The COE price for cars up to 1,600cc and 130bhp closed 3.8 percent lower at $58,700. The premium for cars above 1,600cc or 130bhp posted the biggest drop of 8.4 percent to end at $65,501. The price for Open COE, which can be used for any vehicle type but ends up mainly for bigger cars, fell by 7.4 percent to $69,001, reported The Straits Times.
The price drops - the biggest in nearly half a year - brought premiums to their lowest in at least five months.
Mr. Neo Nam Heng, Chairman of Prime group of motor companies, said prices would have fallen more sharply if currencies such as the euro and yen had not weakened. "The weaker yen and euro have given dealers more margin to bid for COEs," he said.
But with more COEs expected in the next three-month quota starting next month, Mr. Neo said premiums will continue 'to trend southwards', and buyers should not rush to showrooms just yet.
The general drop in COE prices, especially for cars, has been widely expected. Motor traders said that the fear of price rises on the back of a revised carbon tax, that came into effect on 1st of July, led to a surge in 'forward buying'. Now that the new tax is already in place, there is no more rush to beat any deadline.
Mr. Nicholas Wong, General Manager of Honda agent Kah Motor, added that many dealers had also decided not to fully pass on price rises caused by the revised carbon tax scheme because of intense competition. This meant they had thinner margins to bid for COEs.
