Latest COE Bidding Results Show Premiums Rising Across All Categories

In the first bidding exercise of May 2026, held on May 4 with results announced on May 6, Certificate of Entitlement (COE) premiums surged across every category. Category A, which covers cars up to 1,600cc or 130 horsepower (or electric vehicles up to 110kW), closed at S$124,790, marking a 1.45 percent increase or S$1,780 from the previous round. This brings it perilously close to the psychologically significant S$125,000 mark and inches toward its all-time high of S$128,105 set in previous years.

Other categories saw even steeper climbs: Category B for larger cars jumped 4.33 percent to S$126,236, Category C for goods vehicles and buses rose 4.76 percent to S$87,479, Category D for motorcycles increased 1.74 percent to S$9,452, and the Open Category E hit S$127,700, up 2.16 percent. With 3,260 COEs available and 5,042 bids received, demand far outstripped supply, particularly in Category A where 2,071 bids chased just 1,301 slots.

This marks the sixth consecutive rise for Category A and Category C premiums, signaling persistent pressure on Singapore's vehicle ownership market.

Decoding Category A: The Mainstream Car Segment Under Pressure

Category A COE applies to mass-market cars, including sedans, hatchbacks, and many electric vehicles (EVs) with power ratings up to 110kW. Its premium directly influences the final price of popular models like the Toyota Corolla, Honda City, or BYD Atto 3. At S$124,790, it now forms a massive chunk—often over half—of a new car's total cost, pushing entry-level models beyond S$200,000.

The convergence with Category B prices, where B briefly dipped below A in recent rounds, highlights manufacturers tweaking engine specs or EV power outputs to qualify for the supposedly cheaper Category A. This has prompted the Land Transport Authority (LTA) to review categorisation to prevent gaming of the system.

Historical Context: A Decade of Volatility in COE Prices

COE premiums have fluctuated wildly over the years, tied to a 10-year supply cycle based on vehicle deregistrations. From lows around S$50,000 in the early 2010s to peaks exceeding S$128,000, the current surge echoes 2023's highs. In late 2025, prices softened to below S$110,000 amid quota boosts, but rebounded sharply from February 2026 onward.

Over the past six months, Category A has climbed from S$102,009 (Jan 1st) to today's near-S$125,000, a 22 percent gain. This pattern reflects inelastic demand: as incomes rise, more Singaporeans aspire to car ownership despite costs.

Factors Fueling the Current Surge

Several intertwined elements are driving premiums skyward:

• Robust Local Demand: Individual buyers, not fleets or foreigners, account for most bids. Economic growth and rising household wealth sustain interest.
• Chinese EV Influx: Affordable EVs like those from BYD and GAC fit Category A, drawing first-time buyers amid green incentives.
• Supply Constraints: Despite a 1 percent quota hike to 19,052 for May-July, growth is capped at zero long-term to manage congestion.
• Policy Shifts: Uncertainty over Vehicular Emissions Scheme (VES) changes post-2025 and Additional Registration Fee (ARF) tiers adds bidding frenzy.
• Market Competition: Record car brands and models intensify dealer pushes to clear inventory.

For deeper quota insights, see the LTA's official announcement.

Ripple Effects on New Car Buyers and Dealers

Aspirational buyers face sticker shock: a S$150,000 base car balloons to over S$280,000 with COE, ARF (up to 180 percent progressive), GST, and road tax. Many delay purchases, opting for public transport or rentals. Dealers report slower sales but note used car upticks as owners hold longer.

Commercial sectors hurt too—Category C's climb raises logistics costs, potentially feeding into consumer prices.

Used Car Market Booms Amid New Car Affordability Crunch

High premiums prop up resale values: cars with remaining COE fetch premiums, narrowing the new-vs-used gap. Buyers shift to 5-8-year-old models, extending vehicle life cycles. However, PARF rebates (tied to depreciation) shrink at high COE eras, discouraging early trade-ins.

Encouraging Sustainable Alternatives: Public Transport and Sharing

Singapore's car-lite vision shines through: MRT expansions, bus fleets, and bike-sharing thrive. Car-sharing like BlueSG or GetGo gains traction, costing pennies per km without ownership hassles. High COEs reinforce this, keeping roads fluid and pollution low.

Government Strategies: Quota Tweaks and System Reviews

LTA calibrates supply via replacement COEs (75 percent of deregistered vehicles), 0.25 percent growth for commercials, and buffers like taxi adjustments. Recent injections of up to 20,000 extra COEs offer flexibility. Acting Minister Jeffrey Siow announced a categorisation review to address A-B convergence, gathering public input.

Defending the auction system, officials note it equitably rations scarce road space without subsidies distorting markets. Details on bidding mechanics are in SGCarmart's tracker.

Voices from the Ground: Buyers, Experts, and Industry

Frustrated motorists lament on forums: "Bought at S$112k six weeks ago—now up 11 percent!" Experts like Assoc Prof Walter Theseira attribute persistence to EV demand despite quotas. Dealers advise waiting for quota peaks but warn of volatility.

Analyst perspectives emphasize long-term zero-growth policy: premiums trend up with prosperity. For full coverage, check CNA's report.

Looking Ahead: Predictions and Next Bids

Next bidding: May 20. With May-July quota stable and EV momentum, analysts forecast Category A testing S$128k if demand holds. Potential relief from more deregistrations in 2026's rising supply (up 20 percent for passenger cars). LTA's review could reshape categories by year-end.

Actionable Tips for Navigating High COE Times

• Monitor LTA tenders and Prevailing Quota Premiums (PQP) for bid floors.
• Consider EVs for VES rebates offsetting costs.
• Explore car-sharing or motorcycles (Cat D milder rises).
• Buy used if COE expiry aligns; renew strategically.
• Budget holistically: factor ARF, insurance hikes from high values.

While surging COE prices challenge dreams of car ownership, they underscore Singapore's balanced transport ecosystem.

Photo by Jon Tyson on Unsplash