The recent plunge in Cat B COE premium is peanuts compared to the COE crash of November 2008 that resulted in $2 COE
The cheapest COE ever cost only $2, after crashing down from $10,455 in the 19 November 2008 COE open bidding exercise for Category A.
The shocking $2 COE for Cat A cars with engines up to 1600 cc saw 1,852 bids for 1,851 certificates of entitltement, with the lowest successful bid being the eventual strike price. This record-low COE result was great for everyone who bidded, except the unlucky person who probably tried his luck with a token $1 bid.
In the previous COE bidding exercise at the time, the Cat A COE closed at $10,455. The drastic drop in the premium to $2 surprised the new-car sellers from Leng Kee to Ubi, and delighted the relevant car buyers who obtained the cheapest COE ever, plus COE rebates from the dealers where appliable.
The reasons for the $2 COE were said to be an ample supply of COEs relative to market demand in 2008, poor economic sentiment in Singapore, and the 2007-2008 global financial crisis.
After the $2 COE shocker, the Government decided to merge the four COE categories into two so as to give the COE bidding system greater price-stability.
It has been 15 years since the $2 COE crash. Will motorists see a single-digit COE again? Extremely unlikely if demand continues to outstrip supply by a significant-enough margin.
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For those looking to renew their COE, Motorist also provides free COE renewal advice. That way, you can decide if it's a better option to scrap your vehicle or extend its life.