TELEPHONES were ringing off the hook at car showrooms and potential buyers turned up in droves in the hopes of getting a small car at bargain prices.
The trigger behind this interest in cars under 1,600cc: Wednesday's historic $2 low for the certificate of entitlement (COE) for small cars.
Some who turned up, unfamiliar with the mechanics of bidding for COEs, were disappointed to find out that only the 1,851 buyers who placed their bids for cars under 1,600cc in the last round had snagged their COEs for $2.
Those who want to buy cars from now will join the next round of bidding, the results of which will be out in two weeks.
The majority of these potential buyers were, however, sniffing out cheaper car packages.
Indeed, Toyota, Honda and Hyundai dealers all say they have slashed prices: Borneo Motors has cut prices for small Toyota cars like Yaris, Vios E and the Altis 1.6 by between $5,000 and $6,000; Kah Motors has brought down the prices for the Honda Jazz and Honda City by up to $5,500.
One of the lucky 1,851 who got his COE at the rock-bottom price was mechanical engineer Aung Zaw Myint, 40. He started shopping for a car last month when his company assigned him a project which required him to travel to Tuas daily.
When he signed on the dotted line for his 1.6 litre Toyota Altis, it was for a set of wheels costing $59,500, including $10,000 for the COE. With the COE price crash, he is getting $9,998 back, with the pleasure of knowing that his car now costs $49,502.
He said: "I am very happy because now I get to save about $10,000."
As a first-time buyer, he had two other things going for him: He does not have to sell off an older car in the now-collapsed second-hand car market, and it was a cinch getting a car loan since he had no existing loan.
Motor Image Enterprises group chief executive Glenn Tan said banks are now a lot more selective in granting loans. Nearly a third of those who went to his showroom eyeing a Subaru were rejected for loans recently, he said.
Businessman Mohamed Kamarudeen, 63, who wanted to buy a car about six months ago, held back because COEs cost around $16,000 then.
He has missed the $2 COE, but still thinks it is a good time to get a Honda City or Toyota Vios after trading in his second-hand Hyundai Accent.
There are a few unhappy campers among those who got their COEs for $2. Shipping executive Jun Tan, 43, for instance, signed on with a parallel importer to buy a Toyota Axio for $63,000, and got a verbal promise that she would get a rebate if COE prices fell below $10,000.
But the staff at the showroom have denied making this promise, so she has gone to the Consumers Association of Singapore.
Singapore Vehicle Traders Association president Neo Nam Heng said the association would mediate if it received complaints. So far, it has not received any.
This article was first published in The Straits Times on Nov 21, 2008.
