In Singapore, owning a car is a privilege few can take for granted. Before buying a vehicle, motorists must secure a Certificate of Entitlement (COE) – a permit that has recently cost more than $75,000 and is sold at auctions held twice a month.
Introduced in 1990, the COE system limits the number of vehicles on the city-state’s roads. Each certificate lasts for 10 years, and no car can be registered without one. The cost of the permit is separate from the price of the vehicle itself.
That has made private transport a powerful status symbol in a country of 5.9 million people. A vehicle that might be an ordinary purchase elsewhere can become a major financial commitment in Singapore, where the permit alone can cost more than many cars.
Average COE prices have remained above $74,000, meaning a modest sedan can reach the price of a high-end luxury car in the United States. The policy is designed to control congestion, but it has also changed car ownership from a normal household decision into a marker of wealth.
Insurance agent Andre Lee experienced the consequences after paying $24,000 for a 2010 Kia Forte. The New York Times reported that he later sold the vehicle when fuel, parking and maintenance costs became difficult to justify, despite having a strong income. The car had cost roughly five times what the same model might have fetched on the used market in the US.
Businesswoman Su-Sanne Ching paid $150,000 for a Mercedes-Benz, including $60,000 for the COE. In her case, the expense bought convenience, but the example also illustrates the risks of using high prices to restrict access to road space if suitable alternatives are not available.
Singapore’s system is supported by substantial investment in public transport. About 80% of homes are within a 10-minute walk of a metro station, while many long journeys on the network cost less than $2.00. Rail trips are also described as costing roughly $1.50.
That infrastructure means residents can avoid the COE process altogether and still travel across the city relatively easily. The approach is more than a technology-based mobility scheme: it provides a practical alternative to driving for people who do not own a car.
The model has implications for debates in the United States over congestion, climate policy and access to transport. New York’s introduction of congestion pricing, California’s promotion of electric vehicles, and the growth of Uber and Lyft all reflect the same underlying question.
If driving is deliberately made more expensive, cities must also ensure people have fast, safe and dependable ways to travel without a car. Singapore’s experience shows that pricing and transport capacity need to be developed together.
