SINGAPORE: Owners of motorcycles registered before Jul 1, 2003 will get up to S$3,500 if they choose to de-register their motorcycles over the next five years.
About 27,000 motorcycles will meet the criteria for this incentive, which comes as the Government steps up efforts to meet air quality targets by 2020.
"Over the years, we have been trying to reduce the number of older vehicles on the road to ensure that our air quality is something that’s healthy for everyone to breathe," Environment and Water Resources Minister Masagos Zulkifli told reporters as he announced the incentive on Friday (Apr 6).
The incentive consists of two components: S$2,000 for eligible owners and an additional S$1,500 if they do not renew their motorcycles’ Certificate of Entitlements (COE). Owners will also get a rebate for unused COE periods.
The breakdown means that eligible owners who choose to renew their motorcycles’ COEs on or after Apr 7 before de-registering their motorcycles within the next five years will only get S$2,000.
Owners of motorcycles that are on five-year COEs, or the Classic, Vintage (Restricted) and Revised Vintage Vehicle Schemes as of Apr 6 are not eligible for this incentive.
Eligible owners will receive a letter from the National Environment Agency (NEA) by the end of this month informing them of the incentive.
"This (incentive) is one way for them to evaluate and compare the cost-benefit of having the vehicle on the road versus cashing it out and using hopefully public transport, or even if they have to, change to better standard motorcycles," Mr Masagos said.
"This will incur cost for themselves, but the S$3,500 they can cash out will lower the burden of doing so."
OLDER MOTORCYCLES FACE TIGHTER EMISSIONS STANDARDS, TO BE PHASED OUT EVENTUALLY
After the incentive scheme ends on Apr 6, 2023, NEA will tighten the in-use emission standards of such older motorcycles. The agency said it will release details in due course.
After Jun 30, 2028, these motorcycles will not be allowed on the roads.
However, motorcycles on the Classic, Vintage (Restricted) and Revised Vintage Vehicle Schemes are exempted as they are already subjected to restricted usage.
Meanwhile, NEA said it will look at measures to reduce pollution from foreign motorcycles, without elaborating further. Last month, it nabbed 197 motorcyclists at the land checkpoints for smoke and excessive noise emission offences.
NEA is targeting motorcycles as they contribute 53 per cent to local sources of carbon monoxide (CO), even though they make up 15 per cent of vehicles on the road.
In addition, older motorcycles registered before Jul 1, 2003 emit up to 30 times more pollutants than new motorcycles. They also contribute 40 per cent of the total CO emitted by motorcycles on the road.
“Motorcycle emission is a public health concern because it contains hydrocarbons and CO, which are precursors to ozone,” NEA said in a release. “CO and ozone are known to impair respiratory functions.”
Channel NewsAsia understands that NEA does not have plans to roll out this incentive for older cars as they only make up 1 per cent of the car population.
In contrast, motorcycles that are 15 years old and beyond make up 21 per cent of motorcycles on the road. Some of the oldest bikes on the road are more than 65 years old.
IMPACT ON COE PRICES
Channel NewsAsia also understands that the incentive was designed to run over the next five years to avoid causing an increase in COE premiums for motorcycles.
In addition, some owners might decide that they do not need a new motorcycle after taking up the incentive, reducing the demand for COEs.
However, Mr Masagos said he expects the incentive to have an initial impact on COE prices, albeit not a long-term one.
"There will probably be an immediate impact on reaction," he said. "But because we are giving at least five years for people to make a decision to cash in on de-registering their motorcycles, and also another five years for them to actually use it, we think that it will even out the impact over the years."
Singapore Motor Cycle Trade Association secretary-general Norman Lee told Channel NewsAsia that he expects a short-term dip in COE prices as dealers cash in on surplus stocks of older motorcycles that buyers don't want.
"If such an exercise in the short term is magnified, we should have more unused bikes or old COEs return to the system and appearing by the next quarter to push the prices down," he said.
GOOD VALUE FOR RIDERS?
While Mr Lee expects dealers to take advantage of the incentive, he said riders will be less enthusiastic.
"S$3,500 gets you nothing in the market today," he said. "Compared to today's COE value, it is worth less than five years of usage, and we haven’t factored in the machine price (of a new motorcycle)."
Explaining this, Mr Lee gave the example of an eligible owner who in 2013 renewed his motorcycle's COE for 10 years based on the premium then, which was about S$2,000. If he were to take up the incentive by de-registering his bike now, Mr Lee said he would only get S$3,500, plus less than S$1,000 in COE rebates.
"You can barely buy a COE (with that)," he added. "If you do not touch the bike now, the opportunity cost is only S$1,000 to use the bike for the next five years."
In the last COE exercise, motorcycle premiums closed at S$7,114.
Mr Amri Sidik, who owns a rare Italian-made Vespa scooter registered in 2001, said the S$3,500 incentive might not be enough for riders who own older motorcycles that have a bigger engine capacity and are thus more expensive.
"For smaller bikes it's fine," the 30-year-old said. "But I'm not sure if there should be a tiered thing. S$3,500 for all classes of motorcycles might be unfair to some."
Mr Amri has developed an affinity for his scooter and wants to hold on to it for as long as he can. The self-employed worker intended to keep renewing his scooter's COE, which expires in 2021, every 10 years. But because his bike will not be allowed on the roads beyond 2028, he's had to rethink his plan.
"If we maintain our engines, go for regular servicing and pass the inspections yearly, what's wrong with that?" he said. "I'm not really keen on the incentive. The part where I can't use it beyond 2028 bugs me more."
This incentive is the latest in a slew of measures aimed at reducing vehicular emissions, which NEA said is a “key source” of air pollution here.
Mr Masagos said in Parliament last month that the Government would be reviewing how to reduce vehicular pollution from older, more polluting vehicles.
The minister also said last year that new emission standards for petrol vehicles and motorcycles on the roads would kick in from Apr 1 this year.
The new standards, which are comparable to those in Europe and Japan, would reduce emissions due to “vehicle defects or poor maintenance”, he added.
NEA figures show that Singapore has some way to go in meeting its air quality targets. Last year, the eight-hour mean measurement for ozone was 191 µg/m3. The target is 100 µg/m3 by 2020.
When asked if Singapore is on track to meet the targets, Mr Masagos said: "This and all the initiatives, including how we tighten up our road and industrial emissions, all tie up to meet our WHO (World Health Organization) standards for 2020."