It costs a record US$99,700 to buy a small car permit in Singapore

The price of a Category A certificate of entitlement (COE) meant for smaller cars and EVs advanced by 4.2 per cent in Wednesday’s bidding exercise from the previous round on June 17. Premiums for larger and more powerful cars in Category B jumped 6 per cent to S$130,889.

The surge in premiums comes ahead of the December 31 expiry of incentives given by the government to encourage EV adoption, as part of Singapore’s net zero strategy. Authorities have warned that this could lead to a temporary rise in COE premiums as buyers bring forward vehicle purchases.

“Consumers do not want to miss out on the savings and probably made up their minds to bite the bullet and jump in on the EV bandwagon,” said Say Kwee Neng, managing partner at One Strategic Consulting. “The astronomical rise in pump prices, coupled with runaway COE prices, probably pushed customers to get off the fence.”

Vehicle dealers are also stepping up promotions to clear their EV inventory, adding to demand in Singapore’s tightly controlled car market, said Victor Kwan, an automotive analyst and associate professor at the Singapore University of Social Sciences.

Even with the impending end of the EV incentives, Singapore’s electrification transition is unlikely to reverse, analysts said.