THE economy is slowing down and jobs are in danger, but it seems like this is the best time to buy a car.
Dealers selling smaller models say prices have fallen to record lows on the back of certificate of entitlement (COE) premiums for small cars falling to an unprecedented $2 on Wednesday.
The made-in-China, 800cc Chery QQ now costs $22,999 for the manual model, $5,000 less than originally. And if a buyer goes for this as a weekend car, he need pay only $10,999, down from $12,999.
The smaller models put out by other Chinese carmakers, such as the Hafei Lobo and the Chana Benni, are also going at all-time low prices.
Mr Richard Wan, general manager of TTS Chana Automobile, said prices are at their lowest since the Chana was launched here in May. The 1,300cc manual Chana Benni now goes for $25,999, and its weekend version, for $13,999.
Mid-sized cars are also going at discounts of up to $5,000, offered by retailers who are anticipating that the interest in cars will be fanned anew.
The price tag on a 1,600cc manual Honda Civic is now $67,800, the lowest since its launch three years ago, said MrVincent Ng, product manager at authorised Honda agent Kah Motor. Before COE premiums plunged, it was going at more than $70,000.
At Borneo Motors, which sells Toyota cars here, a 1,600cc automatic Toyota Corolla Altis is retailing at $55,488, about $5,000 cheaper.
It was at an even lower $54,488 on Wednesday, but the price was jacked up by $1,000 yesterday when Borneo Motors received an influx of orders, said its sales manager Sam Koh. Another popular model, the Toyota Vios E Auto, now costs $46,488, also about $5,000 cheaper.
The lower prices, along with news of COE premiums plummeting, have drawn healthy crowds to car showrooms in the last few days. Kah Motor's Mr Ng said: "We're getting what looks like a weekend crowd on weekdays now. It's encouraging, especially after the past few months, when the showrooms were so quiet."
Vertex Automobile and Hafei Automobile (Singapore), which sell Chery and Hafei cars respectively, said they have had up to a third more walk-in customers.
TTS Chana's Mr Wan said he has also had more people putting their names down for the next round of COE bidding.
But while smaller cars are now cheaper, higher-end luxury models like those from Mercedes-Benz and BMW are still as expensive. A check with dealers found little change to price tags, largely because COEs for these larger-capacity cars were not hit by the drop in premiums.
But a spokesman for Cycle and Carriage, which distributes Mercedes-Benz, said one of its rare promotions will be held this weekend as the market is still soft. Cars used for test drives will be on sale. An SLK, for example, will go for $178,000, compared to $196,888 for a new model.
PRICES AT A GLANCE
HOW much some cars cost now, with weekend car prices in brackets:
The combined effects of lower car prices for small cars and falling petrol prices - which were down to their lowest levels in nearly 20 months on Tuesday - are likely to send more potential buyers to car showrooms this weekend. However, one hurdle remains to be crossed - getting a car loan.
Banks and finance houses are tightening access to credit. But dealers like Borneo Motors' Mr Koh remain optimistic.
He said: "Buying sentiments have increased significantly, so while it is now harder to get a loan, I believe the increase in orders will more than offset this."
This article was first published in The Straits Times on Nov 8, 2008.
