COE Bidding – 1st Round of April 2019

[TeamAMG69]

From this article: https://www.straitstimes.com/lifestyle/motoring/making-sense-of-the-coe-spike

 

“Word has it that rental companies in partnership with Gojek have been on a buying spree, with one of their latest acquisitions being a fleet of 1,000 Opel Insignia sedans.

Gojek has tied up with half a dozen such rental partners. So, it is able to ramp up its fleet without being asset-heavy. And it may have to go on this strategy if it wants to compete more effectively with Grab, which has the lion's share of the private-hire market.

Grab, on its part, is not sitting idle. Fuelled by seemingly unending waves of funding, it has also been renewing its fleet of cars to stay competitive.“

 

hi bro

 

thanks for replying ... the article link is golden, many MCF will be grateful ....

 

it all makes sense liao .... personally i dont think it is 1000 Opel .... wont be so little  .... 

 

the Million Question is what is the actual END GAME number of new vehicles purchase for  for Gojek ?

 

does anyone know roughly how many UBER and GRAB PHV (they bought or are on the roads?)

 

 

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The last time the premium shot up by as much was in September 2013, when car COE categories were modified to include engine power output as a determinant. Car dealers rushing to clear existing stock before the new categorisation kicked in sent premiums soaring.

Even then, on a percentage basis, this month's first tender exercise took the cake, with the Open COE premium rising by nearly 18 per cent - double the quantum seen in September 2013.

How unusual is such a spike? Very, considering that premiums have been moving (up or down) by 2 to 3 per cent on average since ride-hailing firm Uber exited the market in March last year.

The American firm's fully owned rental arm here, Lion City Rentals, was largely responsible for pushing up premiums as it ramped up its fleet since being set up in 2015.

Ever since Uber packed up, COE price trends have returned to a more steady (and saner) state. Until last week.

 

 

So, what happened? Fingers are naturally pointing to Indonesian ride-hailing firm Gojek, which entered the market last November.

Even though Gojek has said in press interviews that it would not adopt an asset-heavy business model like Uber, it does not mean the firm is not fuelling a demand for new cars.

This may seem illogical, given the thousands of unhired cars left behind by Lion City Rentals. The thing is, private-hire drivers do not like driving those older cars. They prefer newer, fuel-efficient models available today.

Word has it that rental companies in partnership with Gojek have been on a buying spree, with one of their latest acquisitions being a fleet of 1,000 Opel Insignia sedans.

Gojek has tied up with half a dozen such rental partners. So, it is able to ramp up its fleet without being asset-heavy. And it may have to go on this strategy if it wants to compete more effectively with Grab, which has the lion's share of the private-hire market.

Grab, on its part, is not sitting idle. Fuelled by seemingly unending waves of funding, it has also been renewing its fleet of cars to stay competitive.

Meanwhile, industry watchers say motor dealers - especially those selling premium brands - are shoring up their supply of COEs in anticipation of another supply dip from next month.

The quota for the May-July period may shrink by as much as 20 per cent.

Building up a stockpile of COEs may make sense, but it is a risky move because certificates have a limited shelf life. In the case of Open COEs, it is just three months.

Besides, it makes little sense for car dealers to drive premiums up by so much, so suddenly. First, it erodes their profitability; second, it drives potential buyers away from showrooms.

Which makes the private-hire factor more plausible. Seeing how aggressively Lion City Rentals had been bidding when it was here, it stands to reason companies in a similar position, flush with cash they do not have to account much for, are likelier to bid just as aggressively.

The fact that Open is now more than $5,000 higher than Category B (cars above 1,600cc or 130bhp) supports this hypothesis. The two categories are rarely far apart, since Open is, more often than not, a proxy for Cat B.

Only bidders who are able to pass on the cost increase in a palatable manner will bid this way. For instance, a $5,000 difference translates to a daily rental rise of only $4.60 over three years.

Whereas an individual car buyer might baulk at paying $5,000 more for a car. He may well choose to wait for prices to fall before buying.

Next, the vehicle suppliers which private-hire firms have tied up with deal also in used cars. In the past year, the used car trade has been reeling from falling COE prices, which directly and dramatically affects the value of their cars in stock. It would not be surprising then that they see an upside in driving COE premiums northwards.

