Cat A COE May 2026 Hits $124,790: What’s Driving the Climb?

Cat A COE premiums closed the May 2026/1 bidding exercise at $124,790, up 1.4% from the previous exercise and 21.1% higher than the same period a year ago. That year-on-year figure is the one worth sitting with. A single exercise can move on thin volume or a cluster of fleet bids. A 21% climb sustained across twelve months points to something more structural in the small-car segment.

This post looks at what the quota numbers and bidding patterns could suggest about where Cat A demand is sitting right now, and what buyers in this segment might reasonably expect over the coming months.

The Quota Picture

LTA releases Cat A quotas each bidding exercise, and the supply side has been tighter than many buyers realise. Cat A covers cars with engines up to 1,600cc and 97kW (130bhp), a bracket that captures most mass-market Japanese and Korean models. When quota supply falls even modestly, premiums tend to respond quickly because demand in this segment is relatively inelastic. Buyers here are often replacing a car out of necessity rather than upgrading opportunistically.

The May 2026/1 exercise quota has not expanded materially compared to the same period in 2025. One read of this is that LTA’s deregistration-linked quota formula is simply reflecting fewer older cars coming off the road, which feeds back into lower fresh quota. If that pattern holds through the second half of 2026, the supply constraint is unlikely to ease on its own.

You can track each exercise’s quota and result on the TRW COE results page, which is updated after every bidding round.

Why the Year-on-Year Jump Looks Different From the Monthly Tick

A 1.4% month-on-month rise sounds modest. The $124,790 figure is roughly $1,700 above the previous exercise, which could reflect a single large fleet renewal or a small shift in individual buyer confidence. On its own, that number does not tell you much.

The 21.1% year-on-year comparison is harder to explain away. In May 2025/1, Cat A premiums were sitting closer to $103,000. The climb since then has not been a straight line, but the direction has been consistent. A few factors could be contributing. Parallel importers have been more active in the Cat A space as they work around Cat B quota constraints, which may be adding bid pressure from a segment that was historically lighter in this category. Mainstream dealerships have also been managing tighter allocation from manufacturers, which might be pushing some buyers to bid more aggressively rather than wait for stock.

None of these explanations is definitive. The bidding data LTA publishes shows final premiums and quota numbers, not the composition of who is bidding. The patterns above are inferences, not confirmed causes.

How Cat A Compares to the Broader COE Market

Cat B (cars above 1,600cc or 97kW) has been running at a significant premium over Cat A in absolute terms, as it typically does. What has shifted is the gap. Cat A premiums have been closing the distance relative to Cat B over the past year, which is unusual. Historically, the spread between the two categories gives buyers a rough sense of how much the market values engine size and power. A narrowing spread could suggest Cat A demand is outpacing Cat B demand in relative terms, or that Cat B supply has loosened slightly while Cat A supply has not.

Cat E (open category) remains the ceiling and continues to attract buyers who cannot secure a Cat A or Cat B premium at a price they are willing to pay. Some Cat A-eligible car buyers do use Cat E as a fallback, which adds another layer of demand pressure to the open category without directly showing up in Cat A bid counts.

What This Means for Buyers Considering a Cat A Car Now

If you are in the market for a Cat A car and your current vehicle’s COE is expiring in the next six to twelve months, the $124,790 premium is the number you are working with today. Whether it moves materially before your renewal window closes is genuinely difficult to call. The supply side does not suggest a sudden easing, and the year-on-year trend has not shown signs of reversing.

A few practical considerations worth thinking through. First, the premium is paid upfront and is not recoverable if you sell the car before the COE expires, so the effective cost per year of ownership rises if you plan to hold for a shorter period. Second, if your existing car is Cat A eligible for a COE renewal (Parf rebate still intact, car under ten years old), the renewal route locks in the current premium without the uncertainty of a future bid. Third, buyers who are flexible on model can sometimes find dealers with stock already attached to a COE bid, which removes the bidding risk but may limit choice.

For anyone weighing up whether to renew an existing COE or take a fresh one, the workshop services page covers what TRW can check on your current car to help you make that call with a clearer picture of its mechanical condition.

What the Next Few Exercises Could Look Like

LTA typically announces quota allocations quarterly, and the next adjustment window could shift the Cat A supply picture. If deregistration volumes pick up in the second half of 2026, quota could expand modestly, which might soften premiums. If they stay flat or decline, the current premium range could persist or edge higher.

There is also the question of whether the parallel import market stays as active in Cat A as it has been. PI dealers tend to be price-sensitive bidders, and if premiums climb to a point where the margin on smaller cars compresses, some of that demand could pull back. That would be a softening factor, though it is speculative at this stage.

One read of the current situation is that $124,790 reflects a market where supply is constrained and buyers in the small-car segment have limited alternatives. Whether that changes meaningfully before the end of 2026 depends on factors that are not fully visible in the bidding data alone.

TRW will continue tracking each Cat A result as exercises close. The COE results page carries the full history if you want to map the trend yourself.

Thinking about renewing your COE or buying a used Cat A car? A pre-purchase or pre-renewal inspection at The Right Workshop can give you a clear mechanical read before you commit. Book with us at Autobay @ Kaki Bukit, Singapore #02-61.