COE for cars up to 1600cc and 130bhp finished 16.1 percent lower at $36,001 – the lowest since November 2010. At less than 10 minutes before bidding closed at 4pm, the premium was still at $1.
COE for cars above 1600cc or 130bhp closed 3.9 percent lower at $49,000. Open COE, which can be used for any vehicle type except motorcycles, closed 4 percent lower at $48,005.
Even though motor traders were expecting prices to soften, many were surprised by the drop in small-car premium – the sharpest in recent memory.
Mr Ron Lim, general manager of Nissan agent Tan Chong Motor, said: “One reason is that there is little or no more backlog, as the market had rushed to clear non-Euro 6 cars before Sept 1.”
He was referring to the new Euro 6 emission standard which kicked in this month. A number of cars, including some popular models, are no longer available because of the more stringent standard.
Mr Neo Nam Heng, chairman of diversified motor group Prime, said the two private-hire giants Uber and Grab “have cooled down”.
“Their fleet expansion has come to a halt since new private-hire regulations started in July. Drivers are also dropping off, and returning cars. Also, the economy is not doing well. Many expats have left.
“As I’ve said many times before, there are more than enough COEs to meet demand. And this is just the beginning. When the new VES kicks in, premiums will drop by another $10,000.”
Mr Neo was referring to the new Vehicular Emissions Scheme which starts on Jan 1. Many cars which qualify for tax rebates today will lose their rebates, and some may even attract surcharges under the scheme.
Dealers will have to absorb some of the price increase, which means they will have less margin to bid for COE.
The low small-car COE is expected to draw buyers back to showrooms in droves. But Tan Chong’s Mr Lim does not think it would lead to a COE spike.
“Without the private-hire players, things are more manageable,” he said. “Their bidding distorted real demand.”
Meanwhile, commercial vehicle COE inched upwards by 2.4 percent to end at $43,002 – higher than small-car COE. Motorcycle premium finished 53.8 percent higher at $5402 – a strong rebound after last round’s correction.
Continued demand from courier and food delivery companies may have contributed to the rise.