COE Premiums Surge Across Categories – Motorcycles Remain Relatively Stable

COE Premiums Surge Despite Increased Supply, Driven by Demand and New Models

Singapore – Certificate of Entitlement (COE) premiums continued their upward trajectory in the latest tender results, defying a 6% increase in the supply of COEs for larger cars and the Open category. The surge is attributed to a significant jump in demand, outpacing the increased availability.

According to Mr. Ng Choon Wee, commercial director of Hyundai distributor Komoco Motors, the number of bids received for these COE categories rose by a considerable 12.8%, exceeding the supply increase. He noted that this demand is primarily coming from individual car buyers, with commercial fleet owners demonstrating less aggressive purchasing behavior over the past six months.

Industry experts suggest a key driver is the impending expiry of COEs for a growing number of vehicles.Mr. Lee Hoe Lone, managing director of Premium Automobiles (distributor of Avatr, Xpeng, Zeekr and Changan), explained that owners facing COE expiration will likely need to replace their vehicles, fueling demand for both new and used cars. “Unless these owners give up owning a car, they will need to buy a new – or used – one soon,” he stated.

The influx of new automotive brands into the Singapore market is also contributing to the competitive landscape. Mr. Ron Lim,head of sales and marketing at Nissan agent Tan Chong Motor,believes companies are actively vying for market share,pushing COE premiums higher.

furthermore, the recent launch of new Category B COE models from brands like BYD and Mercedes-Benz has added to the demand within that specific COE category.

The latest tender results indicate that the current increase in COE supply is struggling to keep pace with the rising demand, suggesting continued pressure on premiums in the near future.

What financing options should prospective car owners explore given the increased COE premiums?

Understanding the COE Market Dynamics in 2025

Certificate of entitlement (COE) premiums in Singapore have seen a notable upswing across most vehicle categories in recent months. However, a notable exception is the motorcycle COE, wich has demonstrated relative stability. This article dives into the factors driving these diverging trends, offering insights for potential vehicle buyers and analyzing the current COE rates landscape. We’ll cover Singapore car prices, motorcycle COE trends, and strategies for navigating the vehicle ownership costs in 2025.

Category-Specific COE Premium Increases – A Breakdown

Here’s a look at how COE premiums have shifted across different categories as of early August 2025:

Category A (Cars up to 1600cc & Electric): Premiums have surged past SGD 80,000, representing a 25% increase quarter-over-quarter.This is largely attributed to increased demand for smaller, fuel-efficient vehicles and the growing popularity of EVs.

Category B (Cars above 1600cc): Experiencing a similar upward trajectory, Category B COEs now exceed SGD 95,000. Demand for larger engine cars remains strong, particularly amongst those prioritizing performance and space.

Category C (Goods & passenger Vehicles): Commercial vehicle COEs have also climbed, reaching SGD 70,000, driven by logistical needs and business expansion.

Category D (Buses): Bus COEs have seen a moderate increase, currently around SGD 45,000, reflecting ongoing public transport infrastructure advancement.

Category E (Motorcycles): Remarkably, motorcycle COEs have remained relatively stable, hovering around SGD 10,000 – SGD 11,000. This stability is a key point for potential motorcycle buyers.

Why Motorcycles Are Bucking the Trend

Several factors contribute to the stability of motorcycle COE premiums:

1. Consistent Supply: The supply of motorcycle COEs has remained relatively consistent, preventing the drastic price increases seen in car categories.
2. Demand Plateau: While motorcycle ownership is popular, demand hasn’t experienced the same exponential growth as car ownership, particularly EVs.
3. economic Factors: Motorcycles are often viewed as a more affordable transportation option, making demand less sensitive to broader economic fluctuations compared to cars.
4. alternative Transportation: The robust public transport system in Singapore provides viable alternatives to motorcycle ownership, moderating demand.

Impact on Vehicle Buyers – What Does This Mean?

The diverging COE trends have significant implications for prospective vehicle owners:

Increased Car Ownership Costs: The surge in car COE premiums directly translates to higher overall vehicle prices. Potential buyers should factor this into their car financing options and budget accordingly.

Motorcycle as an Affordable Option: The stable motorcycle COE presents a comparatively affordable entry point into vehicle ownership. this is particularly attractive for commuters and delivery riders.

Shifting Consumer Preferences: The high COE prices may encourage consumers to consider alternative transportation methods, such as public transport or car-sharing services.

* Impact on Leasing: Car leasing costs are also likely to increase due to the higher COE premiums embedded in lease agreements.

navigating the COE Market – Practical Tips

Here are some strategies for navigating the current COE market:

1. Consider Smaller Engine cars: Opting for a car in Category A can be more cost-effective than choosing a larger engine vehicle.
2. Explore Electric Vehicle Options: While EV COEs are in Category A and experiencing demand, government incentives can offset some of the higher vehicle costs.
3. Monitor COE Trends Closely: Stay informed about COE bidding results and market analysis to identify potential opportunities. Websites like LTA (land Transport Authority) provide official data.
4. Factor in Total Cost of Ownership: Don’t just focus on the COE premium. Consider factors like road tax, insurance, fuel costs, and maintenance expenses.
5. Consider a Motorcycle: If affordability is a primary concern, a motorcycle offers a stable and practical transportation solution.

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