Next COE bidding??

[danguard]

after i drive and mod so many car...u are right stock is best..speed thrills but kills....

u are right ... but i was blur when just had car then initially and tio poisoned and was no way of turning back .... I would settle for a pure stock BMW 3 series when the COE prices dip makes the overall quantum more affordable i guess

[danguard]

subaru wrx/sti

dun dare to touch this as will be very poisoned ... TC stage 1 all the way to stage 3 then maintenance will die like mad haha ... so not really a good car in terms of escalating maintenance costs though

[radha08]

dun dare to touch this as will be very poisoned ... TC stage 1 all the way to stage 3 then maintenance will die like mad haha ... so not really a good car in terms of escalating maintenance costs though

ha ha u right power corrupts your mind and ur wallet...

[radha08]

u are right ... but i was blur when just had car then initially and tio poisoned and was no way of turning back .... I would settle for a pure stock BMW 3 series when the COE prices dip makes the overall quantum more affordable i guess

now everything screwed must come out a lot of downpayment just to buy...sianzz...i was also aiming 3-series for my wife guess just LL...drive toyota can...

[latour]

Car Buying Costs Breakdown / My Take on MAS ruling and New Tier Tax Structure on ARF

Tuesday, February 26, 2013.



With the new restrictions from MAS on car loans and also on the New Tier Tax Structure on ARF taxes announced as part of Budget 2013, I thought I will list the following out to help people understand car buying in general in Singapore, as I was very surprised that the few people I spoke to and who owned vehicles did not understand or have any clue on how are cars priced in Singapore and what are the factors contributing to the exorbitant amount of cash we paid for our set of wheels in Singapore.


Car prices in Singapore are priced on the following:

A) OMV (Open Market Value): OMV is assessed by the Singapore Customs, taking into account purchase price, freight, insurance and all other charges incidental to the sale and delivery of the car from country of manufacture to Singapore. This means your beloved set of wheels actually costs lesser from the manufacturer and the OMV is not the selling price from the manufacturer to the local authorized dealer. If you are looking for the OMV of any vehicles, you are welcome to click on the following link:

http://www.onemotoring.com.sg/publish/onemotoring/en/lta_information_guidelines/buy_a_new_vehicle/open_market_value.html

B) COE (Certificate of Entitlement): This is pretty much self-explanatory. Every neighborhood Uncle / Aunties /Ah Gong / Ah Ma knows about the COE. We have Cat A, B, C, D, and E. For the benefit of discussion on private motor vehicles, we really only need to be looking at Cat A: (1600CC and below), Cat B: (Above 1600CC), and Cat E: (Open Cat, where we can use it for vehicles in both Either A or B).

There are a lot of critiques on whether the current COE system actually does what it was intended for, and also with many people crying for a revamp of the system, but I’m sure with the new MAS ruling and New Tier tax structure on the ARF announced just last night, these people probably would have wished that they have shut up instead because they just received 1 mega driver slap in their faces from our ruling party despite predictions that COE prices will come down with the new MAS Ruling working hand in hand with the New Tax Rate Structure on ARF if Budget 2013 is approved and moved in Parliament. (mildly is my guess).

C) ARF (Additional Registration Fees) 100% of the OMV based on the existing ruling before Budget 2013. This translates to a pure gravy transfer from our bank account into the government coffer.

With Budget 2013, a new tier ARF tax structure is in place. If the OMV of your dream vehicle is;

Example: OMV of an Entry level BMW 320I is currently at $36, 486 (Based on the link above). The ARF for this vehicle will now be 100% of the first $20,000 and 140% of the remaining $16,486 which is $23,080. Adding both $20,000 and $23,080 gives you the final ARF of $43,080.

You are now paying an extra $6594 ($43,080 - $36,486) because the OMV is > $20,000. So in short, the higher the OMV, the more ARF you pay.

D) Custom Duty: 20% of the OMV. This is a straight up additional form of duty fees imposed on top of the ARF that goes straight to the Government account.

E) GST: 7% GST on the Custom Duty + OMV. A form of consumption taxes that is imposed to transfer your hard earned cash into the government account based on the value of goods that you have consumed.

