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SINGAPORE: Sales of luxury cars are enjoying a boost as buyers are willing to splurge on more expensive vehicles in a booming economy.
Some distributors of premium car brands are reporting sales spikes of as much as 80 percent, even as overall new car sales remain even.
There were some 48,000 new cars registered in the first five months of this year, similar to a year ago.
Distributors of premium car brands – mainly big cars priced at S$100,000 and above – are reporting strong improvements in sales, despite a jump of nearly 45 percent in the COE (certificate of entitlement) for large cars.
German brand Audi, for one, said sales have improved 84 percent year-to-date.
Reinhold Carl, Managing Director, Audi Asia Pacific, said: "The total sales in 2006 was 651 cars and we want to achieve sales of 850 cars, minimum, this year.
"It is expensive to own a car in Singapore, so I believe the car will become more of a luxury item. The affluent people will not stop buying cars, therefore there will be a higher market share for our segment in the future."
Jardine Cycle & Carriage, which distributes the Mercedes Benz, said its luxury segment is also seeing strong growth.
But it warned that the growth potential could be capped by the fewer number of COEs that are being released.
Cheah Kim Teck, CEO, Group Motor Operations, Jardine Cycle & Carriage, said: "I would say this year's sales numbers have been even better than last year's. Overall, the trend seems to be improving as compared to the last two or three years.
"Unfortunately for the motor industry, we're governed very much by the number of COEs given, so I don't think we will move in line with the dramatic growth that we are seeing in the economy.
"We probably have to grow along the pace that is set by the number of COEs that is available in the market. At the moment, it seems like it's coming down."
The total quota for COEs has been set at 127,000 for May this year until April next year, 12,000 less than the same period a year ago.
Overall, smaller cars that are 1,600cc or below are the most popular, accounting for some 60 percent of all new cars registered between January and May this year.
- CNA/so
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