supply peaks from 2026, Dr Khor said.
This will be done by bringing forward COEs that are guaranteed to expire in future peak supply years to fill the present supply troughs.
An injection of 20,000 additional COEs over the next few years, enabled by evolving travel patterns and the roll-out of the next-generation Electronic Road Pricing system, will also boost supply, she added.
Dr Khor was responding to Lim Biow Chuan (Mountbatten), who asked whether the authorities would create a separate private-hire car COE category and introduce other measures to manage premiums.
While he gave credit to the Land Transport Authority (LTA) for the steps it has taken so far, including the recent ban on selling private-hire cars to individuals for three years after registration, Lim said the rising COE cost has been a source of great unhappiness for many young couples aspiring to buy a car.
The high premiums have also been blamed as a reason for the increased cost of living in Singapore, he added.
In January 2024, Transport Minister Chee Hong Tat said he did not rule out the idea of a separate COE category for private-hire cars, but the trade-offs would have to be studied carefully.
He said the proposal would be looked at as part of a review of the point-to-point transport industry, comprising the taxi and ride-hailing sectors, which the LTA embarked on in November 2023.
Giving an update on this on March 5, Dr Khor cited the same considerations that the Government had given before about why creating a separate COE category for private-hire cars would be difficult.
First, she noted that business-owned private-hire cars make up a relatively small proportion of successful car COE bids, with the bulk of the demand coming from local individuals.
At the Feb 19 tender, business-owned private-hire cars made up six per cent of successful bids for the Category A COE, which is for smaller, less powerful cars; and eight per cent of successful bids for Category B, meant for larger, more powerful cars.
Second, creating a separate private-hire car category would require reducing the quota of existing COE categories to provide the quota needed for the new category, Dr Khor noted.
With demand for private-hire cars varying from quarter to quarter, she said it is difficult to accurately determine the amount of COEs that will need to be reallocated to meet the needs of point-to-point drivers and passengers.
"If we move too much quota away, Cat A and B COE prices will spike because of inadequate remaining quota. Conversely, if we move too little, COE prices for PHCs (private-hire cars) will be high, with drivers and commuters facing higher rental and fares," she added.
"Therefore, the allocation between PHCs and private cars is best left to the market."
The idea for a separate COE category for private-hire cars has been floated by industry observers for years now. Comparisons have been made with how taxi companies have not had to bid for COEs since 2012, with their certificates drawn from the quota of the Open COE category instead.
The proposal for a separate category gained more traction after COE premiums shot up in 2022 and 2023, peaking at $106,000 for Category A and $150,001 for Category B.
While some observers pointed to demand from car-leasing companies as a factor behind the soaring premiums, this has been refuted by the transport authorities.
According to LTA statistics, the number of private-hire vehicle registrations has been rising every year since 2021.
At the end of 2024, there were 90,383 private-hire cars on the roads here, making up 13 per cent of the total car population. These include vehicles that are used for ride-hailing, as well as rental and car-sharing services.
In comparison, there were 67,990 private-hire cars at the end of 2021. This was about 10.5 per cent of the overall car population then.
