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Straits Times
29-05-2025
- Automotive
- Straits Times
Car COE renewals in Q1 2025 highest since same period in 2020
Experts attribute the higher COE renewals to the uncertain economic outlook, prompting owners to hold off new car purchases. PHOTO: ST FILE SINGAPORE – Some 2,834 cars had their certificates of entitlement (COEs) renewed in the first three months of 2025, more than double the number for the same period in 2024. The figure is also the highest for the quarter since 2020, when there were 5,558 renewals. Since then, first-quarter COE renewals had decreased – from 2,730 units in 2021 to 1,825 in 2022 and 1,129 in 2023. The figure climbed to 1,378 in 2024. Experts attribute the higher renewals to the uncertain economic outlook, which prompted owners to hold off new car purchases. Others are biding their time for electric vehicle (EV) technology to mature before they switch from their existing cars that run on petrol. This comes at a time when there is a larger population of cars reaching the end of their COE lifespan in 2025 than in the past few years. A COE is a requirement for a car to be used on the road. It has an initial lifespan of 10 years, and can be renewed by five or 10 years. Data published by the Land Transport Authority (LTA) on May 13 showed that in the first quarter of 2025, five-year renewals accounted for 67 per cent of the 1,204 renewals in Category A, which is for smaller or less powerful cars. In contrast, 74.4 per cent of the 1,630 renewals in Category B – which is for larger, more powerful cars – were for 10 years. Dr Zafar Momin, an automotive industry consultant and adjunct professor at NUS Business School, said the recent renewals may have been driven by risk-averse owners who are concerned about the economic uncertainty and want to avoid shelling out for a new car, which will be costlier than renewing the COE of their existing cars. For example, a person who bought a Toyota Corolla Altis in 2015 would have paid less than $120,000, including a COE. Renewing the COE of this car in 2025 is more affordable than replacing the car with a new one, which is priced at about $170,000 with a COE. The cost to renew a COE is based on the average COE premium in the three preceding months. A five-year COE renewal costs half as much as a 10-year one. The data shows that the number of COE renewals increases when the cost falls. Experts said that while the cost to renew a COE today is high, consumers will find that it is still more affordable than buying a new car. In March, a 10-year renewal for a Category A COE cost $92,525 – the lowest since September 2024, when it was $91,697. This was driven by an $8,601 drop in the premium at the first tender exercise in February. Accordingly, more car owners renewed their Category A COEs in March compared with the previous two months, with 598 doing so. Similarly, more owners of larger cars renewed their COEs in January, when the cost – $109,164 – was the lowest for the quarter. Mr Raymond Tang, managing director of used-car dealership Yong Lee Seng Motor, said the population of cars reaching the end of their COE life includes those that will get a low scrap rebate. It makes financial sense to forfeit the rebate and renew the COE of such cars, he said. For a small and economical family car such as the Mitsubishi Attrage, the scrap rebate before the end of the COE is $2,500. Mr Tang said five-year renewals tend to be more popular for Category A COE cars because the owners of such cars are likely to be more budget-conscious. However, the COE cannot be further renewed at the end of five years and the car must be deregistered. He said owners of Category B cars are less constrained by their budget and want to have the option to continue using the car for longer. Mr Oliver Ong, managing director of Accord Motor Enterprise, which offers COE renewal loans, said the number of inquiries for such loans at his company has increased by around 20 per cent since late 2024. Associate Professor Alberto Salvo from the NUS Department of Economics noted that some owners may be renewing COEs to hold onto their existing cars that run on petrol for a bit longer before making the switch to EVs. These owners, he said, are using the time to watch the development of EV technology and how the charging network develops, and to hear the experience of people they know who have made the switch. This is as EV adoption speeds up. In the first four months of 2025, 40 per cent of all new cars, or 5,947 units, were EVs. Overall, however, EVs are still the minority, making up 6.4 per cent of the total car population as at April 30. Associate Professor Steve Yim, an atmospheric scientist at NTU's Asian School of the Environment and Lee Kong Chian School of Medicine, noted that the higher number of COE renewals slows air-quality improvement, as newer vehicles are built to meet more stringent emission standards. New petrol-powered cars registered from September 2017 have to meet the Euro VI emissions standard. It imposes stricter limits on vehicle tailpipe emissions than the Euro IV standard, which was introduced in 2006. Content creator See Neng Tat, 35, renewed the COE for his Mercedes-Benz A180 car in April for 10 years, and hopes to continue using his vehicle for as long as possible. Considering the money and effort he poured into his car over the past 10 years to maintain and upgrade it, the self-professed 'car guy' said he is not attracted to new cars with their many high-tech features. Mr Henry Seah, 44, is keeping an eye on COE renewal prices. He is prepared to spend up to $50,000 to renew the COE of his Mazda Biante multipurpose vehicle by November. Even though this may mean that he can use his vehicle for only five more years, the director of a finance company and father of three said he is not willing to part with more than $100,000 for a 10-year renewal because it is 'just crazy'. Lee Nian Tjoe is senior transport correspondent at The Straits Times, where he also oversees the Motoring section . Join ST's WhatsApp Channel and get the latest news and must-reads.
Straits Times
23-05-2025
- Automotive
- Straits Times
Me And My Car: The car-nutty professor's journey to Infiniti
Car guy: Dr Zafar Momin has not quite decided what to do after his Infiniti Q70's certificate of entitlement expires in two months. ST PHOTO: ARIFFIN JAMAR SINGAPORE – Dr Zafar Momin is a car guy with a difference. Besides having an affinity for cars, he has spent much of his professional life in and around the automotive industry. The 66-year-old has worked for a major car manufacturer, covered the industry as a consultant and joined a diversified group with motor dealerships before embarking on a post-retirement career in academia. Join ST's Telegram channel and get the latest breaking news delivered to you.
