Stalled Cars in Singapore

Editorial by Strait Times

Published: 25-Dec-2003

THE Land Transport Authority and the National Environment Agency are undoubtedly committed to motorists helping in the 'greening' of Singapore's air - clean though it still is - but they have passed up an opportunity to go beyond symbolism. The agencies this week extended for two years the rebates on 'green' vehicles. This was welcome. But, against widespread expectation, they left the rates unchanged. Was this a case of timidity, or a holding pattern to see how evolving forms of technology in fuel emissions would change the market outlook? Short of a worldwide oil supply crunch which would drive up petrol pump prices sharply, quite how a moderate fiscal concession would stimulate use of environment-friendly cars in Singapore is hard to imagine. Motorists considering buying green cars - those that run on natural gas, electricity and 'hybrids' which combine petrol engines with battery-powered electric motors - have not been seduced by the standing rebate of 5 to 20 per cent of open market value (which can be set off registration and taxes) and the 10-20 per cent rebate on road tax. As has been pointed out again by the Automobile Association of Singapore and the Singapore Environment Council, price is the sole factor that would move car buyers here to go green.

No altruism about salvaging the environment is breathed about. Both agreed that concessions needed to be 'substantial' to change buying habits. And this is after making provision for two negative features of owning green cars - their doubtful resale value and the scarcity of maintenance expertise. As a green car here costs $25,000 to $30,000 more than conventional models ex-rebates, there is not a chance the clean-air drive will make progress. Fewer than 40 are in use after three years of the experiment. While the minute number is consistent with the slow worldwide off-take in the case of gas-run CNG cars (the most reliable estimate puts it at 0.13 per cent of the global vehicular population of 750 million), it is wrong to think that a small market and geographic entity like Singapore can exert no influence on world trends in eco-friendly driving. If operating rebates were generous and green vehicles' import duty much reduced, the resultant spike in sales here could make the world green movement sit up.

It is probable that the LTA had in mind the government review of car-ownership cost in toto, as part of its social-levelling measures, when it said the scale of rebates was 'appropriate'. This would be rational up to a point. But climatic changes and the spewing of pollutants into the atmosphere are immutables which take no account of states' administrative priorities. At some stage, though admittedly some way off, green-car use is going to be dictated less and less by consumer choice and more by transnational pressure. There are signs American motorists may be getting into that groove. The California Air Resources Board's finding that the Toyota Prius is 90 per cent cleaner than the average 2003 model car, and the Honda Civic hybrid 50 per cent cleaner, has reaffirmed interest in eco-friendly ways. From this year's forecast sales of 54,000 hybrid units, sales are projected by the Green Car Journal to rise to 211,000 by 2005, with the release next year of hybrid versions of cars familiar to Singaporeans (Toyota Camry and Honda Accord sedans, Lexus RX 330, Ford Escape and Honda Pilot SUVs). Federal tax breaks and state concessions are a lure, but motorists increasingly say they wish to 'do something' about the air. There is a lesson here.



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