The big four digit drop in COE released on 7 December 2016 was a shocker to many car owners and buyers. With premiums for Cat A falling from $50,951 to $48,000, Cat B from $53,001 to $46,229, Cat E from $54,901 to $50,010 - we can expect these trends following the COE price dip.
1. Dip in car prices
This one's obvious, but the price for your shiny new car will now roughly cost $80,000 - $120,000 for a mid-end ride. If you divide that over 10 years, that's $8k - $12k a year. With people being more cautious about buying a car, and the plunging prices of owning one, COE prices may crawl down to a stop and start back up again. It's all about the ebb and flow of demand and supply.
See also: How to renew your COE
2. Fluctuation in car sales
Although car prices may dip, car demands go up. The demand figure doesn't include factors like car-sharing drivers from Uber and Grab, the demand will fluctuate and in a couple of years, this might mean prices could fall even more. The push and pull from a society that's picking up on ride-sharing apps can spell disaster for car sales, with fewer people buying cars. Whether this is a good thing all boils down to if you're a buyer or dealer.
It's the holidays - most people are away to even bid for COE. This can result in lower car sales and fewer bids. What does this mean for you? If you're one of the few people who stayed behind, your bid might just be the lucky one. While it's predicted that prices should continue to fall, just don't wait too long on bidding. Remember, there's always someone out there waiting to snatch a place on the road.
4. PQP plunge
These are players in a league of their own. Because renewing car owners don't have to bid for COE, the plunge in PQP means that there might be more people renewing their COE. When this happens, the next bidding cycle can surge thanks to the limited number of cars allowed on the road. So grab this opportunity while you can.
With such a big drop in COE prices, there may be a change in market demand. Click here for a quick and non-obligatory valuation of your vehicle now!