Six Things To Look Out For When Buying A New Car In Singapore

Published by on . Updated on 2 Jun 2020

Motorist What Look For Buy Car Singapore 2019(Photo Credit: SG Yahoo Finance)

Buying a new car in Singapore is never easy. There are several things you have to consider, such as the cost of the vehicle, the car model you desire, what to do on a test drive and many more.

We’re all familiar with the challenges of buying a new car. For both first timers and those wanting to replace their old vehicle, this is a process that can be exciting and yet, frustrating. There are many aspects to take careful consideration of when choosing a new car.

Hence without further ado, here are six things to look out for when getting a new car in Singapore.

1) Cost of Buying a New Car in Singapore

Motorist Cost Buy New Car Singapore 2019(Photo Credit: Motorist)

When looking for a new car in Singapore, the topmost factor you’ll have to consider is the price. Cars in Singapore don’t come cheap due to the numerous costs levied. There are four parts to the cost of a car in Singapore, namely the ARF, COE, OMV, and Excise Duty and GST.


The ARF refers to the Additional Registration Fee, which is the tax imposed upon your car after it is registered. It can be calculated at a tiered rate based on a percentage of the OMV of your vehicle, and therefore differs for each vehicle. When purchasing a new car, it is important to calculate the ARF to ensure it doesn’t exceed your budget.


The COE is the Certificate of Entitlement, referring to your right to vehicle ownership in Singapore and what enables you to buy a car in this country. COE prices each month will differ and the changes in them determine how much you’ll need to fork out when buying a new car. For example, COE prices have mostly increased recently, causing the price of buying a new car now to possibly increase as well.


The OMV of a car stands for its Open Market Value, which is the baseline sticker price of the car. It is the price payable for cars imported into Singapore. Furthermore, it tells us what people in other countries are paying for each car. This component of the price of a car is one the most important factors in figuring out whether you should opt for the purchase of this vehicle or not.

Excise Duty and GST

Excise duty is a form of tax that is imposed on specific goods and services. In Singapore, the list of goods we have to pay excise duty for includes cars. The excise duty on cars is calculated by taking 20% of the OMV. That’s not the end of it, however - an additional 7% GST will be taxed on both the excise duty and the OMV. Accumulated together, these taxes can be pretty significant in adding on to the cost of your car.

2) The Type of Car Model You Want

Motorist Car Model Buy Car Singapore 2019(Photo Credit: Torque)

When choosing a new car, an important consideration would be the model you’d prefer. Different car models have different features, making it pertinent that you consider each one carefully before coming to a decision. For example, Japanese models are famously known for being the most value-for-money, while continental models are preferred for their performance and superior engineering.

If you’re buying a car for the first time, it is important that you do not restrict yourself solely to one brand. Instead, form a list of at least five brands you’d like to purchase a car from. Restricting yourself to one brand, especially for a first-time purchase, might cause you to lose out on other better car models from other brands.

Another factor to consider is that different car models come at different prices. If you have a tighter budget, it may be best to stick to brands that are more affordable. Brands like Toyota and KIA are considerably more affordable than brands like Volkswagen or Mercedes.

Read More: 5 Family-Friendly Cars to Buy in Singapore

3) Reliable Places to Buy a Car

Motorist Buy Car Showroom Singapore 2019(Photo Credit: Audi)

There are two routes you could opt for to buy a new car. The first option is purchasing from authorized distributors, which are authorized to sell one car brand. The second option, often preferable for those with a tighter budget, is to purchase your new car from parallel importers. Parallel importers are able to sell cars from various brands.

While there are a number of showrooms located around Singapore, the two car belts with the highest number of showrooms are located at Ubi and Leng Kee. The Ubi car belt is located along Eunos Link, and easily identifiable by the number of showrooms located alongside it. The Leng Kee car belt is located along Leng Kee Road and Alexandra Road, and is similarly identifiable.

As for parallel importers, they can be found at seven car marts located around Singapore. The list of these car marts is as follows: Automobile Megamart, Commonwealth Car Mall, Leng Kee Car Mart, Thomson Used Car Centre, Turf City Auto Emporium, West Coast Car Mart.

