LTA will inject up to 20,000 additional COEs into the vehicle quota system over the next few years, but crucial questions remain
Singapore’s Land Transport Authority announced, on 2024 October 29, the progressive injection of about 20,000 additional COEs across the Categories from 2025 February over several years, but this information is sketchy for motor traders and car buyers alike.
According to LTA, this plan is similar to the Government’s addition of 10,500 COEs to the system between 1997 and 2003, on top of the allowable vehicle growth rate at the time. The authority also referred to the introduction of Electronic Road Pricing (ERP) in 1998, when the then Minister for Communications stated “As the roads become less congested, we can review our vehicle quotas and, if feasible, release more COEs” - which they did.
Today’s official justification for releasing more COEs is, again, related to ERP, but the latest 2.0 version based on Global Navigation Satellite System technology.
LTA cited the improved capabilities of the new-generation ERP (such as virtual gantries and the option of distance-based charging), evolving travel patterns (total mileage of the vehicle population is said to have decreased by around 6 percent from 2019 to 2023), and the expanded/expanding MRT network. These factors would, apparently, make the management of traffic congestion more flexible and more responsive, thus accommodating the 20,000 extra COEs.
However, LTA reiterated its ‘car-lite’ vision and highlighted that the vehicle growth rate for COE Categories A, B and D will be maintained at 0 percent per annum from 2025 February 1 until 2028 January 31.
This move by LTA puzzled some motor traders.
Sabrina Sng, managing director of Polestar and Lotus under Wearnes Automotive, told Motorist: “It’s confusing, and it contradicts the ‘car-lite’ policy.”
Nicholas Wong, chief executive officer of Honda authorised agent Kah Motor, said: “It’s very vague. How will the higher COE supply be spread? Too little information is available for now.”
Ng Choon Wee, commercial director of Komoco Motors which represents Hyundai in Singapore, commented: “How will LTA release the additional COEs? Will a fixed quantity be made known to consumers upfront, or will it be used as and when to cool the uptrending of COE premiums? Is there any clawback of these additional COEs from future deregistrations?”
At least two motor industry insiders, however, regarded the LTA announcement as good news.
Ron Lim, head of sales and marketing at Nissan authorised agent Tan Chong Motor, told Motorist: “This is definitely a positive for the market and potential car buyers. If these additiional COEs are released over two or three years, then we will see more impact.”
A senior executive at a major dealership in the Alexandra Road motor belt said: “Any increase in the COE quota is welcomed by everyone. $100k is really too much just for a COE.”
Thinking about upgrading your car after seeing the latest COE results? Motorist can help you sell your vehicle at the highest possible price. Simply click on the button below to receive an online car valuation today. This service is completely free, with zero obligations.
Claim your free car valuation today!
For those looking to renew their COE, Motorist also provides free COE renewal advice. That way, you can decide if it's a better option to scrap your vehicle or extend its life.
Here are some other resources that might be of interest:
COE Hike: Car leasing companies not main culprits in rising COE prices
COE Hike: Why Now Is the Best Time to Purchase a Used Car
COE Hike: Why It's A Good Time To Sell Your Current Car Now
Join our COE Live Results & Speculations Telegram Group
Schedule a free COE renewal consultation session!
Download the Motorist App now. Designed by drivers for drivers, this all-in-one app lets you receive the latest traffic updates, gives you access to live traffic cameras, and helps you manage LTA and vehicle matters
Did you know we have a Motorist Telegram Channel? Created exclusively for drivers and car owners in Singapore, you can get instant info about our latest promotions, articles, tips & hacks, or simply chat with the Motorist Team and fellow drivers.
