Saturday, 11 June 2016

Why I renewed my COE for five years

Last month, the 10-year COE for my Category B car expired. I was faced with four options: buy a new car; renew the COE for 10 years; renew for five years or do without a car.


Guanyu said...

Why I renewed my COE for five years

Vikram Khanna
11 June 2016

Last month, the 10-year COE for my Category B car expired. I was faced with four options: buy a new car; renew the COE for 10 years; renew for five years or do without a car.

Buying a new car was a tempting option. COE prices had fallen from their peak (although they are now rising again). The new models on offer are technologically light years ahead of my decade-old clunker. Some of them come with computer controlled sensors, wide-angle cameras both front and back, driving assistant features that help keep the car within lane markers even at high speeds, "electric eyes" to monitor blind spots, camera-aided parking assistance and touch-screen (and even gesture-controlled) entertainment systems that put my car's humble radio cum CD player to shame.

But in one important aspect, these cars are already obsolete: the car industry has passed a major inflexion point: the transformational technology of the electric car has gone mainstream. Electric vehicles (EVs) are no longer a "maybe in the future" phenomenon. They are already here, and people are buying them.

In terms of performance, EVs beat even the most gizmo-rich internal combustion engine (ICE) cars. They accelerate faster, as torque is immediate. Tesla Motors' high-end Model S gets from zero to 60 mph in just 2.8 silent seconds. The fastest Maserati, the GranTurismo MC, does it in 4.4 seconds, while the fastest BMW, the M6, takes 3.8 seconds.

Last year, the Green Team Formula Race car - an electric car developed at the University of Stuttgart - accelerated from a standing position to 100 kilometres per hour in 1.78 seconds, which makes it faster than any Formula One racing car. EV engines are also more efficient - more than twice as much as those of ICE cars, according to the Land Transport Authority's factsheet on EVs.

Braking is also more efficient; EVs use regenerative braking, which means part of the energy used during braking is recaptured in the battery so it can be used again. Some EVs are even semi-autonomous. The Tesla Model S, for instance, has an auto-pilot feature that enables some amount of self-steering.

But electric cars don't just score on acceleration, efficiency and features. They are also more reliable and cheaper to maintain than ICE cars. They have few moving parts. They don't need oil changes, tune-ups, mufflers, timing belts or catalytic converters. They are also famously greener than ICE cars, especially if charged from a renewable energy source, but even otherwise.

The most expensive component of electric cars is their batteries. Although, thanks to technological improvements, battery costs have fallen by about 30 per cent since 2006 and are likely to fall further. But they are still pricey.

And battery charging is cumbersome. The LTA points out that a standard full charge can take about 8 hours, and enables the car to run up to 160 km, about three times the average daily driving distance of 55 km in Singapore (which means you would have to charge your car overnight every three days on average).

But charging technologies are rapidly evolving. In 2013, Bosch Software Technologies installed the first fast charger for EVs at Changi City Point mall, which can do a full charge in 30-45 minutes. The following year an Israeli company called StoreDot unveiled a new "flash battery" system that can charge an EV in five minutes - about the same time it takes to fill your tank with petrol - and the battery is said to have a range of 480 km. (The same company claims its technology can fully charge a mobile phone in 60 seconds).

Guanyu said...

Charging challenge

But while battery technology has improved, the charging infrastructure in Singapore does not have mass coverage. Although there are close to 100 charging stations across the island, you would have to hunt to find one - and then perhaps wait in a queue. But this too is changing. On May 9, Transport Minister Khaw Boon Wan said in Parliament that the government plans to set up 2,000 EV charging points across Singapore. The ministry has invited proposals for such a rollout, and these are in the final stage of evaluation.

The charging infrastructure is not prohibitively expensive to set up. One can imagine there would be charging points in public carparks, and eventually in public and private housing estates. Once the planned 2,000 charging stations are up and running, you won't have to hunt long for a charging point. You won't have to travel far to get to one either.

EV manufacturers, too, are also working to make battery charging easier and cheaper. For instance, in the US, Tesla offers "supercharger" stations (which can do a full charge in 40 minutes) to all its customers for the life of their cars. Other car companies who want to sell their EVs will find ways to make it easy for customers to charge them.

As for ticket price, electric cars started out prohibitive. But, as with any new product, as the technology improves and economies of scale develop, prices drop. We are seeing that with electric cars just as we saw it with PCs, data storage devices and mobile phones.

The world's best-selling electric car, the Nissan Leaf, is available in Singapore for S$105,000-109,000, including COE (maybe a bit more now, after the recent rise in COEs), according to the website of Stellar Motors, which sells the car. The Leaf has a range of 160 km on a full charge, which costs around S$4. There are even lower priced EVs than the Leaf, such as the Mitsubishi i-Miev and the Chevrolet Spark - although these are not available in Singapore yet.

Late next year, Tesla Motors is also due to launch its Model 3 - a mass market electric car that has a range of around 340 km on a single charge. Priced at US$35,000 in the US, it will be sold in Singapore too, and some motorists here have already placed their orders. EVs in Singapore are eligible for rebates under the Carbon Emissions-Based Vehicle Scheme (CEVS), which was revised in July last year. Under the new scheme, cars registered from July 1 2015 with carbon emissions of less than or equal to 135g per kilometre would qualify for rebates of between S$5,000 and S$30,000, which will be offset against the vehicle's Additional Registration Fee. So government policy is also aimed at making electric cars cheaper.

Options galore

Electric cars aside, there is a growing range of two, three and four-wheel light electric vehicles - which don't need charging stations. These will expand options for getting around.

Then there are car sharing schemes - already available in Singapore - which enable you to rent a vehicle by the hour whenever you need one. Transport Minister Khaw has said that the government is evaluating an electric car-sharing programme under which 1,000 EVs will be on the roads within 10 years. The option of not owning a car at all will become increasingly attractive.

All of these alternatives to petrol cars will come on stream gradually, more and more each year. My bet is that within five years, we will have many options for personal transportation that we don't have today, some of which we might not even be thinking about today. The ICE petrol car will increasingly become a relic, like the video cassette and the vinyl record.

Buying a new ICE car today seems a bit like buying a state-of-the art horse-drawn carriage after the introduction of the Ford Model T at the dawn of the 20th century.

That's why I renewed my COE for five years.