As the services in different parallel importers may differ, it is best you do your research on the varying services each importer offers before choosing to go to one. Often, customers have found other parallel importers that offer better discounts and deals after already making a purchase. Therefore, avoid being shortchanged by being really thorough with your research of different parallel importers.

Read More: Authorised Dealers VS Parallel Importers: What to Look Out For

4) Taking Your Car For A Test Drive

Motorist Test Drive Buy Car Singapore 2019(Photo Credit: Dollars and Sense)

The cardinal rule of purchasing a car is always ensuring that you take it out for a test drive. This is done so as to ensure the car is the perfect choice for you in terms of engine capacity, horsepower and more. Here are three tips you need to take note of when out on a test drive.

Check the Engine capacity

While on the test drive, stay in the range that you’re likely to be in when driving normally on the road. It is also important to check the functioning of the accelerator. Additionally, ensure that the lag time between depressing the accelerator and the car taking off is one that you are comfortable with.

Check for Comfort of the Vehicle

It is important to make sure that each and every aspect of the interior of the car is suited to your comfort. Ensure that the seats are adjustable and comfortable, allowing you to extend the leg room for those in the rear seat if needed. The design of the interior should also be comfortable enough for you to manipulate various functions like the thermostat without taking your eyes off the road.

Take a Friend with You

When taking the car out for a test drive alone, there may be certain faults you could miss out on. It is always better to have an extra pair of eyes to watch out for anything you yourself might overlook during the test drive. If the car you’re getting is intended for your family, ensure that your family members get to sit in the vehicle as well.

Besides these three tips, there are various other issues you would need to take note of during the test drive, such as cabin room, brakes, gearbox and much more. Do not take just one vehicle out for a test drive, as different vehicles will have varying capacities. Instead, form a shortlist of different vehicles within your budget so that you may be able to find the best possible option.

5) Negotiating in the showroom

Motorist Negotiate Price Showroom Buy Car 2019(Photo Credit: The Straits Times)

After you’ve decided on the vehicle you want to purchase, ensure that you get it at the best price possible. Haggling takes place everywhere, and the showrooms for cars are no exception. Before you attempt to haggle for a good price, ensure that you do your research beforehand on the OMV of the vehicle, the latest COE prices and the promotions that are available.

In addition, there are certain tactics you could employ that would enable you to gain a better price. For example, lowballing or stating that you have other showrooms in mind are viable tactics that may make the car yours at a better price. Do not be afraid to haggle for a better price, as it is always preferable to lessen the burden on your wallet.

On the part of the salesperson, there are certain haggling tactics you need to recognize and hence avoid. Often, salesmen may propose certain promotions or deals to lure you to the purchase of a certain car. However, some of these promotions or freebies may not be as much of a benefit as you’d like. For example, a fancy stereo system does sound attractive, but isn’t all that necessary for a pleasant ride. Some of these promotions are just a tactic to make you purchase the vehicle even if it may not be the best option for you.

6) Getting Car Insurance for Your New Vehicle

Motorist Car Insurance Buy Car Singapore 2019(Photo Credit: The Straits Times)

Another important consideration after choosing the vehicle you want to buy is the type of car insurance to get. As with all services in Singapore, car insurance does not come in cheap. The price of insurance will differ based on your age, gender, marital status and occupation. It’s important to know what the different types of car insurance are, and which ones would be best to invest in.

There are three types of car insurance policies in Singapore, third party only (TPO), third party, fire and theft (TPFT) and comprehensive car insurance. TPO insurance is cheaper than comprehensive, and covers only damage incurred by other vehicles in an accident deemed your fault. It is also the minimum requirement for vehicles in Singapore.

TPFT insurance is similar to TPO insurance in that it covers damage to another person or vehicle in an accident deemed your fault. However, in addition it also covers your car in cases of theft, and fire by offering a payout. This insurance plan is recommendable if you're planning to take your new car out of Singapore frequently.

Comprehensive, while more expensive, covers damage incurred by your own car as well. Whether you would like to opt for comprehensive insurance or not is really dependent on the make and model of your car. For example, if your car’s an expensive make, opting for comprehensive would be preferable even with the extra cash involved.

Read More: 5 Things to Consider Before Buying Car Insurance in Singapore

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Read More: The Complete Guide to Buying a Used Car, From Budgeting to Choosing the Right Car

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1 Comment

Nice article!

almost 5 years ago