F) Registration Fees of $140. (Well, someone needs to do the administrative tasks and all the paperwork required right? We have a first world civil services and they really need to be paid).

G) Vehicle Plate Fees of $30. You wheels needs to be properly identified and tag so that it makes our friendly “Summon Auntie” job easier. They do need to take down your car license plate if you have over parked or parked in a lorry lot (sounds familiar?), or for our brave TP who chases you down the PIE at 150km/h.

H) Whatever else more you paid on top of the 7 points above = Authorized Dealer’s profit. You can’t expect them to do all this for you for free, can you? Btw, this is a really very huge margin after you do your calculation. But I don’t blame them. They need to pay good commission to their Sales Executives and also on their marketing campaign (VW is really good at that I must say). In addition, as one of my friends, KC had pointed out, the AD also bears the Warranty of the vehicle for whatever amount of years they promised to you in the sales agreement, together with an "X" number of times of free servicing which they deem ok to dish out.

I) CEV (Carbon Emission Vehicle) Rebates or Surcharge: Finally, after all the 8 points above, we are finally getting some form of rebates (or Surcharges Ha-ha). To keep things simple, rebates are given from $0 to $20,000 if your vehicle is environmentally friendly and penalized with Surcharge from again $0 to $20,000 if it pollutes mother nature and our ozone layer.

To put things into perspective, I will provide an example of a cost breakdown of all factors listed above that makes up the car prices with the New Tier Tax Structure on the ARF with 2 examples below. (I.E. Friendly Family Toyota Altis 1.6L, and a Higher end Luxurious BMW 320I 2.0L )

* Assumption: I have not included the CEV into the calculations for both examples.
* I have also used the COE based on the 2nd Open Bidding for Month of Feb-2013 with the New Tier Tax structure on OMV > $20,000 in Example 2 below for the BMW 320I 2.0L
* Please also note that OMVs values are not always the same even on the same model of vehicles and they fluctuate with every shipment (mild fluctuation really). This in turns cause ARF values to change as well as Custom Duties and GST. Of course COEs are on bidded basics as well. Therefore car prices are always volatile.

Example 1: Toyota Altis 1.6L

1. OMV: $15,270
2. COE: $78,301 (Based on 2nd Open Bidding for Month of Feb-2013 for CAT A)
3. ARF: $15,270 (100% of OMV only since OMV is less than $20,000)
4. Custom Duty: $3,054 (20% of OMV)
5. GST: $1,283 (Based on 7% of OMV + Custom Duty)
6. Registration Fees: $140
7. Vehicle Plate Fees: $30

Total Cost of Car: $113, 348 (Add up all 1 to 7 together)
Borneo Motor List Price: $139,988 (Price with Guaranteed Gold COE within 3 months from Borneo website)
Difference: $26,640 (Translates to Profits for Borneo Motor or whatever they can keep after their operating costs are subtracted.)

Example 2: BMW 320I 2.0L

1. OMV: $36,486
2. COE: $92,667 (Based on 2nd Open Bidding for Month of Feb-2013 for CAT B)
3. ARF: $43,080 (Additional Tax Structure of 140% applies to excess $16,486)
4. Custom Duty: $7,297 (20% of OMV)
5. GST: $3,064 (Based on 7% of OMV + Custom Duty)
6. Registration Fees: $140
7. Vehicle Plate Fees: $30

Total Cost of Car: $182,764 (Add up all 1 to 7 together)
Performance Motor List Price: $216,800
Difference: $34,036 (Translates to Profits for Performance Motor or whatever they can keep after their operating costs are subtracted.)

In conclusion, I hope this article have helped car buyers understand what they are paying for when they go car shopping and also a deeper appreciation of the amount of money that really ends up with the government because if you look at both examples above, significant amount of what you paid for your car goes to them (Point 2, 3, 4, and 5)

With the new MAS ruling already in effect today, many are anticipating that COE will drop due to lesser demand as the lower middle class looks very likely to be squeezed out of the market with a 40% or 50% down payment depending on the types of car they would like to purchase. The middle and upper middle class would also be struggling to purchase a vehicle due to the same reason above and also with the additional higher monthly installment over a 5 years max loan tenure.

