Sales of Rolls-Royces which is a premium luxury car has trebled from 10 to 37 units, closely followed by Ferrari, which doubled its sales volume from 32 to 64 units this recent months. At the other end of the market, Proton sales fell by almost 40 per cent from 413 to 256 units, while Chery sales fell tremendously by more than half from 309 to 139 units. The story was similar among the German luxury makers such as BMW increased sales by almost 20 per cent from 3,926 to 4,708 units, neck-and-neck with Mercedes-Benz, which increased sales by 18per cent from 3,997 to 4,705 units. By contrast, the sales of traditional market leader Toyota slumped by over 60per cent from 17,555 ...view middle of the document...
If car buyers are relatively price insensitive, then dealers can pass on more of the COE to buyers, hence many buyers in Singapore are more willing to spend more on luxury cars as they can afford easily. Buyers of BMW and Mercedes cars are probably less sensitive to price than buyers of Toyotas and Hondas. Furthermore BMW and Mercedes distributors make larger profit margins, and so can more easily bear part of the COE price than distributors of Toyota and Honda cars can. Thus, both on the demand and supply sides, there is more willingness to pay for the COE among the premium European brands than in the mass-market Japanese brands. So sales of BMWs and Mercedes are holding up and indeed growing while sales of Toyotas and Hondas are withering consistently.
The decrease in market sales of mass-market Japanese brand cars have therefore drove the average families away as they do not possess the purchasing power to buy a luxury car, this attracts those wealthy and rich car buyers as they are not affected by the slight % increase of the COE. In which the demand for china & japan manufactured cars have dropped drastically. With the increase in COE it shows that Singapore’s economy is doing well with wage increment, new models arriving and more people bidding. In Germany the sales of BMW’s new series have been increasing due to the popularity , with the increase of COE prices in Singapore the Germany brand BMW has not been affected in any major ways as the demand for European luxury cars are much higher than japan market brands, giving a sales advantage to German car brands