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Off-Peak Cars. What are they? And should you get one?



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An increasing number of motorists are registering for new off-peak cars (OPCs), even though the overall number of OPCs on Singapore roads has decreased.

If you want to know what an OPC is, or are considering getting one, the trusty Car team at Budget Direct Insurance is here to help.

The facts

According to the Singapore Land Transport Authority (LTA) there were 22,562 off-peak cars on the roads in 2016 - the lowest number for 11 years.

But the number of new registrations for off-peak cars is increasing. In 2016 there were 203 new registrations, which amounts to about 17 a month. This is up considerably from 2013 when there were around 11 every month.

So why the sudden upsurge in motorists registering for new OPCs and should you consider getting one?

What is an off-peak car?

Off-peak cars, or red plates, were introduced in 1994 to help cut the rising costs of motoring and to make it more affordable to own a car. It also meant easing traffic congestion during peak hours. Cars under the scheme can’t be driven from 7am to 7pm weekdays, among other restrictions. If you want to drive outside restricted hours then you have to buy a day pass or E Day Licence at $20.

What are the advantages of an OPC?

  • If you register your new car under the OPC scheme you get a rebate of $17,000. You also get a $500 discount on annual road tax.
  • If you convert your normal car to off-peak the rebates are a little different.  You receive a cash rebate of $1,100 every six months together with the usual $500 flat discount on annual tax.

Are these incentives tempting enough?

  • The scheme certainly becomes more attractive when Certificate of Entitlement (COE) prices are factored in. When COE prices are low the $17,000 rebate starts to look more viable. The rebate then really helps to offset the cost of your COE and registration fees when buying a new car.
  • Back in 2014 when COE prices were more than $70,000 you would still have to fork out more than $100K for a car you couldn’t use regularly! But as COE prices continue to drop, OPC cars definitely become a more appealing option.
  • Latest COE prices for small cars in Category A stand at around $36,001, which means you’ll be forking out less than $20K for your COE, taking into account the rebate. This is the lowest CEO we’ve had in the last seven years and is certainly a major reason for the increase in new motorists registering for OPCs.

What else should you factor in?

Aside from the cost, you can also factor in the practical aspect of how you use your car. For instance, you’ve decided you don’t want to drive to work because of the congestion and you can get to your workplace faster on the MRT or bus. All valid points given there is heavier traffic on the roads and an increasing number of MRT stations springing up.

You might also want to avoid ERP charges and high parking fees. Your main usage might also be, for instance, ferrying the kids around on weekends.

Given the falling costs of COE and our improved public transport options, it’s not surprising that more motorists are taking up the OPC option. There is also a growing trend of second-hand car buyers who are converting normal cars to off-peak to enjoy the rebate and discount and to cut down on motoring costs.

All things considered, if you’ve been sitting on the fence when it comes to getting an off-peak car, then now might be as good a time as any…

For more answers to your insurance questions, - PLUS motoring analysis, news and tips, look out for regular posts in this series.

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