Car dealers expect COE prices to rise in response to revised rebates

They say some buyers are likely to rush in to get the higher incentives before Jan 1

- Lee Nian Tjoe

The reduction in rebates for electric vehicles (EVs) from January 2026 is expected to nudge some buyers to purchase cars before that deadline, which in turn would drive up certificate of entitlement (COE) premiums, said motor dealers.

On Sept 8, the Land Transport Authority (LTA) and National Environment Agency announced that the combined rebates for the EV Early Adoption Incentive (EEAI) and Vehicular Emissions Scheme (VES) will be reduced from $40,000 now to $30,000 in 2026.

From Jan 1, 2026, petrol hybrid cars will also no longer get the $2,500 rebates under the VES, which is meant to encourage drivers to switch to cleaner-energy vehicles.

Both the EEAI and VES were previously due to expire on Dec 31, 2025. The schemes provide rebates when a new car is registered to help offset the upfront cost.

In a joint statement, the authorities said: "We expect a short-term increase in COE prices. Potential car buyers are strongly encouraged to be prudent in bidding on COEs."