Latest COE Prices Analysis (July 2022) - Does renting a car make more financial sense?

Certificate of Entitlement (COE) prices have been the talk of the town ever since COE premiums crossed the $100,000 mark in both Categories B and E on June 8.

This marks the highest COE prices in close to 30 years, when premiums for the then Category 4 cars surged to $110,500 in December 1994.

Read on as we deep dive into the historical prices of COE, as well as evaluate the options you have if you want to drive without worrying about COE prices, depreciation and more!

What is a Certificate of Entitlement (COE)?

A Certificate of Entitlement (COE) gives you the right to own and use a vehicle in Singapore. Yes, a COE is a very expensive piece of paper that often costs more than the car itself.

You can bid for a COE during the open bidding exercises that are conducted twice a month.

To put it simply, COE prices are determined by demand and supply. The Land Transport Authority (LTA) controls the supply and decides on the COE quota available for bidding. This is to prevent traffic congestion and reduce car ownership in Singapore by driving up the costs of owning a car.

COEs are divided into 5 categories, and are grouped according to vehicle class:

Category A

Car, except fully electric cars, with engine capacity of up to 1,600cc and power output of up to 97kW (130bhp); and fully electric car with power output of up to 110kW (147bhp)

Category B

Car, except fully electric car, with engine capacity above 1,600cc or power output above 97kW (130bhp); and fully electric car with Maximum Power Output above 110kW (147bhp)

Category C

Goods vehicles and buses

Category D

Motorcycles

Category E

Open (for all except for motorcycles)

Current COE Prices (July 2022)

Latest COE prices from the first bidding exercise in July 2022:

In this round, there was a COE quota of 2,023, with 2,823 bids received across the 5 COE categories. COE premiums for July 2022 saw an increase across all categories, notably for Category A (≤ 1600cc & 97kW), where it increased by $3,012 as compared to June 2022 (2nd bidding).

Historical COE Prices

COE Prices (except Motorcycle) from April 2002 to July 2022

COE prices for cars have steadily increased, rising to $78,001 (Category A) and $107,800 (Category B) in July 2022. Gone were the days when COE prices were less than a couple thousand dollars. Did you know that the lowest COE price recorded was just $2? In November 2008, amidst the global financial crisis, the lowest successful bid for a COE was $2 – less than a plate of chicken rice!

COE Prices (Motorcycle) from April 2002 to July 2022

COE prices for motorcycles (category D) have also seen a similar trend, with prices rising steadily over the years, reaching $10,889 in July 2022.

Given Singapore’s small land size, the quota for COEs will always be limited. While the actual price of COEs is difficult to predict, it may be worthwhile looking at historical and the latest COE price trends to help you make better predictions.

Should you rent a car instead?

If you’re looking to own a car to drive for Grab (full-time/part-time), purchasing a brand new or used car requires a high capital outlay.

With exorbitantly priced COE premiums, car rental is fast becoming a popular choice. Car rental allows you to enjoy the convenience of owning a car without worrying about COE prices, maintenance, insurance, depreciation and more.

Here are some reasons to rent a car from GrabRentals:

Low upfront cash needed

$500 – $1000 upfront deposit vs up to $50,000 (30-40% downpayment)*

- Upfront deposit for renting a car ranges from $500 – $1000, as compared to 30-40% downpayment if you’re purchasing a car
  *Assuming that a brand new Toyota Sienta Hybrid is priced at $140,000, that amounts to $49,000 upfront cash required at a 35% downpayment.

Service and maintenance of vehicle by trusted workshop for free

Save up to $378/year for servicing*

- As a general rule of thumb, given the high mileage clocked by PHV drivers, you should be sending your vehicle in for basic servicing with every 10,000 km mileage clocked or every six months, whichever comes first.
  *Purchasing your own car means fronting these cost, which can cost from anywhere between $68 – $188 per servicing, excluding any further cost required to replace damaged parts

Insurance and road tax is covered

Save up to $1,800 – $2,500/year (insurance) + up to $750/year* (road tax)
- PHV drivers are required to obtain PHV vehicle insurance, which costs higher than the usual vehicle insurance for private usage. Not only does GrabRentals provide insurance, we also offer you the option to protect yourself even further with GrabRental’s Collision Damage Waiver (CDW), and reduce your accident-related costs by up to 93% (from as low as $203.74).
- Road tax is also covered by GrabRentals
  *For a car with engine capacity (EC) of 1,600cc

Up to 31% fuel discount
- Save up to $17/day* ($6,200/year) with 31% fuel discount!**
  *Based on an average of 190km/day mileage clocked for Mazda 3
  **29% upfront Caltex discount + 2% rebate from GrabRentals into driver wallet

Enjoy loyalty perks, rebates & more

- All GrabRentals hirer-partners are auto-enrolled into the GRNavigate loyalty program, where the wheels earned can be used to offset rental fees or redeem items from the redemption catalogue
- New hirer-partners who sign with us or existing hirer-partners who recontract can also enjoy sign on bonuses and/or fuel vouchers

In conclusion...

Renting a car allows you to free up your finances without incurring hefty downpayment. You’ll also get to enjoy additional savings for vehicle insurance, road tax, servicing, and from fuel discounts. Enjoy the same benefits of a car without worrying about the annual car depreciation or rising COE prices!

GrabRentals is the largest private-hire car rental fleet in Singapore. Whether you are interested in petrol, hybrid or electric cars, we have a wide-ranging vehicle fleet available for you.

For more information on which car model best suits your needs, do check out our article “Should I drive a Petrol, Hybrid or Electric car for Grab”

For new hirer-partners, you may visit our website here to book your car online. Existing hirer-partners may recontract online here. If you would like to find out more or speak to our customer helpdesk, you can also book an appointment at Grab@Tampines or chat with us on our Facebook page.