That raised questions among netizens about whether a similar approach would help to bring COE prices for cars down.
Transport economist Walter Theseira said the new measures worked to discourage speculation because motorcycle dealers tend to hold on to a stock of temporary COEs. They profit when COE premiums rise because they can sell the motorcycle for a higher price even though the certificate was purchased at a cheaper rate.
Buyers are unlikely to be willing to pay the same price for a car that has one previous owner, even if it is the dealer’s company.It is very risky for car dealers to hold COEs speculatively or to use them to register vehicles in their own name, when very expensive depreciation starts the moment registration is completed,”Motorcycle dealers who have a large stock of COEs have an incentive to try to control the market price.
Mr David, a manager at SgMotoringHub, said small parallel importers may need to ask their buyers for larger deposits if the bid deposit is increased. Dealers hold varying inventory, with some models only imported when an order is signed. Others may sell new models before the inventory arrives.
Source: News Formal (newsformal.com)
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