Owning a car in Singapore is extremely expensive. The system aims to reduce traffic and emissions, but makes cars a luxury item. Many therefore rely on the efficient public transport system, while others do not want to give up their own vehicle despite high costs.
Which country is being discussed? Singapore, the small city-state between Malaysia and Indonesia, boasts just over five million inhabitants. There, a car is not just a means of transportation but a symbol of wealth.
As reported by the magazine Xataka, one must pay a hefty price to drive a car there. This is due to the Certificate of Entitlement (COE). A license that costs up to $76,000 before one can even purchase a car. For larger vehicles or SUVs, prices rise to over $106,000. Thus, driving in Singapore is more expensive than ever before.
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Driving as a luxury good, rather than a necessity
Why is driving in Singapore so expensive? The COE system was introduced in 1990 to reduce traffic chaos and pollution. Since Singapore, as a small city-state, has limited space, the government enforces strict regulations on the number of vehicles.
Twice a month, COE licenses are auctioned on platforms. The license must be purchased per vehicle and is valid for 10 years. Prices rise rapidly depending on demand. For many residents, the high costs have become hardly bearable.
This is the alternative to a car: Singapore has one of the best public transport systems in the world. Buses, trains, and ride-sharing services like Grab often make a car unnecessary. A ride rarely costs more than two dollars, just a fraction of the monthly costs of owning a vehicle.
Motorcycles are also an alternative, as their COE is comparatively cheap at around $7,900. While it is a challenge for some residents to do without a car, others see it as the price of a well-organized city.
A system with advantages and disadvantages
What is the downside of the system? While wealthy individuals can easily afford the fees, middle-income families are under pressure. Since the license expires after 10 years and must be re-acquired, many families face the decision: Should they keep their car, scrap it or export it?
As reported by the New York Times, a couple paid $58,000 for a used Hyundai and now has to spend over 10% of their income on maintenance, insurance, and gas.
The advantage for the city: Unlike megacities like Bangkok or Jakarta, where daily traffic jams paralyze transportation, Singapore remains mobile. The strict system ensures free roads, less pollution, and more efficient movement.
Those who can afford it enjoy the freedom of their own four wheels, while for many, public transport remains the better option. A car is like a Rolex, nice to have but not necessarily needed. Luxury does not mean owning a Ferrari or Lamborghini. Instead of driving a super sports car as a status symbol, the car becomes a symbolic possession that conveys wealth.
While in Singapore cars are a symbol of wealth, another example shows that true riches are not always displayed through expensive possessions. Billionaire Bill Gates privately drives an inexpensive electric car that he received as a gift from a musician. Behind the gift lies a form of commitment.
