The oversubscribed rate for the May 2nd bidding exercise was similar to the previous exercise at about 45% for Category A COEs and increased from 25% to 35% for Category B COEs. Now that there are more news on green shoots signaling that the downturn has bottomed out, the sentiment seems to more optimistic than at the start of the year.
Dealers are now passing the burden of higher COE quota premium back to the buyers by increasing the price. Those with unfulfilled orders are likely to bid aggressively to close the deals since the quota is fixed by LTA while the dealers are fighting to win a bigger slice of the pie - earning less profit is better than having no sale completion.
Prediction on May 27:
Category A: $11,000-12,000
Category B: $10,000-11,000
Verdict on June 3:
Category A: $11,690
Category B: $11,889
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