Certificate of entitlement (COE) prices ended higher across the board at the latest tender yesterday, with Open and motorcycle premiums recording the biggest rises.
Industry players said bidding was fuelled by panic buying, which was triggered by fears of imminent price hikes from July when a stricter carbon tax scheme is due to kick in.
The COE premium for cars up to 1,600cc and 130bhp rose by 4.7 per cent to close at $67,749. while that for cars above 1,600cc or 130bhp climbed 6.6 per cent to finish at $76,612.
The price for Open COE, which can be used for any vehicle type but ends up mainly for bigger cars, shot up by 8.2 per cent to hit a 12-month high of $78,000.
Commercial vehicle COE premium rose by 6.7 per cent to close at a five-month high of $64,001. Motorbike COE premium also soared by 12.5 per cent to reach a new high of $6,312.
Singapore Vehicle Traders Association secretary Raymond Tang said news of a revised Carbon Emissions-based Vehicle Scheme - announced in late February - was the main cause of the climb.
Since then, car COE prices have risen by between 14.8 per cent and 18.4 per cent, or an average of $10,000.
People who have bought in this period in an effort to avoid a $5,000 to $15,000 rise in prices would have had their savings largely negated by the COE hike.
Mr Tang said: "People hear from friends that they should buy now because prices will go up from July. But they don't know why, or by how much.
"There is no logic and of course, the dealers are not going to tell them otherwise."
Mr Nicholas Wong, general manager of Honda agent Kah Motor, said the long time lapse between the announcement of the revised scheme and its implementation date was behind the reaction from consumers.
Motor traders also said the curb on car loans has lost its sting, as dealers have all but found ways around it.
Meanwhile, motorcycle dealers were shocked by the latest bike premium.
Mr Wilson Phoon, managing director of leading dealer AS Phoon, said he expected a rise as there has been a series of new launches of key models.
But he added: "I didn't expect it to go up by this much."
Market watchers said speculators - who resell COEs for a profit - may also have contributed to the premium rise.
This article was first published on April 9, 2015.
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