Car dealers expect business to be hit as customers hold back purchases in anticipation of more COEs

CNA11-01

SINGAPORE: The planned injection of up to 20,000 Certificates of Entitlement (COEs) could hurt their business in the short term as customers adopt a wait-and-see attitude with their purchases, car ...

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When anticipating a drop in COE premiums, they would take this into account when pricing their vehicles.\n“Normally, the auto dealers will bid lower prices, because the (number of) COEs will be more (in future),” said president of the Singapore Vehicle Traders Association, Mr Neo Tiam Ting. \n“The bidding price may come down even though it is not the February 2025 bidding exercise yet,” added Mr Neo, who is also the director of car dealership ThinkOne.\nAgreeing, Mr Loo said: “Customers normally do not fully care about COE prices but they will look at the full transaction price of the vehicle.\n“Thus, a lower (COE) price buffered into the asking price will result in consumers enjoying lower prices overall.”\nBut car dealers holding on to second-hand cars will likely suffer losses, Mr Neo said. \n“If COE prices come down, their (second-hand) car prices will also go down, so in this interim period, they may suffer with their existing stock on hand,\" he said. \"But going forward, they can buy (second-hand cars) at lower prices.\" \n\n\n\n\n\n\n\n\n\n\n\n\n\nCAR DEALERS HOPE FOR MORE INFORMATION \nMore details on when the COEs will be introduced will be helpful for potential customers, said the car dealers. \nLTA said the COEs will be injected progressively over “the next few years” but did not give a set timeline. \nSaid Mr Neo from Prime: “The numbers have to be more specific – how are they going to distribute (the additional COEs)?\n“If the 20,000 is distributed throughout three years till 2027, the increase is quite substantial and sufficient to support COEs to fall below the S$100,000 mark,” he said. \n\"If the distribution is for five to six or seven or even eight years, the increase is negligible,” said Mr Neo. \nHe added that consumers are the ones losing out if they do not have the information to plan their future vehicle purchases. \n“Consumers need to know, in the next three years or so, what are the numbers – cannot buy a car today (with a COE) of S$115,000, and in the next quarter, (with the COE increase), prices drop to S$85,000,” he said.\n“Consumers will hope to have more transparency.” \n\n\n\n\nLONG-TERM BENEFITS FOR CAR DEALERS AND CUSTOMERS\nIn the longer term, car dealers expect a boost in sales when up to 20,000 more vehicles are allowed to hit the roads. \n“If there is an increase of 20,000 (vehicles), that will create more opportunity,” said Mr Neo from Prime. \n“From the business perspective, banks, showrooms, salesmen, everybody upstream and downstream will have extra business to do.” \nAgreeing, Mr Loo said that he hopes this will mean better business on the horizon. \n“Without this news, we expected only that (set) amount of transactions every year, so right now, increasing the number of transactions will help us.”","kind":null,"is_publish_news":true,"is_publish_highlight":false,"is_publish_live":false,"is_publish_wemedia":null,"editions":null,"column":"","sentiment":"0","news_tag":"","news_rank":0,"symbols":[],"gpt_button":1},"commentList":[],"isCommentEnd":true,"newsSizeData":{"likeSize":0,"commentSize":0,"repostSize":0,"favoriteSize":0,"likeStatus":false,"favoriteStatus":false},"APP":{"userAgent":"Mozilla/5.0 AppleWebKit/537.36 (KHTML, like Gecko; compatible; ClaudeBot/1.0; +claudebot@anthropic.com)","isDev":false,"isTTM":true,"deviceId":"web-server-community-laohu8-v3","version":"4.29.1","shortVersion":"4.29.1","platform":"web","vendor":"web","appName":"ttm","isIOS":false,"isAndroid":false,"isTiger":false,"isTHS":false,"isWeiXin":false,"isWeiXinMini":false,"isWeiBo":false,"isQQ":false,"isBaiduSwan":false,"isBaiduBox":false,"isDingTalk":false,"isToutiao":false,"isOnePlus":false,"isHuaWei":false,"isXiaomi":false,"isXiaomiWebView":false,"isOppo":false,"isVivo":false,"isSamsung":false,"isMobile":false},"href":"/m/news/2480095541"}