The reality is that we cannot grow the car population in S'pore much further: Jeffrey Siow

A proposed Certificate of Entitlement (COE) scheme to introduce rebates and surcharges on mass-market and luxury cars, respectively, has been supported by the majority of respondents, said Minister for Transport and Second Minister for Finance, Jeffrey Siow, on Nov. 3. Siow, speaking in Parliament, noted that the new "feebate" scheme aims to restore a permanent price distinction in COE premiums. The questions asked by Members of Parliament (MPs) concerned the proposed changes, such as whether prices for mass-market cars would remain within reach, and whether it would influence electric vehicle (EV) adoption. The scheme proposed by Holland-Bukit Timah MP Edward Chia uses rebates and surcharges where a lower-value car receives a rebate on its COE price while a higher-value car gets a surcharge. "Feebate" with five bands to reduce cliff effects preferred Siow said that LTA concluded public consultation on COE categorisation on Nov. 2 and is studying the submissions and has not decided on the outcomes. He added that "Most people preferred a 'feebate' with five bands, to reduce cliff effects." LTA proposed either a three-band or five-band system. The biggest rebate and surcharge are S$15,000 in both systems. Depending on the structuring of the bands, the difference could be as large as S$30,000. This comes as the gap between Category A and B COE premiums has diminished with the growing popularity of EVs. EV power outputs can be adjusted using software by manufacturers and workshops, allowing the same car to qualify for different COE categories, stated Siow. Hence, Category A premiums for smaller and less powerful car models exceeded Category B premiums for larger cars multiple times in 2026. Existing Category A and B COEs will be merged into a single category for cars under LTA's proposal. EV adoption support to remain separate and govt studying transport grant option MP for Chua Chu Kang, Choo Pei Ling, asked how the government would prevent the system from disincentivising the adoption of high-performance EVs, which often carry a higher Open Market Value (OMV) and ensure that mass-market car buyers are not financially crowded out by luxury car buyers. Siow responded, saying that a separate "feebate" structure for EVs was proposed but would make the system too complicated. EV adoption will be supported through the Vehicle Emissions Scheme rather than through COE policies, added Siow. MP for Marine Parade-Braddell Heights Tin Pei Ling questioned if the proposed "feebate" scheme in the latest LTA public consultation on proposed changes to the COE system will drive up demand for lower-valued vehicles and bolster the prices of mass market cars. Tin also asked about support for large Singaporean families with car needs. Siow said he acknowledged that larger families with young children may find it difficult to travel together on public transport, but any support would also have to consider families that choose not to buy a car. The government is studying a transport grant option, with more details to be given later. LTA to finish review by end-2026 Siow said: "The reality is that we cannot even grow the car population much further." Siow stated that there are 660,000 passenger cars today and roads occupy more than 12 per cent of Singapore's total land area. LTA expects to finish its review by the end of 2026 and reveal its findings and recommendations in the first half of 2027.