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Singapore to stop adding cars to the roads from February 2018

PUBLISHED : Monday, 23 October, 2017, 10:53pm
UPDATED : Tuesday, 03 July, 2018, 8:22pm

Singapore, one of the world’s most expensive places to own a vehicle, will not allow any growth in its car population from February, citing the small city state’s land scarcity and billions of dollars in planned public transport investments.

The Land Transport Authority (LTA) said it was cutting the permissible vehicle growth rate in the city state to 0 per cent from the current 0.25 per cent per annum for cars and motorcycles. The rate will be reviewed in 2020.

Singapore tightly controls its vehicle population by setting an annual growth rate and through a system of bidding for the right to own and use a vehicle for a limited number of years.

It is one of the most densely populated nations on the planet and already has an extensive public transport system.

Currently, 12 per cent of Singapore’s total land area is taken up by roads, according to the LTA.

“In view of land constraints and competing needs, there is limited scope for further expansion of the road network,” it said.

Singapore’s population has risen nearly 40 per cent since 2000 to about 5.6 million. The government counted more than 600,000 private and rental cars on its roads last year. These include cars used by drivers who work with ride-hailing services such as Grab and Uber, which are becoming increasingly popular.

A mid-range car in Singapore can typically cost four times the price it would in the US.

Singapore requires car owners to buy permits – called Certificates of Entitlement – that allow holders to own their vehicles for 10 years. These permits are limited in supply and auctioned monthly by the government. At the most recent offering last week, the permit cost S$41,617 (US$30,563) for the smallest vehicles.

The LTA said the zero-growth target will affect vehicles in Categories A, B and D under its permit system – these include cars and motorcycles. The existing vehicle growth rate of goods vehicles and buses will remain at 0.25 per cent per annum until March 2021 to give businesses time to improve the efficiency of their operations and reduce the number of commercial vehicles they require, the LTA said.

Singapore has expanded its rail network length by 30 per cent and added new routes and capacity in its bus network. The government will continue to invest S$20 billion in new rail infrastructure, S$4 billion to renew, upgrade and expand rail operating assets, and another S$4 billion in bus contracting subsidies over the next five years, the LTA said.

The LTA will keep the growth rate for goods vehicles and buses at 0.25 per cent until the first quarter of 2021.

Additional reporting by Bloomberg