FarBird's take on spike of Singapore's COE prices in April 2010

For those whom don't yet already know of Singapore's method of issuing new car registrations, please have a read at Wikipedia's entry on COE.


Ok, now listen to my take on why the COE went up so sharply in early April 2010.

The COE price of the different classes of vehicles are determined by a quota bidding system.

This means that if there are 100 vehicles that got de-registered last month, there will be 100 new COEs up for grabs in the upcoming bid. If 200 potential car owners cast their bid for the COE, the price of the COE will be determined by the 100th decremental bid price casted.