Blog / Motorcycle Insurance
High cost of motorcycling in Singapore. What to do? Read on.
Let’s face it; motorcyclists in Singapore have had a relatively affordable ride until recently. So what’s changed? And what can motorcyclists do about it?
Additional Registration Fee (ARF)
From February 2017 the Additional Registration Fee (ARF) on new motorcycles changed from a flat rate of 15% to a tiered arrangement – now 15% on the first $5,000 of Open Market Value, 50% between $5,000 and $10,000, and 100% above $10,000.
The changes were apparently made in order to keep mainstream commuter motorcycles more affordable in the face of rising COE quota premiums, which have been on a tear.
COE quota premiums
January 2014 appears to be the turning point in COE values. The premium was pretty reliably under $2,000 until then, but it climbed steadily to a peak of $8,081 in March 2017. Accusations of manipulation of COE values by some dealers have been made, though there is little doubt that the relative decrease in COE availability over the years plays a large part in the rising premiums – between 2007 and 2017 the motorcycle fleet in Singapore has declined in number by 1.5%, while over the same period the car fleet has increased by 19%. Accuse motorcyclists of being paranoid about official antipathy to their cause, or let the figures do the talking.
High quota premiums disadvantaged purchasers of smaller-capacity motorcycles, as a larger portion of their overall purchase price was going to pay for the COE – in other words, buyers of larger capacity machines were paying more, but they were also (relatively) getting more for their money.
With prices of some high-end motorcycles now exceeding that of a decent car – the Ducati 1299 Superleggera is probably the most expensive bike currently available, with a list price of $250,000 on the road – you could expect buyer behavior to change.
Then again, if price-sensitivity was the defining factor in the Singapore motoring market, you’d see a lot fewer Mercedes-Benz models on the roads. Chances are that Ducati is still selling $250k motorcycles. And those COE premiums have hardly tumbled since the new tax regime was introduced – that peak COE premium came after the introduction of the new taxes after all.
That’s not to say that motorcycle buyers looking for value haven’t adjusted their expectations. Yamaha’s sales increased 24% in 2017 compared with 2016 according to LTA figures, for instance, while BMW sales dropped 39%. Then again, Harley-Davidson managed to increase sales by about 17%, so not all high-end manufacturers were so badly affected.
What to do?
Short of a campaign to discourage people from buying motorcycles and waiting for COEs to drop, or a miracle in the form of higher quotas (yes, I’m a comedian), living with the new price regime is something Singapore riders are stuck with.
Lower your expectations
Obviously, lowered expectations are the order of the day, but that’s not entirely a bad thing: While 200hp superbikes are an absolute blast to ride, there are very few riders who have the capabilities to ride them anywhere near their limits. Quite often the top-end machines have smaller-capacity siblings that are still wickedly fast, and less daunting for riders of average abilities (not that we like to admit that, of course). Plus, the almost inevitable speeding fines for super-fast machines can add up: Some superbikes are able to break the speed limit in first gear.
Downsizing could save thousands on the purchase price, and smaller capacity and lighter machines are much less expensive to run, particularly when it comes to tyres. Think about what you’re really using the bike for, and shop accordingly. My last bike was nearly 30hp less than the one that preceded it and I got masses more enjoyment out of it, and paid less to keep it on the road. Win/win!
At the lower end of the market there are fewer opportunities to save, though bikes with less fairing coverage may be cheaper to purchase, and less likely to sustain damage in case of a tumble, for instance. And while larger-capacity machines are always tempting, there is still a lot of enjoyment that can be had riding the popular Class 2B machines – do you really need that upgrade?
There’s no point at all trying to save money on vital components like tyres – good quality tyres can be the difference between life and death after all. Likewise protective riding gear, though you could save a bit by eschewing the fancy racer-replica helmet – the exact same model in plain colours offers the same protection for a significant discount.
Save on insurance
You can save on an ongoing basis by signing up for more affordable insurance. Make big savngs when you go direct and cut out the middleman. Budget Direct Insurance, for instance, offers motorcycle premiums from as low as $150.
Want more ways to save on motorcycling in Singapore? Check out the article End of the free ride.