This section is meant to provide an easy to understand summary of the local automotive industry from a retail perspective. The information is categorised for new and pre-owned/used cars.

New Cars
There are 2 broad channels through which new cars are sold in Singapore:

Manufacturer Manufacturers
Importers Exporters / Overseas Dealers
Distributors Importers
Retailers Retailers
Authorised Agents  

(note: this excludes those who import their own cars)There are inherent differences between these 2 channels:

Warranty program Supported strongly by the manufacturer. Warranties usually given by the retailer, however, some manufacturers have warranties that are binding regardless of which channel the car is sold through.
Product recalls In the event of a product recall, the authorised channels are the first to know and are obligated to try and contact owners of affected vehicles sold by them for rectification. While possible, it is highly unlikely that the grey importers have well-tuned recall programs.
Stock levels The authorised dealers usually have healthy stock levels and offer pretty decent delivery times. Grey importers usually carry limited stock but can be resourceful in obtaining the vehicle you desire when you whip out your cheque book.
Flexibility in options Many authorised dealers are too caught up in their bread and butter of selling cars to try and customise a car for you. This usually applies for the more affordable cars. These dealers are often prepared to order what you want provided you are prepared to wait.
After-sales support The authorised channels have manufacturer trained technicians, official diagnostic equipment and regular product training programs. Many grey dealers outsource their after-sales function so it is best to check out what they offer from an after-sales perspective.
Vehicle variety The authorised channels usually bring in a fix variety of models and variants. The grey channels have no restrictions on the variants they can import other than the guidelines imposed by the authorities from a compliance perspective (eg, emissions, safety, etc.)
Resaleability Compared with parallel imported vehicles of the same model and specifications, those sold via the authorised channel tend to fetch a slight premium in resale value compared with the parallel imported one. However, some grey imports have higher specifications and options that can improve their resale value.

Whether the official or grey channel is a better channel depends on an individual buyer’s needs. At the end of the day, the age-old adage Caveat Emptor (let the buyer beware!) applies regardless of the chosen channel.

For a list of authorised car retailers, one can always refer to the AA’s magazine “Highway” or their website at In addition, one can refer to the Singapore Motor Traders Association website at for more information. 

Pre-owned (Used) Cars
Buying a pre-owned car in Singapore can be a daunting experience. The segment is highly fragmented with many small players and a handful of larger players. While there are a couple of decent used car dealers who offer a reasonable service, these are few and far between. As in most other markets, the uninitiated enter a deal with a high degree of uncertainty.

The perils of buying a pre-owned car in Singapore are similar to those in other countries with certain added complexities. These include factors that are peculiar to the Singapore market due to either regulatory or cultural influences. A good example would be the “paper value” concept whereby most cars have a certain value which is “backed” by the authorities. This greatly impacts the value of the vehicle, in some cases, even more than the condition of the car itself.

We view the used car segment having 4 main product categories:

“Nearly new” We draw the cut-off age for this category at 3 years or earlier depending on when the vehicle’s warranty expires. (Note: some brands of vehicles do offer a five year warranty from date of registration). • The first owner has taken the brunt of the depreciation.
• The vehicles generally have a warranty.
• These vehicles are generally in good condition.
• With recent changes in regulations, determining the base value of the car is critical for this category. (see changes in PARF rebates below).
“Not-so new” In general, vehicles older than 3 years but younger than 8 years fall into this category. Due to the recent (between 2001 and 2004) high numbers of vehicles being deregistered in Singapore, there are not that many vehicles on the road that fall into this category. • The vehicles in this category tend to have a higher paper value but this is a big generalisation. It is best to check the vehicle’s papers to determine the actual paper value. • Usually the warranty has expired and the condition of the car may be a little more suspect especially if a full service history is not available.
“Old” but less than 10 years old These cars are generally between 8 and 10 years old and will need to have their COEs renewed at the 10th year if you wish to continue using the car. • These vehicles tend to have very low depreciation because of their high paper values.
• The financial risk of owning one of these cars is limited because of the short remaining lifespan and the predictable rebate amounts.
• Here, maintenance costs might become an issue due to the age of the car. However, if the vehicle is properly evaluated, this risk can be mitigated to some degree.
“COE” cars (more than 10 years old) Cars here have had their COEs renewed and can be kept on the road until the current COE expires. Note, most of these cars have had their COEs renewed for 10 years but some for only 5. Those in the later group cannot have their COEs renewed again once the 5 years are up. • These vehicles are the most affordable generally because they have no PARF rebate.
• Low capital outlay is required and therefore, the amount in value that can be lost is limited.
• Maintenance issues and their corresponding costs become more important.
• Increased road taxes (increasing by 10% per year for 5 years until the 15th year for a maximum of a 50% surcharge).
• Low paper/rebate levels.

For anyone who is considering buying a pre-owned car in Singapore, we strongly recommend that you get the vehicle evaluated by a professional evaluator like the AA. It is important to note that when vehicles are advertised, many dealers use words like “STA or VICOM certified/evaluated”. These evaluations are roadworthiness checks (like the MOT in the UK) and do not constitute a thorough vehicle evaluation. 

Changes in PARF rebate scheme
The value of a pre-owned car in Singapore contains a unique element called the “paper value”. This value is a function of the value of the un-used portion of the COE and something called the PARF rebate. The PARF rebate is essentially based on the OMV (Open Market Value) of the car and there have been some changes in recent years to the rebate amounts. To date, there are 2 cut-off dates for these changes and it is imperative that one checks the registration card of a pre-owned vehicle for confirmation of the relevant details.

This table (extracted from provides a summary on the PARF rebate levels depending on the cut-off dates:

(For cars registered with COEs obtained before May 2002 tender)
(for cars registered with COEs obtained from May 2002 tender)
Not exceeding 5
130% of OMV
75% of ARF paid
Above 5 but
not exceeding 6
120% of OMV
70% of ARF paid
Above 6 but
not exceeding 7

110% of OMV

65% of ARF paid
Above 7 but
not exceeding 8
100% of OMV
60% of ARF paid
Above 8 but
not exceeding 9
90% of OMV
55% of ARF paid
Above 9 but
not exceeding 10
80% of OMV
50% of ARF paid
Above 10
0% of OMV
0% of ARF paid

From the table, there appears to be only one cut-off date. However, there is another cut-off date which is April 2004. If you look at the table carefully, the column which says “Graduated PARF rebate” details PARF rebates based on the OMV (Open Market Value or import value) of the car. The next column details rebates based on a percentage of the ARF (Additional Registration Fee) paid. In April 2004, the ARF payable for new cars dropped from 130% to 110% so taking a car being deregistered at the 10th year, the PARF rebate would have changed from 50% of 130% (or 65%) to 50% of 110% (or 55%) of OMV. Future changes may apply.