Reason for Consistently Higher Number of Expired Category D (Motorcycle) COEs

Mr Sitoh Yih Pin asked the Minister for Transport (a) whether LTA is aware of any reason for the consistently higher number of expired Category D (Motorcycles) COEs; (b) if so, what are the reasons; and (c) whether LTA has any concerns that this could be the result of an attempt at market speculation of Category D (Motorcycles) COEs.

The practice in the motorcycle trade is for the dealers to bid for Category D Certificates of Entitlement (COEs) under their names and to hold a stock of Temporary COEs (TCOEs). This allows their buyers to take delivery of the motorcycles immediately. This is the business model that our motorcycle dealers have adopted. This is unlike the motor car trade where the dealers only bid for TCOEs upon confirmation of demand.

Under the current motorcycle business model, the dealers take some risk that they may not be able to use up all the TCOEs at the end of the six-month validity period. Over the past three years, Category D TCOEs which expired at the end of the validity period made up about 3%. There is no evidence of market speculation at play.