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SINGAPORE: In the 33 years since Certificates of Entitlement (COEs) for vehicle ownership were introduced, the system has controlled Singapore’s car population.
But private vehicles are now being used for ride-hailing services, and the COE system has not gone through a “more fundamental review” to deal with such changes, experts told CNA.
On Wednesday (Oct 18), COE prices for all types of vehicles again reached new highs. COE for smaller cars in Category A climbed to S$106,000 (US$77,500), while Category B cars, which are larger and more powerful, breached an eye-watering S$150,000.
As records continue to be broken at each COE bidding exercise, members of the public have questioned if the system is broken.
One commenter on a CNA Facebook post said Singapore is being “penalised unnecessarily by a good system gone rogue”. Another said it is not effective because there are still traffic jams and called for it to be abolished.
CNA asked analysts if comments that the system is beyond repair are valid, or if the system is working as it should.
Private cars being used for business purposes may be causing prices to climb, they said. For example, consumers have to compete with rental companies and buyers who intend to use the cars as private-hire vehicles.
“PHVs and car rental fleets could be playing a considerable role in the all-time high COE prices we are presently seeing,” said Mr Yeo Swee Guan, a management associate at Motorist Singapore.
“While the cost of a COE at current prices may be an extremely considerable expense to individuals and families, they would be less of a concern to companies whose businesses are in rental or leasing.”
Buying a vehicle makes sense for those who are using it for business, such as rental fleet owners or those who drive private-hire vehicles, said Mr Ng Lee Kwang, board adviser at industrial vehicle leasing company Goldbell Corp.
“As individual buyers, we don’t have a (profit and loss statement),” he said. “We buy the car and we’re stuck with it.”
Private-hire cars can be converted to personal vehicles for sale. The conversion costs S$100 (US$73).
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