Singapore is a heavily urbanised and highly populated but small island-city state, making it one of the most expensive countries in the world to own a vehicle. For businesses, this expense only gets greater as a fleet of commercial vehicles is usually required for operations to run smoothly, compounding this cost greatly.
So whether you’re a business owner, manufacturer, or delivery service provider, you should make sure that you at least have a general understanding of the COE and what it means for your operational costs.
What is a Certificate of Entitlement (COE)?
In Singapore, it is necessary to obtain a COE in order to register for a vehicle, be it private or commercial, for a period of up to 10 years, giving you the right to own and operate it.
If your commercial vehicle is still in good condition at the end of its first 10 years, you may either decide to renew your COE for another 5 years or 10 years or invest in a brand new commercial vehicle. Some companies may choose to renew while others may opt to purchase brand new vehicles, depending on the circumstances, for instance, if the prevailing price is attractive.
COEs are divided into various categories depending on the type and engine capacity of a vehicle. As there are only a limited number of COEs available at any point in time, the price is dependent on market demand. Higher demand will result in a surge in prices. Buyers have to bid for COEs in the appropriate categories depending on what type of vehicle they wish to purchase. Thus, not everyone who wants a COE is guaranteed to get one.
Latest Update on Certificate of Entitlement (COE) Prices for Commercial Vehicles
Due to the coronavirus pandemic which resulted in Singapore’s economy taking a hit, the latest updates in 2020 reflect a fall in COE prices for all vehicle types except motorcycles.
The COE quota premium for commercial vehicles has experienced a sharp decline since the onset of the virus from as high as $25,001 in early January to $22,002 in March. However, this does not necessarily mean that businesses should immediately start bidding for a commercial vehicle–here’s why.
Should I Purchase or Lease a Commercial Vehicle?
Due to the recent drop in COE prices for commercial vehicles, some businesses may be considering a purchase. However, with the impact of the COVID-19 pandemic on the global economy, market conditions in the near future are uncertain. Thus, purchasing a commercial vehicle may not be the wisest decision as it ties you down to a hefty financial commitment of a minimum of 10 years ownership.
The cost-effective alternative to purchasing commercial vehicles for your business would be leasing, which allows you access to a commercial vehicle with the following benefits:
Leasing a commercial vehicle allows you to avoid having to pay a hefty downpayment that comes with a purchase. The low upfront cost of leasing a commercial vehicle allows businesses to free up capital for other areas of business priority. Here at ETHOZ, we provide a commercial vehicle leasing package that will cover all maintenance expenditures and bear the expenses of asset depreciation and potential vehicle disposal loss, helping you save on extra expenses.
Commercial vehicle rental also gives you much more operational flexibility. Unlike a purchase, a leasing arrangement does not tie you down to one commercial vehicle. You have the option to renew, upgrade, or upsize your fleet according to your business needs. Furthermore, ETHOZ not only conducts regular maintenance for all its commercial vehicles to ensure smooth operations but fleet management too, freeing up your manpower for labour efficiency.
In addition to the financial and operational benefits stated above, our commercial vehicle leasing package also includes the following:
- Motor Insurance
- Road Tax
- LTA Inspection
- Unlimited Mileage
- 24-hour breakdown support
- Maintenance & Servicing
- Replacement Vehicle
Leasing of Commercial Vehicles
Commercial vehicle rentals are becoming an increasingly popular option for small businesses and a wide spectrum of MNCs and SMEs from different industries. Our commercial vehicle offering includes van, truck and lorry rental. We are also able to tailor vehicle customisations and configurations to the needs of your business.
If you are looking lease a commercial vehicle in Singapore, our professional relationship managers at ETHOZ will work closely with you to help you decide on what would best meet your business needs. To find out more about the benefits of commercial vehicle leasing, simply give our team at ETHOZ a call at 66547773 or drop us an email at email@example.com today!