In the compact city-state of Singapore, owning a car has always been considered a luxury, primarily due to the unique and stringent vehicle quota system, which has recently seen prices soaring to unprecedented heights. The Certificate of Entitlement (COE), a mandatory 10-year ownership certificate introduced in 1990, has reached a staggering cost of $106,000, equivalent to purchasing four Toyota Camry Hybrids in the United States. This system, designed to manage and control the number of vehicles in the diminutive nation, has positioned Singapore as the most priciest city globally to own a car.
The Mechanics Behind the COE
The COE system operates on a bidding process, with the quota being determined by the number of vehicles deregistered. In 2020, during a period of reduced driving due to the pandemic, COE prices dipped to around S$30,000. However, a post-pandemic economic resurgence has triggered an uptick in car purchases, while the total number of vehicles remains capped at approximately 950,000. As a result, the Certificate of Entitlement (COE) for a sizable vehicle has surged, quadrupling from its 2020 value and achieving an unprecedented S$146,002 ($106,376.68) this Wednesday.
The Impact on Singaporeans
The soaring COE prices have rendered car ownership beyond the reach of many middle-class Singaporeans, impacting what sociologist Tan Ern Ser refers to as the “Singapore Dream” — a vision of upward social mobility symbolized by cash, a condominium, and a car. Holding a median yearly household income of S$121,188, Singaporeans find the aspiration to possess a car becoming increasingly elusive for many. Some Singaporeans, like Jason Guan, have adapted by forgoing car ownership, instead appreciating other aspects of life in Singapore, such as its robust education system and high levels of security.
A Closer Look at the Figures
The financial implications of the COE are starkly evident when comparing car prices in Singapore to those in the U.S. Including the COE, registration fees, and taxes, a new standard Toyota Camry Hybrid is priced at S$251,388 ($183,000) in Singapore, in stark contrast to $28,855 in the U.S. This price discrepancy underscores the financial burden placed on Singaporeans aspiring to own a vehicle, prompting a shift in lifestyle and transportation choices.
The escalating costs of vehicle ownership in Singapore, driven by the COE system, have sparked debates and discussions about social mobility, lifestyle, and the evolving “Singapore Dream.” As residents navigate through these soaring prices, the focus may shift towards leveraging the nation’s efficient public transport system and exploring alternative modes of transportation.
