COE Renewal Price | PQP Prediction for June 2021
COE PQP price for June – this is too easy to predict the direction now, anyone in the street will know the direction of where this is headed. It will be headed up for the month of June, with good news only for one category. Which one? Read on.
Looking at how the COE bids have gone, this is just a foregone conclusion, where Cat B has shot up suddenly past the $60k mark and remained there for two bids already, it’s not hard to know that this is going to have a hot air balloon effect on the PQP for Cat B which is currently still at $49,716 for the month of May. This current May PQP price looks to be lelong price to us, compared to where it will be going, soon.
This is how the first bid of May has gone, all green (lower COE price)! But why then are we saying PQP will go up?
COE Bidding Result 1st Bid of May 2021
Cat A $48,002
COE for Cat A went down, by $1,638 (-3.30%).
This is the first reduction in bid price after four rounds in a row of increases which began in the first bid of March 2021 before which the COE was at $41,001.
We were guessing that we are in the midst of an big uptrend in our earlier article, but this here is a reduction which we also expected. After all, nothing goes straight up, it always takes a breather before carrying on, if we are indeed correct about this uptrend being sustained.
Cat B $60,001
Cat B has eased off to the tune of $1,189 (-1.94%) compared to the previous bid.
This seems to be in line with Cat A except that Cat B has not gone up for as many rounds as Cat A before this breather, having only gone up three rounds before this where the price was at $45,001 before the three consecutive increases started.
But we think that is because Cat B has gone up too much, and too steeply. You will notice, that we are exactly $15,000 higher than the first bid of March 2021.
So similarly, this does not mean that the uptrend is broken, but only that the rise was too much too fast, and this is time for a rest.
Cat C $43,001
Cat C has gone down by $1,000 exactly or (-2.27%) for this bid.
Unlike the other categories, Cat C did not have a consecutive rise in prices, with the past five bids alternating between increase and decrease.
This instability was due to the fact regulatory changes were made to the emissions rules for commercial vehicles, resulting in a hefty penalty of $10,000 for all diesel vehicles that did not meet the new strict CVES rules that kicked in on 1st of April 2021.
However, in this alternate bid rise and fall situation, the rise in prices beat the decrease in these past five bids, and the current latest bid is at $5,488 higher than five bids ago in March 2021’s first bid.
We had mentioned this and the peculiarities of the rule change and dealer reactions before in another earlier article, resulting in see saw demand for Cat C COE, and much of which is an over-reaction (Is it? What is your opinion on this?) to the rule change which should find the longer term balance and $40,000 level now the the new rules are already in place, ceteris paribus.
However, things never remain the same for long, so don’t count on a solid & stable $40k level for long.
And what are these things that we can see already changing the situation for vehicle demand and COE bidding?
HA, And We Are Not Laughing
In fact, its quite painful for many businesses. So while we are bullish in the above on COE, let’s consider if some of this below may affect the COE bids to come.
Covid-19 Shows It’s Ugly Face Again
We are looking at raised level of Covid-19 transmissions in the community and many of these detected cases are unlinked, showing that they are from previously unknown and spreading chains of infections, many of which are from the more contagious Indian variant for which even the fully vaccinated are not spared. See below chart:
A doctor friend I spoke to says it is likely the population will require update jabs to be inoculated against other strains – we have no news of when this will happen.
And so, the best advice is to practice good hygiene, stay away from crowded public places, and avoid contact with common touch surfaces (door knobs, escalator handles, etc.)
Ironically, hand washing is encouraged but push button taps in public toilets are my personal top-of-the-bad-list, super unhygienic. And especially, the NEA should look into those that stop immediately when released. Take a moment to imagine what a crowd of people have just touched going to toilet before touching that push button tap. I digress.
Tightening Implementation Public Control Measures
The situation of which has brought us to a semi-CB now called Phase 2 HA (Heightened Alert) where the public is advised to WFH and not go out except for essential reasons. HA, but no joking matter, we should take this seriously.
Car buying is not an essential immediate need, and so we have feedback from several showrooms that the traffic is down, significantly. At least that is the picture here on day 3 of the new P2 HA.
While there are still orders in the books, if this were to continue, the demand side of the equation would be affected, even as COE quota remains tight and unchanged up till end July 2021.
I do not think the dealers are panicking at this moment in time, as they are likely also looking forward to a softer COE price – which is a possibility with the HA – and a return to more normal sales conditions, hopefully not to long in the future. The authorities are giving a mid June review timeline where the measure may be loosened, or not.
But There Is Bad News
So while the current COE quota would be unchanged till end July (end of the current quarter), and the demand side may temporarily see a slowdown due to HA, the flip side is, this usually results in pent up demand and greater upward pressure later – as we have already seen from past performance post-Circuit Breaker.
And further bad news is this – the unused COE quota from April to June 2020 that were supposed to be released for bidding over the following twelve months after bidding resumed, do you remember that? Those COE have been released in the past months and, well, that ends in June 2021.
Which means that from July 2021 onwards, there is no extra COE added into the bid from those three months when COE bid was suspended, likely to result in even tighter quota. All COE will only be recycled from vehicles being scrapped.
With the above being the current new and coming changes we can see affecting COE, here is what we forecast.
Prediction For June 2021 COE Renewal Prices | Cat A to Cat C
June 2021 COE renewal prices will be firm and can be calculated from the moment the second bid of May 2021 is completed, which is pretty soon.
Also, half of it is knowing what next month’s COE PQP price is going to be and so here we have our predictions. But if you are new to this whole COE renewal situation and want to find out more first, here are some FAQ on COE renewal.
Cat A $46,105
This is a predicted increase of $1,967.
Cat B $54,000
This is a predicted increase of $4,284.
Cat C $40,473
This is a predicted decrease of $48.
What Should I Do With These Predicted COE Renewal Prices For June 2021?
There are ways to save on COE renewal, and if you wish to know more, this article might be helpful. And what we have written there in the article we do professionally for our customers, with added finesse and experience from having helped hundreds with their COE renewal.
We call it PQP monitoring.
No other COE renewal service will do this for you. They all compete on admin fee pricing, which is really insignificant and not what your main focus should be.
Why? One company says its fee is $450, another says it is $375. If you picked the company that charges admin at $375, did you just save yourself $75? I don’t think that’s exciting at all!
When you have already decided to renew your COE for sure, register with us and we will help you out with when to enter the renewal market, and that is the key to achieving savings for your COE! We have had customers who have save thousands and a small few who have save five figures using our PQP Monitoring.
Can you save the same? It depends on the opportunity. We can explain when you contact us for a chat. But $75 savings is… downright unimpressive.
Not only that, we are voted one of the best COE renewal services in Singapore. Check reviews of what customers say of our services here.
Contact us early so it is not a rush and so you can make use of our free included PQP monitoring to your advantage!
You can reach out to us by filling in the below contact form or simply clicking on WhatsApp button to chat with us.
There are those who are still undecided on whether to renew or scrap or trade-in, we understand. You’re welcome to contact us for a chat too, and we will guide you along with the decision, like we have helped all those before you who have gone through their COE renewal.
Did you know? Sometimes a lower interest rate loan can cost more than a loan with slightly higher interest! But we will be here to assist, so don’t worry!