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SINGAPORE – If you're planning to buy a car in Singapore, understanding the Certificate of Entitlement (COE) system is essential. Unlike most countries where car prices are mainly determined by the brand and model, in Singapore, you also need to "bid" for the right to own and register a vehicle. That’s where the COE comes in.
In this guide, we’ll break down how the COE system works, why it's so expensive, and what factors influence these prices.
🧾 What is a COE?
The Certificate of Entitlement (COE) is a permit that allows you to own a vehicle in Singapore for 10 years. After 10 years, you can either renew it by paying the Prevailing Quota Premium (PQP) or deregister the vehicle.
This system was introduced by the government to control the number of vehicles on Singapore’s limited road space.
🚘 How Does the COE Bidding System Work?
The COE system is auction-based, with bids placed in five categories:
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Category A: Cars up to 1,600cc and 130bhp, including some electric vehicles (EVs).
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Category B: Cars above 1,600cc or 130bhp.
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Category C: Commercial vehicles and goods vehicles.
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Category D: Motorcycles.
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Category E: Open Category – usable for any vehicle (usually used for high-end cars).
Twice a month, the Land Transport Authority (LTA) opens a bidding exercise. The final COE price is the lowest successful bid within each category.
💸 Why Are COE Prices So High?
COE prices vary depending on:
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Demand for cars: More buyers = higher COE prices.
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Quota available: Fewer COEs = more competition.
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Market trends: Ahead of events like the Singapore Motorshow or festive seasons, demand often spikes.
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Economic conditions: Inflation, interest rates, and consumer confidence can also influence prices.
📈 What Happened Recently?
As of April 2025, COE prices are climbing again:
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Category A: Rose by 3.4% to $97,724
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Category B: Increased to $117,899
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Category E (Open): Slight increase to $117,002
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Category C (Commercial vehicles): Dropped to $68,782
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Category D (Motorcycles): Rose to $9,889
This spike was influenced by a longer-than-usual gap between bidding rounds and increased consumer activity ahead of The Car Expo in May.
📉 Can COE Prices Drop?
Yes, but rarely. Prices may dip if:
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There’s an increase in COE supply
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The economy slows down
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People delay purchases due to global events (e.g., trade tensions)
In January 2025, the LTA announced an 8% increase in COE supply from Feb-Apr, which initially led to a drop in prices — but demand quickly rebounded.
🧠 Tips for COE Bidding
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Monitor past trends and bid during low-demand periods.
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Consult dealerships—many offer COE packages that manage the bidding process.
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Be flexible with your choice of car model to fit within the lower-priced categories.