This maximum loan tenure of 5 years might also create an adverse impact on the bank’s interest rate (currently at 1.88%). It is highly likely that our banks will be increasing interest rates for car loans now due to shorter loan tenure and smaller amount of principal amount loaned.

My own prediction is prices of COE will drop but the drop will not be significant mainly because COE growth rate is currently reduced to 0.5% from February 2013 onwards and on top of that LTA has also reduced the amount of COE allocated from the total pool for CAT E: Open Category for which is usually used for Luxury Car further from 20% to 15%. With lesser supply, and steady demand. It is very unlikely prices will flucutuate wildy.

The rich will still be able to afford new vehicles as they are cash rich, but in a way they will also be paying more (alot more, really) because of the New Tier tax structure. The New Tier Tax Structure translates to a whopping increment of 180% tax imposed on cars with OMV > $50,000 and believe me when i say that is alot of additional cash they have to shell out just to own a supercar. (Porsche, Lamborghini, and Ferraris are no longer as cheap as it once was to them and if they really do purchase it, we can all shout "Hurray" because Budget 2014 will see those money translates into social spending, hopefully).

In all scenarios, I think the best thing to do now is to exercise constraints and prudence. Cash is King in Singapore. Waiting for the situation to play out and watching how these changes impacts the automobile industry as a whole and how the automobile industry reacts to them will be the better option for now.


Footnote: Entry Level Porsche 911 3.8L OMV average is $132, 053. And we are not even going to talk about Lambo or Ferraris where their OMV are in ranges of $350,000 and up. This translate to an ARF of $20,000 for the first Tier of OMV of 100% , $42,000 on the second tier between $20,001 to $50000 range at 140% , and a whopping $147,695 on the last tier for the remainer amount at 180%.

Effectively, the new ARF for a Porsche now is $209,695, a good $77,000 increase from what it was before. Think about what you want to do with all that money instead.

[phantom_opera]

very good analysis except "cash is king" ....

[Tek888]

My father was a part time used car sales man many years ago, so I grew up with "many" cars.

I also grew up with many cars. My parents owned a plantation and one of my cousins was in the used car business. When he ran out of space in his shops he would park his cars at my place. He got to park the cars for free and I got to try out different cars. I didn't even had a licence then

[minority]

Cash is king everywhere. not just singapore.

[Tek888]

Ooops !
Out from the horses mouth is usually more accurate.
Thanks.

I got my info from http://www.onemotoring.com.sg/publis...ket_value.html

But they say "The OMV obtained serves as your reference only and may differ from the actual OMV of the car you wish to purchase."

if I remember correctly, the OMV from this site is not accurate one. It is calculated based on the 1st car that was brought in for homologation. As the cars value changes constantly based on various factors like exchange rate, etc, it is better to refer to this table for a more accurate OMV.

http://www.onemotoring.com.sg/publis...ost_Update.pdf

If the desired car model is not found here maybe because agent wasn't able to sell any of those....then refer to the other link for estimated OMV.

[Tek888]

now everything screwed must come out a lot of downpayment just to buy...sianzz...i was also aiming 3-series for my wife guess just LL...drive toyota can...

I am trying to downgrade to a small hatch cos I don't drive much nowadays and a hatch is more suitable for my kid when she gets her licence.

[ysyap]

My take on next COE bidding: Cat A - $60k; Cat B - $70k
2nd bidding for March: Cat A - $55k; Cat B - $65k

[radha08]

My take on next COE bidding: Cat A - $60k; Cat B - $70k
2nd bidding for March: Cat A - $55k; Cat B - $65k

BOTTOMLINE...going down...by time my car 10years end of next year coe $10k......then i renew for another 10 years

[bullman]

Waiting eagerly for the next round of COE Bidding. I will be placing my own bid in Cat B.

Hopefully can get it before proceeding to use it for my reserved car.

[ysyap]

BOTTOMLINE...going down...by time my car 10years end of next year coe $10k......then i renew for another 10 years

Yup.. should be going down. If go up, then alert buttons will be sounded... strange strange le.. lol..

