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11-01-2011, 07:18 PM
Motorists, traders get a break as remaining adjustments will now be spread over 3 years
By SAMUEL EE
(SINGAPORE) The COE quota for the next six months will be cut by an unexpectedly small 3 per cent, thanks to a government concession regarding the overprojection of COEs in earlier years.
The Land Transport Authority (LTA) announced yesterday that from February to July 2011, a total of 22,368 certificates of entitlement will be released, or 3 per cent less than the 23,063 for the quota period between August 2010 and January 2011. This means 3,728 COEs per month from next month compared with 3,844 currently.
The reduction is less severe than expected because of the government's decision to allow the remaining adjustments for the overprojections of vehicle deregistrations in 2008/2009 to be spread over three years instead of one year. If the correction for the 9,577 COEs was carried out over the next 12 months instead of 36, the impact to the upcoming quota would have been greater.
Transport Minister Raymond Lim said this was in response to a suggestion by the motor trade and that LTA is prepared to do so 'to give the industry and car buyers more time to adjust'.
'These are one-time corrections, and will not affect the long-term growth in the vehicle population,' Mr Lim said in Parliament yesterday.
So, starting next month, the number of available Category A COEs (for cars below 1,600 cc and taxis) will be 1,020 per month, down 14.6 per cent from the earlier six-month quota period. Cat B (for cars above 1,600 cc) will get 847 COEs, or 11.6 per cent less.
But Cat C (for goods vehicles) gets an increase of 34.7 per cent to 551 COEs per month, while Cat D (for motorcycles) shrinks 2 per cent to 651.
Cat E (the open category) also gets a 6.6 per cent boost to 659 COEs.
The method of determining the COE quota was changed in April 2010 and it is now determined largely by the actual number of vehicles deregistered in the preceding six-month period, rather than being based on forecasts of future deregistrations. Since then, the number of Cat A and Cat B cars deregistered has been on a general downtrend as COE premiums spiked up.
'Motor traders are not overjoyed by the new COE quota but we all heaved a sigh of relief,' exclaimed the sales manager of a mass-market brand which has been hit hard by the shrinking pool of COEs.
He said he was grateful that the transport minister had accepted the industry's suggestion to spread out the remaining adjustments to the overprojected COEs.
'My job is safe for now and you should still see me around for a few more years,' the sales manager added with a laugh.
Mr Lim also said pay-as-you-bid COEs are not the solution to high premiums. He was replying to Member of Parliament Lim Wee Kiak who had suggested such a system for COE tenders.
The minister told Dr Lim, who is the chairman of the Government Parliamentary Committee for Transport, that this had been studied 'in great detail some years back' and that there were certain shortcomings. In particular, the spread of prices showed a clustering around the lowest successful bid of 'about 20-30 per cent'.
'It's not as though the highest bidder is pulling up the price,' explained Mr Lim.
Copyright © 2010 Singapore Press Holdings Ltd. All rights reserved.
By SAMUEL EE
(SINGAPORE) The COE quota for the next six months will be cut by an unexpectedly small 3 per cent, thanks to a government concession regarding the overprojection of COEs in earlier years.
The Land Transport Authority (LTA) announced yesterday that from February to July 2011, a total of 22,368 certificates of entitlement will be released, or 3 per cent less than the 23,063 for the quota period between August 2010 and January 2011. This means 3,728 COEs per month from next month compared with 3,844 currently.
The reduction is less severe than expected because of the government's decision to allow the remaining adjustments for the overprojections of vehicle deregistrations in 2008/2009 to be spread over three years instead of one year. If the correction for the 9,577 COEs was carried out over the next 12 months instead of 36, the impact to the upcoming quota would have been greater.
Transport Minister Raymond Lim said this was in response to a suggestion by the motor trade and that LTA is prepared to do so 'to give the industry and car buyers more time to adjust'.
'These are one-time corrections, and will not affect the long-term growth in the vehicle population,' Mr Lim said in Parliament yesterday.
So, starting next month, the number of available Category A COEs (for cars below 1,600 cc and taxis) will be 1,020 per month, down 14.6 per cent from the earlier six-month quota period. Cat B (for cars above 1,600 cc) will get 847 COEs, or 11.6 per cent less.
But Cat C (for goods vehicles) gets an increase of 34.7 per cent to 551 COEs per month, while Cat D (for motorcycles) shrinks 2 per cent to 651.
Cat E (the open category) also gets a 6.6 per cent boost to 659 COEs.
The method of determining the COE quota was changed in April 2010 and it is now determined largely by the actual number of vehicles deregistered in the preceding six-month period, rather than being based on forecasts of future deregistrations. Since then, the number of Cat A and Cat B cars deregistered has been on a general downtrend as COE premiums spiked up.
'Motor traders are not overjoyed by the new COE quota but we all heaved a sigh of relief,' exclaimed the sales manager of a mass-market brand which has been hit hard by the shrinking pool of COEs.
He said he was grateful that the transport minister had accepted the industry's suggestion to spread out the remaining adjustments to the overprojected COEs.
'My job is safe for now and you should still see me around for a few more years,' the sales manager added with a laugh.
Mr Lim also said pay-as-you-bid COEs are not the solution to high premiums. He was replying to Member of Parliament Lim Wee Kiak who had suggested such a system for COE tenders.
The minister told Dr Lim, who is the chairman of the Government Parliamentary Committee for Transport, that this had been studied 'in great detail some years back' and that there were certain shortcomings. In particular, the spread of prices showed a clustering around the lowest successful bid of 'about 20-30 per cent'.
'It's not as though the highest bidder is pulling up the price,' explained Mr Lim.
Copyright © 2010 Singapore Press Holdings Ltd. All rights reserved.
