Car dealers, car rental business expect gloomier outlook
after Lunar New Year
SINGAPORE: COE prices have plunged, with the premium for
big cars nosediving to S$200 recently.
Despite that, industry experts said sales will most likely go down
after the Lunar New Year.
To attract more customers, Honda is absorbing the COE premiums for
small and big cars.
Vincent Ng, Honda's product manager, said: "In the past, COE levels
were very high and it's not within our profit margin to absorb the
COE. But at this level, we are still able to do so."
With the promotion, sales have gone up slightly.
But with fewer people deregistering their cars, coupled with
economic uncertainties and the upcoming reduction of the COE quota,
dealers are cautious about the future.
Mr Ng said: "One of the biggest cut will come from the allowed
(vehicle) growth which the Transport Minister has already
announced...it's going to be cut from 3% to 1.5%. That itself will
already result in more than 13,000 COEs being taken away from the
quota next year."
Meanwhile, the Lunar New Year week is the peak period for car
rental business.
But for this year, companies said business has dropped 20 to 30 per
cent.
Even enquiries fell by some 40 per cent, said a company.
Car rental firms said they will probably have to reduce their fleet
of cars after the Lunar New Year, as they expect a further decline
in business.
- CNA/ir