Singapore’s Car Economy: From Luxury Loss to Quick Gain
In most parts of the world, a brand‑new car stitches a hole in a buyer’s wallet the moment they drive it off the lot. In the tiny, affluent island of Singapore, however, the wheel of fortune can spin in the opposite direction.
How a 27‑Year‑Old Proved It
Shi Zheng, a young student juggling academics and the stock market, seized a chance that many would roll their eyes at. He sold his Porsche Panamera, purchased new less than a year earlier, and walked away with a tidy 10 % profit.
“It was a great opportunity to knock some extra cash out of my pocket,” says Shi.
Singapore’s Unique Car‑Quota Drama
Cars in Singapore sit on a 10‑year certificate of entitlement (COE), essentially a license to own a vehicle for a decade. Because the number of these certificates is capped, they’re auctioned – and the auction prices have skyrocketed lately.
Three factors have amplified the COE cost:
- Massive demand post‑Covid‑19.
- An influx of affluent expatriates, especially from Hong Kong.
- Unprecedented economic activities driving up the bidding.
On Monday, October 19, the latest COE auction showed that prices were 40–50 % higher than the same period last year, and a staggering 120–170 % higher than back in 2020. For a tiny cruiser, you’re looking at roughly $81,000; a high‑performance Porsche would pay a whopping $110,000.
Why Singapore Is the Costlier Car Market on Earth
Picture this: a Toyota Corolla Altis packs a punch in Singapore at about $141,000 (after tax and registration), meanwhile, the same model in the United States clocks in at a mere $22,000. The gap? An unimaginable 640 %.
The Second‑Hand Boom
Rapidly rising COE prices have nudged many Singaporeans toward the used‑car scene – a way to grab a buckle‑down voucher bought when the market was cheaper.
SGCarMart, a leading platform for pre‑owned vehicles, reported a 20–25 % jump in listings for the first half of this year compared to last year. “Buyers are timing the market,” says Vinod Cherumadathil, CEO of SGCarMart.
Shi, for now, is taking taxis until the COE price tells a different story.
Going Green: The Real‑World Incentives
Singaporeans modernize their options – the government offers up to $45,000 in rebates for shoppers dipping into electric vehicles (EVs). Despite this, only 2,942 out of 645,150 cars on the road were EVs last year, according to KPMG.
The current COE numbers have caused a tug‑of‑war: people are scrambling for cheaper certificates, while the government tries to push EVs, hoping the future will look cleaner and more affordable.
Takeaway
In Singapore, buying a car may save you money – but only if you’re buying a used model that came with a cheaper COE. For the rest of us, the cost of owning a car remains alarmingly steep, and the next time you pick up the wheel, you might just be bagging a profit instead of a loss.
