The Big Read: More people buying cars amid pandemic, even as those who own them are driving less

Data from LTA showed that the car population had fallen from about 607,000 in 2013 to a low of 547,000 in 2017. Since then, that figure has been consistently on the rise every year.

Even as the pandemic raged, the car population — which excludes taxis and private-hire cars — grew from about 556,000 in January last year to 577,000 as of September this year.

Correspondingly, the number of private-hire cars and taxis had gone down, with private-hire cars falling from about 77,700 to 68,400 over the same period, and taxis falling from about 18,500 to 15,400. The figures partly reflect the immense strain that the transport sector is facing after more than a year of closed borders and community restrictions, which have meant fewer customers and earnings.

Despite the cap on vehicle population growth, Assoc Prof Theseira said that there may be year-to-year fluctuations in the total vehicle population because of the way the COE system works.

Since buyers can hold on to an issued COE for six months before registering for a vehicle, there is some lag between COE issuance and actual motor vehicle registrations. There is also some lag between vehicle deregistrations and the COE being recycled back into the system, which takes place over three months.

In response to queries, an LTA spokesperson said that between 2013 and 2016, there was an overall fall in total vehicle population as there was a rising trend of deregistration for Categories A and B, which comprise cars up to and above 1600cc or 97kW respectively.

After 2016, however, the deregistration trend reversed and began falling each quarter, leading to a rise in total vehicle population even though the total vehicle growth rate for cars was frozen.

“It is expected that the lag effect will even out over time,” the spokesperson said. “This can be seen from the fact that although the 2020 vehicle population is higher than 2018, it is still less than the population in 2013.”

The spokesperson added that another contributing factor to the rise in the private car population is that COEs for Category E (Open category) are often used to register cars in Categories A and B.

Instead of focusing on car numbers, Assoc Prof Theseira said that a better indication of demand would be to look at people’s willingness to pay for COEs and recent prices indicate that there is “robust demand for private car ownership”.

Since February last year, COE prices for Categories A and B have trended upwards and in recent months, surged.

The COE price for Category A cars rose from S$30,010 in early February last year to S$53,709 in the latest bidding exercise on Wednesday (Nov 3). Meanwhile, the COE price for the larger Category B cars more than doubled from S$30,890 to S$82,801 over the same period — the highest since 2014.

Transport engineering consultant Gopinath Menon pointed out that there will always be a segment of the population who want to own cars and are prepared to pay high prices for them.

“They have a variety of reasons such as greater comfort, greater convenience especially for social trips and when they have a young family, public health in times of pandemic and prestige,” he said.