Dr Khor was responding to a question from MP Louis Chua (WP-Sengkang), who asked if car rental companies, especially those renting from PHC companies, had affected the prices of COE offers over the past year .
The COE premium for larger Category B cars hit a second straight record in the latest bidding exercise on September 7, with prices closing higher for most categories.
COE premiums have been on a broad upward trend and have broken records in recent months, with observers blaming this on a lack of COE supply.
Some netizens blamed the exorbitant prices on PHCs and rental companies, arguing that they should be removed from the COE’s bidding process, like taxi operators. PHC and the rental companies earlier told CNA that they did not make aggressive offers for COEs and were not responsible for the increased premiums.
Dr Khor said on Tuesday that “there is no evidence” that the PHC companies caused the COE bid prices to rise.
“LTA (Land Transport Authority) has been watching the market closely and over the past year. The demand for COE from PHC companies as well as the overall PHC population has remained steady,” she said.
Since 2012, taxi operators do not have to bid for a COE to register their taxis. Instead, they draw from the Category E (open) COE pool and pay the applicable quota premium for Category A COEs.
Taxi availability standards have also been introduced, and taxi operators can increase their fleet by up to 2% per year, subject to meeting the standards, Dr Khor said.
“Unlike taxis, PHCs are essentially private cars that have the flexibility and range to pick up passengers, increasing our offering of point-to-point shared vehicles,” she added.
“Therefore, PHCs are treated as private cars under the vehicle quota system.”
Dr Khor said the call to review COE categories is a “standing suggestion”, stressing that there will be trade-offs between having specific categories to meet specific requirements and ensuring sufficient COE quota for those. categories.
“The point is, it’s going to lead to further fragmentation and volatility, especially when COE supply is low,” she said.
“So if you look at COE bonuses and so on, it’s basically the demand and supply of vehicles that drives COE bonuses.”
Dr. Khor added that LTA will continue to monitor the point-to-point sector and study the programs for further improvements.