SINGAPORE: The Certificate of Entitlement (COE) bidding exercises will resume from Jul 6, as motor vehicle dealerships and showrooms open for business in Phase 2 of Singapore's reopening on Friday (Jun 19).
This will give motor dealers and vehicle buyers a two-week window to plan and confirm purchases before bidding exercises start again every first and third Mondays of each month, the Land Transport Authority (LTA) announced in a news release on Thursday.
The accumulated COE quota of 19,490 from the suspended bidding exercises from April to June will be returned to the market over the next 12 months, from July 2020 to June 2021, said LTA.
One-third of the accumulated quota will be returned over the first three months from July to September 2020, with an additional 6,494 COEs across all categories.
The remaining two-thirds will be returned over the next nine months from October 2020 to June 2021, with an additional 12,996 COEs across all categories.
"LTA has considered the need to ensure sufficient supply of COEs to meet the orders that have built up during the period of COE bidding suspension, as well as the need to smoothen the supply of COEs to ensure long-term market stability," said the authority.
Speaking to CNA journalist Gwyneth Teo in an interview on Thursday, Transport Minister Khaw Boon Wan said the authorities had done "quite a number of simulations" before deciding on the best way to return the COEs to the market.
"There are actually several ways to return the COEs to the market, but you want to do it in a way which does not cause a shock or glut to the COE market," he said.
A glut of certificates could cause prices to plunge, which could cause "severe difficulty" to second-hand motor dealers with an existing inventory of cars, he added.
"Our concern must be the long term stability of the market," said Mr Khaw, noting that such an oversupply could result in another spike 10 years down the road when the COEs expire.
"The better way is to ensure a steady, sustainable growth of the market, that I think is much better for everybody."
COE QUOTA FOR JULY
For the month of July, the COE quota for the bidding exercises will be 8,737.
Category A, which is for cars up to 1,600cc and maximum power output not exceeding 97kW, will have a quota of 2,568 COEs.
Category B, which is for cars above 1,600cc or maximum power output above 97kW, will have a quota of 2,581.
The quota for goods vehicles and buses in Category C is 978.
For motorcycles in Category D, the COE quota is 1,727, while open category vehicles will have a quota of 883 COEs.
The next COE quota announcement for the bidding period from August 2020 to October 2020 will be made in July.
COE bidding exercises have been suspended since April, as motor dealerships and showrooms closed as part of nationwide measures to stem the spread of COVID-19.
Most activities will resume in Phase 2 of Singapore's reopening, subject to safe distancing measures.