Cat A COE premium hits new record of $119,003

The piece of paper required to own a basic family car in Singapore now costs well over SGD 100,000, a figure that has decisively surpassed the country’s median annual household income from work, which stands at SGD 123,780. This is not a temporary anomaly but the stark reality of a system where the right to own a vehicle has been transformed into a volatile, high-value luxury asset, fundamentally distorting personal finance decisions for a generation. The dream of car ownership, once a tangible marker of middle-class success, has devolved into a financial trap, forcing a painful re-evaluation of aspirations, budgets, and the very definition of a "good life" in the city-state.

The journey to a six-figure Certificate of Entitlement (COE) was not a sudden leap but a relentless, grinding ascent that has left most salaried Singaporeans behind. A decade ago, a Category A COE hovered around SGD 60,000 to SGD 70,000; two decades ago, it was often below SGD 30,000. Today's prices are the direct consequence of a deliberate and long-standing government policy to achieve a "car-lite" vision by enforcing a near-zero growth rate for the private vehicle population. The system, designed to control traffic on a small island, operates on a simple, brutal principle of supply and demand. Through a fortnightly bidding exercise, a severely limited quota of COEs is released, turning the process into a high-stakes auction dominated by those with the deepest pockets.

The COE is merely the price of admission; the total cost of putting a car on the road is where the financial devastation truly begins. Singapore’s multi-layered vehicle taxation system is designed to be punitive. On top of the car’s base value (Open Market Value or OMV), buyers must pay an Additional Registration Fee (ARF). This is a tiered tax that stands at 100% for the first SGD 40,000 of the OMV, escalating sharply to 190% for the next SGD 40,000, and a punishing 320% for any value thereafter. This means a luxury vehicle with an OMV of SGD 100,000 would incur an ARF of SGD 198,000, before the COE is even factored in. Add Goods and Services Tax (GST), excise duties, and dealer margins, and a modest sedan with a factory cost of SGD 30,000 can easily command a showroom price of SGD 180,000 or more.

The narrative that COE prices are driven solely by wealthy individuals craving luxury cars is incomplete. A significant and consistent source of demand comes from the private-hire vehicle (PHV) and car-leasing industries. The PHV population has swelled in the last decade, with thousands of cars registered to companies like Grab, Gojek, or their fleet partners. These corporations are price-inelastic bidders; securing a COE is an operational necessity, and the cost is simply passed on to their drivers and, ultimately, consumers. This relentless corporate demand establishes a high price floor in bidding exercises, competing directly with families bidding with their personal savings.

For the vast majority of Singaporeans, the dream of car ownership is broken. Continuing to chase it based on outdated social norms is a recipe for financial hardship. The only rational path forward is a fundamental recalibration of both mindset and financial strategy. The goal must shift from "ownership" to "access to mobility." This means meticulously calculating the Total Cost of Mobility (TCM) by combining public transport—a network spanning over 200 kilometers of MRT lines with world-class reliability—with judicious use of ride-hailing and hourly car-sharing services like GetGo or BlueSG, which collectively operate thousands of vehicles across the island. For many, an annual TCM of SGD 5,000 to SGD 8,000 can provide comprehensive transport access without the SGD 20,000+ annual burden of owning a car.