In a rare move, one of the world’s leading suppliers of automotive components, Robert Bosch (South East Asia), has voiced its concerns about the Land Transport Authority’s (LTA) move to layer on engine power capacity in the classification of small cars for the Certificate of Entitlement system.
Asking the LTA to “reconsider” the new criterion for Category A cars, the company outlined two “unfavourable outcomes” from the tweak, which was announced on Monday and will be implemented in February.
First, manufacturers and dealers will bring into the market cars with “outdated technologies”, which are less fuel-efficient and will emit more carbon dioxide.
“This is a regressive step towards meeting the Singapore Government’s target of lowering overall carbon emissions by 11 per cent (potentially 16 per cent) by 2020,” Bosch said in a statement.
Second, it argued, manufacturers may try to meet the new 97 kilowatts criterion for cars with engine capacities of 1,600cc by curbing engine power output to pass pre-registration inspection tests. This could be done by encoding a limiter within the engine control unit of the vehicle.
Said Bosch: “This limitation can be easily removed after the vehicle leaves the showroom and is not easily detected during mandatory vehicular checks.”
It added: “Introduction of engine power into the COE system favours old technologies and is detrimental to the quality of life for Singaporeans, as it does not achieve a reduction in emission levels.”
Speaking to TODAY, Mr Klaus Landhaeusser, Bosch’s Regional Head, External Affairs and Governmental Relations (South-east Asia), added that the new regulations may lead to more car owners choosing to illegally modify their cars by leveraging on technology to circumvent the limiter placed in the vehicles.
While there are already laws in place against such illegal modifications, Mr Landhaeusser said tracking the horsepower of a car requires a chassis dynamometer, which regular vehicle inspection companies do not have as engine power inspections are not required in regular vehicle checks.
He said: “This is a very expensive machine and … it is only available in workshops which do the tuning themselves.” Bringing in the chassis dynamo systems will add costs to inspection companies, he added.
When asked why Bosch is concerned about the criterion, Mr Landhaeusser said: “We are developing systems for all car manufacturers, whether it is new or old technologies. We also have a very strong lead when it comes to saving the environment.”
In response, the LTA reiterated that it will be implementing “pre-registration safeguards through its vehicle type approval process”. The authority said it will not approve car models which have maximum power output specification that is lower than the same models approved previously, or what has been declared in other markets.
“This will serve as a deterrent against anyone who tries to tune down the maximum power output of his car to qualify for Cat A,” it added.
TODAY understands that the LTA has also brought in chassis dynamometers for the inspection of vehicle engine power.
On car manufacturers bringing in models which are less environmentally-friendly, the LTA said carbon emissions are already accounted for under the Carbon Emissions-based Vehicle Scheme.
“Carbon emissions and fuel efficiency are not good proxies for the value of a car, and could end up penalising mass-market models,” said an LTA spokesperson. The authority also emphasised that it will “review the criteria every few years and consider if adjustments are necessary”.
Dealers TODAY spoke to felt that most owners will not choose to illegally modify their cars.
Singapore Vehicle Traders Association Honorary Secretary Raymond Tang said: “Most car buyers usually go for luxury or continental cars just for the brand name and the status that comes with it. They are usually not so concerned about engine power.”
Motor Traders Association President Glenn Tan also pointed to liability problems of illegally modifying cars. “If they do that, they void the entire warranty of the vehicle because they are forcing it to work outside the operating perimeters of the vehicle,” he said.
“Also, there is an insurance and product liability problem. If you tune it outside of what is promulgated, the insurance can choose not to cover your vehicle. If you kill somebody, there is criminal liability.
“Whoever tunes it illegally, be it the dealers or the consumers, they will have some hand in criminal liability and they have to bear this in mind as well,” Mr Tan added.
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So, the loopholes are covered by LTA. Cars with a different power rating as opposed to the official specs release will not be granted access to Singapore's market. Therefore, the prospect of down tuning car engines will not happen nor help the case.
Certificate of Entitlement (COE) prices rose across the board for all categories.
In the latest bidding exercise, the COE price for the open category experienced the biggest jump -- rising by S$7,001 to hit S$83,001.
The next biggest jump was in the big cars category, with premiums going up by S$6,751 to S$81,751.
The premium for small cars went up S$2,602 to S$69,903.
COE prices for commercial vehicles rose S$1,012 to hit S$59,001.
As for motorcycles, the COE price went up by S$11 to reach S$1,712.
From next month, the government will start imposing registration surcharges on cars with high carbon emissions under the new Carbon Emissions-Based Vehicle Scheme (CEVS).
Buyers of such cars will have to cough up between S$5,000 and S$20,000.
Motor traders said car buyers who wish to avoid the penalties are driving up COE prices in the latest bidding round.
Neo Tiam Ting, president of the Singapore Vehicle Traders Association, said: "The CEVS come in not only for Category B vehicles but for all vehicles, but Cat B vehicles will be affected more. Those in Cat B, those with high-capacity cars will be affected more, that's why the COE goes up more than A."
Motor traders said higher prices for big cars are also due to the perception that authorities will be fine-tuning the categorisation of COEs to further segregate higher-end models from cheaper ones.
Eddie Loo, managing director of CarTimes Automobile, said: "After the re-categorisation, I think it will put much more pressure on Cat B. So I think for the luxury cars, premiums will still be going up. Before they reach S$100,000, I think it is better to go into the market first."
The public has until July 7 to give their suggestions on ways to refine the COE system.
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New rulings are forcing everyone to jump into the market now causing a relatively huge jump in premiums across the board. The Cat B buyers will be experiencing very high premiums until the rulings are finally in place. For now, let the figures rise.
The Government will stick with its plan to
cut annual vehicle population growth to 0.5 per cent from 1 per cent
from February, said Transport Minister Lui Tuck Yew.
Speaking on the sidelines of a visit to SMRT's Bishan depot Thursday
morning, Mr Lui was asked about the record Certificate of Entitlement
prices. Category A premiums for instance, breached $92,000 at the latest
tender on Wednesday - the highest in history.
Mr Lui in response said that 45 per cent of households here already
own at least one car, and noted that there may not be much more room for
a higher percentage since "about 12 per cent of space" is already
occupied by roads.
He said the high COE prices was not only a function of supply - the
smallest since the quota system started in 1990 - but also the robust
economy and people's ability and willingness to spend. Mr Lui added that
he has asked the Land Transport Authority to look into whether the
newly-introduced Carbon emissions-based Vehicle Scheme (CEVS) - which
accords lower emission cars rebates of up to $20,000 - had led to more
aggressive COE bidding.
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It is here to stay, and I agree with him that COE quotas need to be reduced, or else the driving experience on our roads will turn for the worse. For those who are looking to get a car, perhaps a second hand one will be a more viable option.
Come 2015, I believe a lot of cars will be de-registered. Till then, prepare yourselves for crazy COE prices.
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.
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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.
