It’s well known that owning a car in Singapore is expensive because of the Certificate of Entitlement (COE).
For those who participated in the bidding on 5 October 2022, you were in luck as COE decreased across all categories except for Category D that’s for motorcycles.
However, during the recent open bidding on 19 October 2022, the prices went up again.
With the COE at its peak these days, one might be wondering when it would actually come down, and how it’s calculated.
Let’s find out!
TL;DR: How COE is Determined, COE Price Trends & COE Bidding Process
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How to Calculate COE
There are five COE categories under the Vehicle Quota System (VQS).
The VQS caps the number of new vehicles that can be registered and manage the vehicle population in Singapore.
| Category | |
|---|---|
| A | Car, except fully electric car, with engine capacity up to 1,600cc and Maximum Power Output up to 97kW (130bhp); and fully electric car with Maximum Power Output up to 110kW (147bhp) |
| B | Car, except fully electric car, with engine capacity above 1,600cc or Maximum Power Output above 97kW (130bhp); and fully electric car with Maximum Power Output above 110kW (147bhp) |
| C* | Goods vehicle and bus |
| D | Motorcycle |
| E* | Open – all except motorcycle |
| * You can only transfer COEs in Categories C and E once if you bid for them as an individual. If your bid is under a company, business or organisation, the COEs cannot be transferred. COEs in Categories A, B and D cannot be transferred. | |
Determining COE Prices
The VQS controls the supply and since August 2022, the supply is calculated based on a rolling average of vehicle deregistrations over two quarters (preceding six-month), instead of one quarter.
To put it simply, there will be a lesser supply of COE available if lesser people deregister their cars.
As with most things in the market, prices are determined by the demand for the product too, which refers to the number of people looking to buy new cars, with car dealers participating in the COE bidding for you.
When the COE rates are high, car prices will have to increase and this reduces demand, and when COE prices are low, dealers can afford to cut prices if they wish to boost the demand for car ownership.
COE Trend Prediction 2022
COE Price May Increase Further
If you’re wondering when the COE prices would drop, it might not happen anytime soon.
The reason is, COE prices are heavily influenced by government policies, and with how the supply of COE is calculated now, the supply shrunk by 11.5%.
The Land Transport Authority has also said that the COE quota will drop by 13.7% from November 2022 to January 2023, at a total of 9,128 COEs.
With lesser supply and assuming that the demand remains the same, COE prices will likely increase.
What Is the Highest COE Price?
The highest premium to date was in July 2022, at $114,001 for the Open Category.
Since then, the premiums have come down slightly but still remain relatively high.
When Is the Next COE Bidding?
COE bidding happens twice a month, on Wednesday at 4pm.
The next COE bidding date is on 9 November, and these are the dates for the rest of 2022:
- 23 November 2022
- 7 December 2022
- 21 December 2022
Read more:
- Buying A Car? You Need To Be Earning At Least S$8,850 First
- Sell Car Singapore Guide: Can You Actually Sell Your Car for a Profit Now?
What Is the Bidding Process of COE?
COEs are offered separately in an open bidding method for each of the various categories. Nevertheless, not all bids will be accepted.
The bid amount, also known as the reserve price, that you are willing to pay must first be entered into the system.
The bidding mechanism will then automatically raise the current COE price by $1.
If your bid is lower than the going rate for COE, you will be eliminated from the round and not be able to receive a COE.
The price of COE will then continue to rise until there are exactly as many bidders as there are COEs available, at which point it will stop rising.
The closing bid will be the Quota Premium (QP), which must be paid by the successful bidders in the same category.
How to Submit a COE Bid
To bid for a COE, you will need to follow the bidding procedure.
| COE Bidding Procedure | |
|---|---|
| Set up a Bank Account | Ensure there are sufficient funds for the bid deposit and administration fee charged by the bank, which usually ranges from $2 to $10 depending on the respective banks. Bid Deposit Category A, B, C & E: $10,000 Category: $200 (for Category D COE obtained before the March 2022 2nd bidding exercise), $800 (for Category D COE obtained from the March 2022 2nd bidding exercise onwards) |
| Bidder Identity Document (ID) | Ensure you use the correct ID for your bid |
| Indicate Reserve Price | The minimum reserve price is $1. When the Current COE price exceeds your reserve price, you must revise your bid or you will be out of the running for a COE |
| Make payment for bid deposit and administration fee | Once you have submitted your bid successfully, your bank automatically deducts the bid deposit and administration fee from your bank account |
| Receive Acknowledgement Code | You will receive a 6-digit Acknowledgement Code every time you successfully submit or revise your bid, and you can use this code to enquire about your bid or revise it |
You can submit your bid using:
- DBS/POSB ATM machines; or
- Internet banking (DBS, UOB or Maybank) – for corporate account holders only
After submitting your bid, you can check your bid status or revise your bid.
You will know if your bid is successful when the bidding results are announced.
How To Check COE Bid Status?
Login to the LTA Open Bidding Website and follow these steps:
- Step 1: Select ‘Individual’ or ‘Company’ for the Bidder Type and key in your bank account ID. For ‘Company’ bidders, key in your latest ‘Acknowledgement Code’. Then key in the characters shown in the Character Verification Image (CVI). Click ‘Proceed’ to continue;
- Step 2: Click ‘I Agree’ to agree with the Terms and Conditions;
- Step 3: The screen will display the current COE information and the status of your bid. Under ‘Current Bid Status’, you will see ‘Out-bid’ or ‘Accepted’. ‘Out-bid’ means that your existing bid is no longer in the running for a COE as the Current COE Price is higher than your reserve price. ‘Accepted’ means that your bid is still in the running for the COE.
How to Revise COE Bid?
If your reserve price is lower than the Current COE price, you have been outbid. So, you will need to increase your bid to stay in the running for a COE in the current exercise, or you can participate in a different bidding in the next round.
Bids must be raised in multiples of $1. A new Acknowledgement Code will be given to you for each accepted revision.
Before the bidding process is over, you are free to make as many adjustments as you’d like. However, you must pay an administration charge to the bank for each revision.
What Happens After a Successful Bid
A Temporary COE will be granted to you once you win a bid (TCOE).
The TCOE is valid for 3 months for Categories C, D, and E, and for 6 months for Categories A, B, and D (for Category D TCOE obtained prior to the March 2022 2nd bidding exercise).
Prior to the expiration of your TCOE, you must register your car.
You will lose your whole bid deposit if the TCOE expires, at which point it can no longer be used. If you place an individual bid for Categories C and E, you are permitted to transfer TCOEs once.
Will You Get a Car in Singapore?
We know that a car can be notoriously expensive in Singapore, so there are alternatives such as ride-hailing, car sharing, and car rental available.
Being a car owner is a huge commitment, and you’ll be required to have car insurance and a car loan amongst other things, so always ensure that you are committing to what you can!
Have a question on COE bidding? Ask away in the Seedly Community!
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