Review of COEs for Motorcycles

Ms Joan Pereira asked the Minister for Transport whether the Ministry will consider (i) keeping deregistrations of motorcycle Certificates of Entitlement (COE) within the Motorcycles' category instead of the Open category; and (ii) establishing separate COE quotas for normal and luxury motorcycles.

Assoc Prof Fatimah Lateef asked the Minister for Transport whether there can be a review of the Certificate of Entitlement for motorcycles.

The Senior Minister of State for Transport (Mr Ng Chee Meng) (for the Minister for Transport): Mdm Speaker, with your permission, I would like to take Question Nos 15 and 16 together.

Mdm Speaker: Yes, please.

Mr Ng Chee Meng: Mdm Speaker, the recent rise in motorcycle COE prices has understandably raised concerns.

Category E COEs, which can be used to register vehicles from any category, are intended to allow the vehicle mix to evolve as market demand changes. Currently, all vehicle categories contribute 10% of their quota to Category E. This rate has been gradually reduced from 25% over the last three years, with the most recent reduction to 10% taking effect in February 2015.

Motorcycles are in a separate COE category so that motorcycle buyers need not compete with car buyers for COEs. We have received suggestions in the past to split the motorcycle COE category. However, unlike for cars, the quota for motorcycles is small. Last quarter, for instance, the Category D COE quota was about 2,000. Dividing Category D into even smaller sub-categories may result in significant volatility in their COE prices. It was, in fact, for this very reason that the Government Parliamentary Committee that reviewed the COE system back in 1999 had recommended to merge the then-four car categories into the present two.

We will continue to review the COE framework, including the Category E contribution rate, and make adjustments if required.