The price movement for the first COE bidding for the month of April has been nothing short of surprising, with both Cat A and B moving upwards significantly. This upward movement was beyond what we had expected. We are in the same quarter as March for COE quota, and that means the number of COE up available for bidding is almost exactly the same to the first and second bids of March. We are also trying to think of the reason why this first bid of April is up by such a large increase, especially puzzling is the COE bid increase for Cat A.
February and March months’ bids we can understand the upward trend for Cat B COE, where there has been a reduction in they COE quantity for this Category as compared to the quarter before, but for Cat A, the reduction is not as severe, and the first two months of this same quarter starting in February did not see large movement in bid prices. So it is puzzling that Cat A should increase by $2500. We are still trying to figure out the possibilities.
But with the above rise in COE bid prices for April, this does not bode well for those who are going to renew COE. Below is our prediction in the coming month of May 2019.
Predicted PQP for the month of May 2019
PQP Cat A Up, $27,153
Up by $978 compared to Cat A PQP of the month of April 2019.
This is a significant increase and the largest one for Cat A that we can remember for the past two years plus. It
PQP Cat B Up, $38,896
Up by $3,485 (ouch!) compared to Cat B PQP of the month of April 2019. This increase is quite drastic and mirrors the sharp fall in PQP January to March in 2018 but in the opposite direction this time!
PQP Cat C Up, $27,046
$286 upward difference compared to Cat C PQP of the month of April 2019. This is the mildest increase of all the four wheeled vehicle categories for the April to May comparison.
The above figures are our prediction for May 2019. For April PQP renewal price, please click here.
Is There Something We Don’t Know About?
Sure seems that way when we look at the recent COE bidding prices, we don’ see the reason for increase in Cat A and there have only one plausible reason why it is happening – many dealers are afraid of the COE quota drying up in the coming quarter of May – July 2019, especially for the Cat B. And their feeling of this shrinkage is translating in to fearful bidding and a sharp rise in prices. You can see this by looking at the Open Cat COE bidding prices. They are much higher than Cat B even, so why would dealers choose to pay more for Open Cat? The difference in Open Cat is that they can be kept for some months and transferred to any name for registration purposes. So catching an Open Cat means dealers can still sell their cars when the actual Cat B moves beyond $48,209 (oh my!), the current Open Cat pricing. This is some $5,107 higher than actual Cat B for first bid in April.
Sometimes sentiment translates to reality. And this seems to be the case. However, if the announcement for the COE quota should be more favourable than thought, then the COE bidding prices will start to ease off once more. At least, that’s the hope. The COE announcement should happen sometime in April.
Sorry for the glum tone of writing this month, it’s not a happy picture as all prices seem to be up!
If you are looking to renew your COE, our advice is to do so soon, while the COE renewal price is still at the current April level. We are not rushing you, but it does not look great in the upcoming months.
If you are thinking of taking finance for your COE renewal, you may like to know we can help. And we have the happiest customers in this industry! Call or WhatsApp us at 92782880 or fill in your info for us to contact you using the form on the right.
Thanks and wish you guys all the best with your renewal!