I believe a lot of COE expiring in 2019 and 2020 have been renewed recently.

 

Therefore, the quota in 2020 could plunge from current quota of 3,300 monthly to below 800 for Cat A, and current 2,400 monthly to below 600 for Cat B.

 

If the GDP maintains a minimum of 2% and the PHV companies continues to expand their fleet via their partners, Cat A and B COE might soar to >$100k in 2020, which is beneficial to the PHV companies.

 

Hence, it will allow the government to earn more COE revenue while encourage more car sharing.

 

Bro,  

 

no need drop so dramatic drop from 3,300 monthly to 800

 

if the article is correct / accurate, 20% drop in COE will be 2640 / 2600 per month.

 

with GoJek buying up again .... (even if they wack 200-300 per month) .... and with Sinkie mentality of cannot lose ... all cheong in now ....

 

you cannot rule out that COE can hit 70K or much higher by end of the year .... 

Edited April 17, 2019 by TeamAMG69

[Tiger1]

I believe a lot of COE expiring in 2019 and 2020 have been renewed recently.

 

Therefore, the quota in 2020 could plunge from current quota of 3,300 monthly to below 800 for Cat A, and current 2,400 monthly to below 600 for Cat B.

 

If the GDP maintains a minimum of 2% and the PHV companies continues to expand their fleet via their partners, Cat A and B COE might soar to >$100k in 2020, which is beneficial to the PHV companies.

 

Hence, it will allow the government to earn more COE revenue while encourage more car sharing.

I sort of agree with your analysis.

 

If coe is too expensive, people own fewer cars and they can then adjust fares up.

 

Either ways, I also think. Coe is on its way up. 100k maybe. Who knows. It had been there before.

[TeamAMG69]

I sort of agree with your analysis.

 

If coe is too expensive, people own fewer cars and they can then adjust fares up.

 

Either ways, I also think. Coe is on its way up. 100k maybe. Who knows. It had been there before.

 

 

$100K is not the final target. 

 

 ANALyst have predicted much much higher 

 

 

https://www.torque.com.sg/all-articles/the-200000-question/

 

https://sbr.com.sg/sites/default/files/singaporebusinessreview/print/SBR_OctNov2015_p12.pdf

 

Choices are made for the population. In this environment, it is not surprising that stockbroking research house CLSA put out a report recently that said car COE will hit $200,000 by 2025, or 10 years from now. It is not immediately clear where or how CLSA arrived at this number. But looking at Singapore’s population growth trend, economic growth direction, and the deliberate attempt to stifle car population growth, you don’t need to be a high-flying analyst to come up with such a forecast. What are the chances of this terrifying forecast becoming real? 

 

 

On its part, the Government will not have to bear the consequences of a $200,000 COE, and yet it would quite likely be able to achieve its “car-lite” ambition. In the meantime, those in power who chant the “carlite” mantra might want to lead by example.

Edited April 17, 2019 by TeamAMG69

[Showster]

There goes my hopes of a second car.

[Vinceng]

I believe a lot of COE expiring in 2019 and 2020 have been renewed recently.

 

Therefore, the quota in 2020 could plunge from current quota of 3,300 monthly to below 800 for Cat A, and current 2,400 monthly to below 600 for Cat B.

 

If the GDP maintains a minimum of 2% and the PHV companies continues to expand their fleet via their partners, Cat A and B COE might soar to >$100k in 2020, which is beneficial to the PHV companies.

 

Hence, it will allow the government to earn more COE revenue while encourage more car sharing.

Yes , there will be a drastic drop in COE Quota. Many are rushing to renew COE now.

 

But I don't think COE will soar to above $100K. Probably along the lines of $80K to $90K.

 

No thanks to Private Hire.... Again.

The next cycle for COE to drop to low levels would be 2028-2029.

Edited April 17, 2019 by Vinceng

[Vinceng]

$100K is not the final target.