[ysyap]

Waiting eagerly for the next round of COE Bidding. I will be placing my own bid in Cat B.

Hopefully can get it before proceeding to use it for my reserved car.

Hope you succeed...

[danguard]

now everything screwed must come out a lot of downpayment just to buy...sianzz...i was also aiming 3-series for my wife guess just LL...drive toyota can...

Alternatively I might get a ford focus ST manual hatchback which packs a huge punch .... Psst psst will make the car perform machiam like super car as well but without the high road tax haha

[eng81157]

http://www.mrbrownshow.com/2013/02/2...eamed-a-dream/

[buttercarp]

http://www.mrbrownshow.com/2013/02/2...eamed-a-dream/

Rotfl!
Sorry I know it is no laughing matter.
Thanks bro eng!

[proud owner]

so now majority thinks COE wud come off ???


i just read online about that Red Farrari that caught fire in singapore ...

if COE drops ... his resale value sure plummet ...

might as well set it on fire ..staged an accident ...and claim insurance???

[kane]

so now majority thinks COE wud come off ???


i just read online about that Red Farrari that caught fire in singapore ...

if COE drops ... his resale value sure plummet ...

might as well set it on fire ..staged an accident ...and claim insurance???

proportionately, i don't think their resale value will plummet as much as those BMW, VW, Audi from a percentage perspective.

[Shanhz]

if safety is a concern, get a 2nd hand ford focus or volvo s40. honda fit dun feel very safe to me. you dun want your son to be cheong-ing everywhere in a fit/jazz.

on COE prices, i reckon $70k corolla will be back on the mkt around mid year.

[moneytalk]

if safety is a concern, get a 2nd hand ford focus or volvo s40. honda fit dun feel very safe to me. you dun want your son to be cheong-ing everywhere in a fit/jazz.

on COE prices, i reckon $70k corolla will be back on the mkt around mid year.

Hope you are right as I am waiting to buy a new car and most probably will get one in May, June or July 2013, depending on the coe prices.

[Rysk]

Hope you are right as I am waiting to buy a new car and most probably will get one in May, June or July 2013, depending on the coe prices.

Think is tough for me to ford out the downpayment now after the latest policy..
Yesterday I just went to Peugeot to "test water".. The sales person confirmed that the downpayment is 50% of the purchase price.. sigh

[minority]

buy left 2 yrs car or 1 yr car loh.. down payment will be less!

[Rysk]

Then better don't change car lor..
Cos my car still 4-yrs to go before scrap or export

[nav14]

if safety is a concern, get a 2nd hand ford focus or volvo s40. honda fit dun feel very safe to me. you dun want your son to be cheong-ing everywhere in a fit/jazz.

on COE prices, i reckon $70k corolla will be back on the mkt around mid year.

I doubt a corolla will be that cheap as long as the present COE quota remains. Financial restrictions will not make as big as an impact as COE supply will on COE prices. There are lots of people waiting at the sidelines to sustain COE prices at around 60k until and if COE supply increases.

[richwang]

The bidding dates for Mar and Apr has been pushed further for a week.


http://app.lta.gov.sg/apps/news/page...e-9a5d9810657b


. The revised COE bidding schedule for March and April 2013 is as follows::

Exercise End Date

1st Exercise, March 2013

13 March 2013

2nd Exercise, March 2013

27 March 2013

1st Exercise, April 2013

10 April 2013

2nd Exercise, April 2013

24 April 2013

[kane]

why need to push back?? if no one wants to bid for the COE then just let the COE tumble lah.

[richwang]

LTA has tried its best to keep the COE revenue high.

From today's newspaper, small cars are selling around 100K. So the COE price should be around 50K.

The demand is still there ...

[kane]

LTA has tried its best to keep the COE revenue high.

From today's newspaper, small cars are selling around 100K. So the COE price should be around 50K.

The demand is still there ...

i see kah motors have put their COE rebate level at around $45+k region.

so many different strategies employed by the various car dealerships. next few bids will be interesting.