Letter to the editor: Buying COE is not a stock transaction
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The Certificate of Entitlement or COE should not be used for trading like the stock market.
COEs are intended to regulate the number of new cars allowed on the roads so as not to cause traffic jams on the roads.
However, this is not the case. Although auto showrooms on Leng Kee Rd were reported to be devoid of customers last week, the COE ‘open’ and ‘big’ car categories saw prices hit the $100,000 mark !
So who is timing the market?
Since there are no car buyers, we can categorically say that there are NO individual COE bidders.
By this simple analogy, it seems obvious that traders and industry players command and distort the market.
As the aim of the COE is to keep a constant flow of new vehicles on the road, the Land Transport Authority (LTA) surely knows that allowing traders to offer COEs in bulk would eventually lead to trades and freewheeling.
With 11,951 new COEs released from May to July 2022, LTA is set to reign supreme in this wholesale merchant bidding craze. LTA should only allow individuals to bid for their COEs.
Industry players can help car buyers bid for COEs, but bidders must be named.
The transfer of COE should be prohibited to avoid market distortion and the validity of certificates should be reduced to 3 months in line with the recently reduced validity for motorcycles.
LTA should conduct this review immediately to avoid further runaway COE prices.
The views expressed here are those of the author/contributor and do not necessarily represent the views of Independent Singapore.
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