₹60 lakh plus cost of car? Singaporeans must pay big bucks to own new vehicle
- Locals in Singapore have to bid for the right to drive a car.
It isn't easy buying a new car in Singapore. It is not just about walking into a showroom, selecting a model, paying for it and driving out. The tiny island nation has limited space and has always prioritised popularising public transport options. In fact, anyone wanting to buy a new car has to first a Certificate of Entitlement (COE), something which has been in force since 1990. But recently, the cost of getting a COE has surged.
The COE is essentially a bidding process that allows a resident in Singapore the right to drive a car for a period of 10 years. There are categories of vehicles listed out and each category has a limited number of available quotas. Despite the relatively expensive prices, locals have almost always exceeded the number. This is also true for the latest round here, despite a sizeable hike in the COE costs.
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The most affordable is the lowest category or Category A. This refers to vehicles with an engine capacity of up to 1.6 litres or power output of up to 130 hp. COE costs are at S$104,000 or approximately ₹60 lakh. For large vehicles, ones with engine capacity of over 1.6 litres or power output in excess of 130 hp, the COE cost is now at S$146,002 or approximately ₹88 lakh.
In a nation where the average annual income is at around S$70,000 or approximately ₹42 lakh, the COE costs are indeed very steep. But because the quota numbers are relatively small - in lower hundreds for most categories, the bids almost always outnumber the available slots.
Reports further highlight that while COE costs had declined in 2020 owing to locals preferring to use mass-transit options, the demand for personal mobility surged through the Covid years, putting pressure on Singapore's efforts to keep personal cars to a limited number.
