Volkswagen dominates small-car COE category

Almost one in four cars sold with Category A certificates of entitlement (COE) this year wore a Volkswagen badge on its grille.

In the first 10 months, the German mid-range manufacturer accounted for 2,352 of the total 10,142 registrations in Cat A (for cars under 1,600 cc). This was 23.2 per cent of the market share for this so-called small-car segment.

From January to October, the top VW model was the Jetta compact sedan, with 744 registrations, followed by the Scirocco sports hatch (416) and the Golf hatchback (408).

But in Cat B, VW is a small player. There, German luxury makes BMW and Mercedes-Benz take the top two spots.

In this COE category, VW has managed only 595 units or 4.5 per cent in a total big-car market of 13,327 new registrations.

VW's domination of the small-car COE category has come at the expense of the traditional Japanese favourites; for now, the German car has pushed them all out except for one - Toyota.

Japan's biggest carmaker was Singapore's best- selling brand between 2002 and 2010, before it was overtaken by BMW and Mercedes-Benz last year. Today, it is still the third most popular make here, with VW in fourth position.

VW sales could, however, expand further amid the tight COE quota, under which the popularity of premium and near-premium makes has risen in tandem with COE prices.

VW could also clock even better sales through its full range of diesel models, which make their debut next month to take advantage of the upcoming Carbon Emissions-based Vehicle Scheme (CEVS).

The 11 Volkswagen "TDI Clean Diesel" models are the Polo, Beetle, Scirocco, Touran, Jetta, Tiguan, Passat, Sharan, CC, Touareg and Phaeton.

Under CEVS, which comes into effect on Jan 1, buyers of cars with carbon dioxide emissions of 160 g/km or below are entitled to rebates of between $5,000 and $20,000.

VW is already in a strong position to benefit from this; in the first nine months of this year, 82 per cent of its cars sold already had emissions of 160 g/km or less.

So even though Euro V diesel models attract a diesel tax of 40 cents per cc next year - down from $1.25 per cc currently - the CEVS rebate may more than make up for this surcharge.

Volkswagen's PR manager Colin Yong said: "For most Volkswagen models, the additional CEVS rebate earned by the TDI models more than covers the slightly higher annual road tax, which includes the diesel surcharge."

For example, the road tax for the Jetta 1.6 TDI is $762 more a year than that of the 1.4 TSI model, but the Jetta 1.6 buyer will get $5,000 off upfront when registering the car - which equates to more than six years' worth of the road tax difference.

Mr Yong said: "Additionally, TDI cars also have even lower fuel consumption than our already economical TSI models, and customers pay less for diesel fuel at the pumps."

The TDI cars here will be sold at the same price as their equivalent petrol models. In Europe, diesel models usually cost 10 per cent more than their petrol versions.

Mr Yong said that VW expects Singaporean motorists to be curious about diesel technology and the potential savings, so it will open a TDI Clean Diesel Experience Centre in its Alexandra showroom.

Most motorists here have not had the opportunity to drive a modern TDI car, so the showroom will give them a shot at feeling the performance and the quiet running of a TDI Clean Diesel car for themselves, Mr Yong added.

SOURCE

When the CEVS scheme kicks in in 2013, diesel powered cars will be very popular and one of the first makers to benefit from this is definitely Volkswagen.

Diesel engines give high torque, good fuel efficiency and diesel prices are lower in Singapore. The only worry comes in when more and more people move into diesel cars and its price starts rocketing, causing our public transport to succumb to price pressures and the consumers will bear the extra fuel costs again.