reset
Viewed : 3,658 times

Recommended Articles

Powered By: The Straits Times

According to LTA statistics, Singapore's car population has aged over the last 10 years, and is increasing business for vehicle workshops.

26 Feb 2018 | Local News : Singapore


Singapore's car population has aged noticeably in the last decade, a trend that has ramped up business for vehicle workshops. According to Land Transport Authority (LTA) statistics, the number of cars nine years or older stood at 163,323 as at end-2017, making up 26.7 percent of the car population. In 2007, there were 30,529 such cars, which accounted for 5.9 percent of the car population.

Singapore's car population has aged significantly over the last decade
The statistics showed the percentage of older cars climbing sharply from 2013, when new car prices shot up on the back of near-record Certificate of Entitlement (COE) prices.

COE premiums hovered close to $100,000 that year. This prompted many owners to revalidate the COE on their existing cars, instead of buying a new one.

Each COE lasts for 10 years. Motorists can extend it for another five or 10 years by paying the Prevailing Quota Premium, which is an average of prices in the preceding three months.

Mr. Jeremy Soh, Director of workshop operator Ricardo Auto Centre, said, "From an annual depreciation standpoint, COE extension is very reasonable." Currently, renewing a car COE for five years costs just over $20,000, and some $40,000 for 10. A new car with COE starts from around $80,000.

The trend is expected to continue. According to the LTA, 31,088 car COEs were revalidated last year - 5.3 percent more than the previous record high in 2016. Mr. Soh said that with several popular cars such as the Honda Vezel having been accorded carbon tax breaks in recent years, more people will choose to keep their cars beyond 10 years.

COE extension is a viable alternative when coming from an annual depreciation standpoint
This is because the scrap rebate of such cars - which is forfeited once a vehicle reaches 10 years old - is substantially smaller after the carbon rebate.

Hence, owners would have to forgo much less should they choose to keep their cars. Mr. Soh added, "People are realising that they don't need to change their car every 10 years."

As a result, business for workshops has been brisk. "It has been better for us. To keep their cars longer, people come in to change parts such as suspension, engine mounts and air-con parts, and even for new paintwork."

Mr. Joey Lim, Managing Director of workshop Harmony Motor, said motorists also tend to 'minimise maintenance' once their cars reach eight years of age. Hence, if and when they decide to revalidate the COE, they end up spending 'quite a bit on repairs'.

Singapore Motor Workshop Association President Francis Lim said 'quite a lot' of older cars actually belong to private-hire operators such as Grab and Uber. "They have their own workshops, which are not our members," he added, pointing out that association members make up 30 percent of the 2,000-plus workshop operators here.

Car owner Aaron Hia, 33, plans to extend the COE on his Honda Civic Type R when it expires in September. Mr. Hia, who works for a major motor company, said he has spent around $10,000 refurbishing his car, with $6,000 or so going into revamping the engine. "It is good for the next 10 years with proper maintenance," he said.
  • Email