COE prices expected to climb as demand for Chinese electric vehicles rises

SINGAPORE: Market analysts are forecasting a short to medium-term increase in the price of a successful Certificate of Entitlement (COE) as demand for electric vehicles (EV) in Singapore rises, particularly driven by Chinese manufacturers.

Industry experts told CNA that they have noted a significant uptick in the adoption of electric vehicles within Singapore, with Chinese brands leading the charge. Data reveals that BYD, a prominent Chinese EV maker, represented over 40% of all new electric vehicle registrations in the first half of this year.

The market is expected to become even more competitive with the anticipated entry of other Chinese EV brands such as Xpeng and Zeekr.

An electric vehicle business information company highlighted that the influx of new brands into Singapore’s EV market is likely to intensify competition for COEs, thereby driving up prices.

The rising interest in EVs is not solely due to local consumer preferences but also a strategic pivot by Chinese automakers. Faced with tariffs imposed by the European Union and the United States, these manufacturers are increasingly targeting more welcoming markets like Singapore.

Vantage Automotive, the authorized distributor for BYD in Singapore, reported robust sales figures, selling approximately 1,400 electric vehicles last year and surpassing 2,000 units sold so far this year. This surge indicates the growing acceptance and popularity of electric vehicles among Singaporean drivers.

Conversely, non-Chinese EV brands are struggling to gain traction in the local market. Komoco Motors, the Singapore agent for South Korea’s Hyundai, attributed its stagnant electric car sales to rising inflation, a limited COE quota, and the competitive pricing of Chinese-made EVs.

As more Chinese electric vehicles populate Singapore’s roads, the demand for COEs is expected to soar, inevitably leading to higher prices.

TISG/