The cost of obtaining a certificate of entitlement (COE) has reached all-time highs in Singapore, making car ownership unattainable for many middle-income citizens.
What is a COE?: Singaporeans who wish to purchase a car must participate in the bidding process for a COE, which is part of a system introduced in 1990 to control the number of vehicles in the city-state. Owning a COE gives one the right to own a vehicle that can be used on the road for 10 years.
While the price of COEs dropped in 2020, it has now significantly increased due to the growth in economic activity post-pandemic, reported Reuters.
Significant COE increase: A large car’s COE price has more than quadrupled from 2020 to a record 146,002 Singapore dollars (approximately $106,679), making Singapore the most expensive city globally to buy a car. It now costs at least 104,000 Singapore dollars (approximately $76,000) for the right to own a car in the nation.
When combined with registration fees and taxes, a standard Toyota Camry Hybrid reportedly costs 251,388 Singapore dollars (approximately $183,682), which is significantly higher than its $28,855 cost in the U.S.
“Singapore Dream”: The skyrocketing prices are challenging many citizens’ “Singapore Dream” of upward social mobility, according to sociologist Tan Ern Ser. As the median annual household salary in the nation is 121,188 Singapore dollars (approximately $88,548), some people are selling their cars, bought when COE prices were lower, to make a profit. The situation has led to a shift in aspirations towards a “good enough life” as the cost of car ownership becomes increasingly prohibitive.