COE Renewal Price Cat A, B & C | October PQP 2021 Results
This seems quite unlike what we were expecting.
The COE bids have resulted in COE PQP renewal prices that we did not foresee and our predicted renewal prices for October are a bit off.
Before that, let’s take a look at how the latest bid of September 2021 turned out.
COE Bidding Result for Second Bid September 2021
Cat A $48,000
This is a price increase of $1000 (+2.13%). This is the third rise in a row for Cat A.
We expected a weaker Cat A as it only increased by a mere $311 dollars for a three week gap bid.
And now with the usual two week gap and the same number of pieces of COE available up for bidding, the bid price has gone up by more?
Could the reason be that there is now more than $20k difference in COE prices between Cat A and Cat B?
Cat B $68,310
Prices for Cat B rose this bid by $5,710 (+9.12%). This similarly, is also the third rise in a row for Cat B.
This is a big jump in prices from previously, and those in this industry were also not expecting this, according to reporting from Straits Times.
They had mentioned that this strength may be due to foreign buyers, and there could be some truth in it.
We had just mentioned that Cat B was now moving into the $60k level and it seems it has shot past this mark and headed closer towards $70k. Which is the price level for Cat E (Open) in this bid, $70,002.
And at this price, any dealer having a Cat E, it would only make sense to use them for the registration of Cat B cars, because Cat A and Cat C are much cheaper to just buy directly.
Cat C $39,000
This is a decrease of $1,001 (-2.50%).
After almost staying unchanged in the last COE bid with just a $9 decrease, this latest bid has gone down a four figure sum and is the third decrease in a row for Cat C.
Despite Cat C bearing the sharpest decrease in COE quota (-26.75%) for the August to October 2021 period compared to the quarter before, it has gone down.
The current Cat C is lower than the last Cat C pricing for July, which had more COE quota available for bidding than this bid of 120 pieces.
Unusual COE Bidding Prices Due To?
The ST article mentioned above offers a few reasons why the price bids went the way they did.
For Cat B, It May be That Foreign Buyers Are Causing The Rise
This is the reason offered in the ST article, and is not hard to imagine.
Rich foreigners who have invested in Singapore property, have come in here.
Because it is a safer place to stay to hide from Covid-19, for the time being at least, than their country of origin. And this may have skewed the Cat B, especially now, when the COE quota is low.
It is easy to affect the prices dramatically when the quantity available for bidding is smaller than usual.
(If you clicked on the above link, you will find the data on how much quota has been cut from the last two COE quota announcements made)
As for the mention of Tesla rushing their deliveries, that’s a maybe. I do not believe they want to cause a sudden jump as it will affect the profit margins on cars already in their order book.
But they may, or may not, have a choice given that some cars may be sold on guaranteed COE basis.
Cat A Affected By Private Hire Demand And Our Opening Up
This was a reason we had written on months ago, where we had mentioned among other reasons, that Grab was culling older COE cars from service and gradually will only allow those less than 10 years to drive their service.
This plus more normal ridership levels as the government continues to open up, means that private hire drivers are again making a decent income compared to their income from stricter WFH period of earlier months.
Which in turn means the vehicles that they use will be needed and bids for these cars will plump up demand for Cat A cars.
But from one bid to the next, this current one is $1k above the last bid, not really too big a jump.
Reason for Cat A Not Weakening This Bid
So while it has not weakened (what we had expected) but instead gone up, it may be for this reason – dealers needed a bit more time for their orders to fill up since the opening up of F&B (which does affect car shopping).
Now that they have more orders on the books of many different dealers, the prices are being bid up as dealer competes with dealer to make deliveries for their customers.
This happens only if there are more dealers bidding for the COEs.
Imagine if only one dealer was allowed to sell Cat A cars. Then they will submit number of bids equal to COE quota, but at the lowest price to maximise their profit margin, even if they had ample orders on their books.
Competition between dealers is what sets the ball moving and prices rising.
Not that there were not many dealers before, just that their order books did not fill up evenly, equally across all of them at the same time after shopping returned to more or less normal.
Cat C Going Lower Even With Low COE Quota
LTA had cut Cat C quota sharply for the current quarter, but we have not seen much of any of a price rise. In fact, it is slightly lower now. But why?
Our guess is the construction industry woes.
We know that construction companies had a tough time when the Covid restrictions on work were strict. Workers had to stay within the dormitories. This incurred in costs, but workers that could not be used productively.
As a result, many were sent back to their country of origin, to cut back on costs. Which resulted in the sale of many commercial vehicles related to the construction industry previously used for worker transport and construction projects.
This has gone on for months and there is likely an excess of commercial vehicles right now, in the hands of commercial vehicle dealers.
As we continue to open up, the number of workers required will increase again. It will take time for workers to come in. And so, the demand will come back. But for now, it is what it is.
Cat C is probably left mostly supported by delivery vans demand at the moment. This seems to be sufficient to keep the price where it is at the moment.
Should, or more accurately speaking, when the demand come back as more workers return, it should push prices higher.
And we are pretty sure it will come back. But come back at what pace and over how long a time, that will decide how high Cat C would go.
Results for COE Renewal Price October 2021
So with bidding that did not go where we really expected it, how goes the COE renewal price for October?
Prices shown below are for 10-year COE renewal prices for October 2021.
Want to look at our prediction to see if we got close to actual renewal pricing below?
Cat A $46,482
Lower by $222 (-0.48%) compared to September 2021 PQP price.
The PQP for Cat A has gone sideways for a few months now, since August. Every month’s change has been no more than five hundred odd dollars, with two down and one up.
The current price is very close to August’s which was $46,358.
Will it continue moving sideways for Cat A in November and is it a good idea to wait if your COE renewal still has some months to go? We can help answer this question, and any COE loan queries, if you contact us.
Cat B $60,586
Up by $2,462 (+4.24%) compared to the renewal price of September 2021.
This is definitely incentive for those with expiry in October to come in look for us at SG Cash N Cars and get the COE renewal done as soon as possible.
Wait any longer and you will pay the higher price of October.
If your COE renewal is coming up in November or later? The smartest thing you can do is to come register with us for PQP monitoring, a free included service with your COE renewal loan, and we will let you know where it is going.
You won’t regret, we promise!
Contact us using the WhatsApp button of the contact form immediately!
Cat C $40,004
Up by $833 (+2.13%) when compared with to the PQP of September 2021.
If you have vehicles in this category coming up for renewal in the coming month of October, it would be wiser to renew it straightaway.
We can help you with quick processing!
If your COE expiry date November or later, would it go up again?
Call us to find out and arrange for a COE renewal loan to be done at the correct time.
COE Renewal Price Notes:
You pay half the amount rounded up to the next dollar if there are any cents after divided by two, for 5 year renewals. However, should you consider a 5 year COE renewal? Or do you lose out all the benefits that a 10 year COE renewal gives you?
And here’s a tip on how to save on renewal! Click here.
Contact us to get more info on how to make the renewal make sense for your vehicle and when to renew.
COE Renewal With Savings For Many By SG Cash N Cars
If you are looking at COE renewal coming up, you will be glad to know we have helped hundreds and we will also help you also to secure an advantageous loan with the best terms and conditions avoiding the common pitfalls, and also to know when to renew, if you register early with us for PQP monitoring as our customer.
That’s not all we help with – you also get to choose from all available banks and finance houses for your COE renewal loan.
And we explain the benefits of each one to you if you’d like to know, before you pick the one that is most helpful in your situation.
But we will be here to assist, so don’t worry!
We sincerely hope that you pay a lower COE renewal price and get a loan with good terms and conditions, and to that, all our past customers can attest!
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