 

ANALyst have predicted much much higher

 

 

https://www.torque.com.sg/all-articles/the-200000-question/

 

https://sbr.com.sg/sites/default/files/singaporebusinessreview/print/SBR_OctNov2015_p12.pdf

 

Choices are made for the population. In this environment, it is not surprising that stockbroking research house CLSA put out a report recently that said car COE will hit $200,000 by 2025, or 10 years from now. It is not immediately clear where or how CLSA arrived at this number. But looking at Singaporeâs population growth trend, economic growth direction, and the deliberate attempt to stifle car population growth, you donât need to be a high-flying analyst to come up with such a forecast. What are the chances of this terrifying forecast becoming real?

 

 

On its part, the Government will not have to bear the consequences of a $200,000 COE, and yet it would quite likely be able to achieve its âcar-liteâ ambition. In the meantime, those in power who chant the âcarliteâ mantra might want to lead by example.

$200K COE? My foot !

 

That means a Nissan Sylphy or Toyota Altis would retail at SGD$250,000.

 

This price will put many out of the market.

 

All these research firms and foreign talents are blabbering nonsense, like the Ang Mo who said recently that 30km/h speed limit on the streets is safer.

 

Siao!

[Dafansu]

$200K COE? My foot !

 

That means a Nissan Sylphy or Toyota Altis would retail at SGD$250,000.

 

This price will put many out of the market.

 

All these research firms and foreign talents are blabbering nonsense, like the Ang Mo who said recently that 30km/h speed limit on the streets is safer.

 

Siao!

 

possible cause of private hire, maybe 80% private hire, the 20% are those who can afford $200k COE.  Maybe in year 2050 instead

Edited April 17, 2019 by Dafansu

[Club21z]

33k sup sup water compared to 2016 when I paid 50k plus for coe.

[Imaginary]

I guess those whose COE are almost due should quickly renew at $35k now

[blmg]

Yes , there will be a drastic drop in COE Quota. Many are rushing to renew COE now.

 

But I don't think COE will soar to above $100K. Probably along the lines of $80K to $90K.

 

No thanks to Private Hire.... Again.

The next cycle for COE to drop to low levels would be 2028-2029.

There were quite a fair bit of 5 year renewals in 2015/2016, so these will be recycled into the COE quota pool in 2020/2021.  

[Roh96]

There were quite a fair bit of 5 year renewals in 2015/2016, so these will be recycled into the COE quota pool in 2020/2021.

Not alot lah. Majority of the quota still from main stream parf cars.

I read that majority of PHV drivers rather pay abit more to rent brand new cars, especially hybrid model. If that is the case, what will happen to the aging fleet of vehicles? I suppose they will be exported or dereg right? So quota should not shrink too much i think.

[Vinceng]

My take is this – capitalize on this drastic COE rise to renew 10 years COE for your car now, and make a sweet profit when you sell it when COE prices double that of now in a matter of time.

 

[Roh96]

Then what? Use the money to buy the next car at higher COE? Isn't it back to square one?

 

 

My take is this – capitalize on this drastic COE rise to renew 10 years COE for your car now, and make a sweet profit when you sell it when COE prices double that of now in a matter of time.

 

[TeamAMG69]

Not alot lah. Majority of the quota still from main stream parf cars.

I read that majority of PHV drivers rather pay abit more to rent brand new cars, especially hybrid model. If that is the case, what will happen to the aging fleet of vehicles? I suppose they will be exported or dereg right? So quota should not shrink too much i think.

That is the part that puzzles me.

If new drivers prefer hybrid /electric car. Why Gojek buy 1000 units of Opel? I only see diesel Opel inside sgcarmart.com

Unless my eyes cross, if anyone can share the hybrid / electric Opel cars available in SG. Thanks

[Aheart]

Unless those with 2nd car or decided to give up driving. I just bought a second car last dec, hoping to sell when it is the right time:)

Then what? Use the money to buy the next car at higher COE? Isn't it back to square one?

 

[Roh96]

Haha..I see car as a transport tool, not investment tool. If I need to buy 2nd car, it is definitely not bcos I hope to sell it in future for a profit.

 

Unless those with 2nd car or decided to give up driving. I just bought a second car last dec, hoping to sell when it is the right time:)

 

[Roh96]

Suzuki prices up $5k. Very fast and furious.

Will there still be crowd this weekend?

[Dafansu]

Suzuki prices up $5k. Very fast and furious.

Will there still be crowd this weekend?

 

Yes, panic buyers who scare COE will shoot up to 60-80k.