Car buyers take note: There will be fewer certificates of entitlement (COEs) available this year.

Releasing details on the number of COEs for this quota year, from May 2007 to April 2008, the Land Transport Authority (LTA) said 127,021 will be given out this year, against the 139,647 COEs for the same period last year.

LTA spokesperson, Ms Naleeza Ebrahim, said the annual COE quota is calculated based on "the vehicle growth component, the expected de-registrations of vehicles in the year, and the adjustment component for any over or under-projection of vehicle de-registrations in earlier years."

Despite the smaller COE quota, Singapore's vehicle population looks set to grow by 3 per cent or approximately 23,000 vehicles, according to LTA's forecast of 86,000 vehicles to be deregistered for QY07. The total number of vehicles as at 31 December 2006, stands at 778,257.

An additional 8,520 COEs had been added to the last year's quota during a mid-quota year review, meaning that the original number set at the start of QY06 was 131,127, which is still higher than this year's quota.

Miss Ebrahim explained to AsiaOne Motoring that the lower number of COEs for QY07 compared to that originally announced for QY06 was "due mainly to a lower number of adjustment COEs introduced for QY07".

The largest drop in number of COEs was for the popular Category A cars (1600cc and below) and taxis. 51,803 Cat A COEs will be available over the course of the next Quota Year, almost 7,000 fewer than the previous year.

Motor traders say although the quota of COEs for this year is smaller, it is among the most generous since the COE system started in 1990. So while premiums are likely to rise, they are not expected to shoot up.

In announcing the new quota in Parliament, Transport Minister Raymond Lim warned that the future could see a slower rise in the proportion of new cars each year.

The current 3 per cent cap on the annual rate of vehicle growth is not sustainable and will be reviewed next year, he said during the debate on his ministry's budget.

"If we continue to allow 4 per cent annual growth, our current vehicle proportion of 800,000 would increase by about 50 per cent to about 1.2 million by 2020," he warned.

By then, the expected expansion in road capacity is about 9 to 12 per cent.

To illustrate how the city would be chocked with traffic, he said: "If you were to line up all the 1.2 million vehicles bumper to bumper, all our existing expressways would be filled up to five times over."

Apart from moderating vehicle growth, the govenrment will also "continually review" the electronic road pricing, he said.