From February 2014, the Land Transport Authority (LTA) will refine the COE quota system to make it more responsive to de-registrations.
Currently, the COE quota is determined every six months, taking into account the number of vehicles that were de-registered in the preceding six months. LTA has announced that it will move from this 6-monthly recycling period for determining COE quota to 3-monthly.
The government agency says that this shorter recycling period will enable better and more prompt matching of the number of new COEs to be issued to replace de-registered vehicles. During the COE public consultation sessions held by LTA in mid-2013, shortening of the recycling period was also suggested by some industry players.
LTA explains that this is a good time to implement the change with the current trend of rising vehicle de-registration numbers which is expected to persist until 2016. In such a trend, a 3-month recycling period would be more responsive than a 6-month system in putting back COE quotas into the system to meet demand from owners who have de-registered their vehicles.
Similar to the current system, the quarterly COE quota to be made available will factor in the allowable increase in vehicle population as well as adjustments for the change in taxi population, expired COEs etc. The remaining claw-back of COEs issued as a result of the over-projection of vehicle de-registrations under the previous COE quota methodology would also continue until January 2015 as previously announced.
A total of 9,127 vehicles will be set as the COE quota for the period of February to April 2014 which is about a monthly COE quota of 3,043 for all categories combined (about 5% higher compared to the 2,884 monthly quota that would have been allocated under the status quo). Bidding under this quota will start with the first open bidding exercise in February 2014.
The next announcement of available COE quota will be in April 2014, for the May to July bidding period.
By Terry Xu