With a number of anticipated car releases happening in 2018 and a growing market for luxury cars in Singapore, purchasing a luxury automobile can seem like an exciting opportunity. As luxury auto dealers are fueling the demand by making their models more affordable, cars that used to seem out of reach now have a better chance of reaching a greater demographic. However, buying and owning a car is still incredibly expensive in Singapore, as it again ranked as the most expensive city in the world mostly due to high automobile prices. Here, we have compiled a list of some cost-saving tips and tricks to make your dream of purchasing an Audi or BMW a step closer to reality.
Take advantage of the used luxury car market
Whether used or new cars are cheaper in Singapore is an ongoing debate. However, in most cases, buying a gently used luxury car may save you thousands of dollars over time. Additionally, Singapore has unique used car dealers such as the vending machine-esque AuthoBahn Motors, which offers an array of luxury vehicles for sale including Bentley, Mercedes, Porsche and BMW. For example, a 2016 Mercedes AMG has a list price of S$500,000 compared to almost S$700,000 if you were to buy the 2018 version, while having a very similar design, same engine capacity and power. Even on an annual cost basis, the 2016 model costs about S$7,500 less per year than the newest model.
Your car dealer won't necessarily give you the best car loan and insurance rates
All around the world, car dealerships are known to sell expensive insurance plans and loans to increase their profit on their car sales. To make sure you aren't shelling out thousands of dollars on higher insurance premiums and loan repayments, you should make sure to look for other options online. This tactic is especially impactful for luxury cars, whose high price tags often lead to very high level of insurance premiums and even higher amounts of car loan.Some insurers even offer cheaper upgrades to any workshop plans and others offer a variety of high-end benefits including car accessory coverage, flexibility with LTA approved mods and servicing guarantees. Better yet, other insurers offer very competitive premiums for luxury vehicles, even when compared to premiums for mid-priced sedans. In fact, finding the right car insurance for a luxury model can mean savings of up to 20% on your premiums as well as protection for your car's expensive stereo kit or sunroof.
If you are not the type to keep the same car for a long period of time, a competitive car loan can also help you switch cars faster. Often, your car's deregistration value (the rebate that you'll get once you deregister your car before your COE expires) exceeds your remaining loan amount after 3-4 years. This means that you can find out when you can sell your car, pay off your loan completely and even have money left over to put towards your next purchase.
Take advantage of government discounts
Singapore is known for its expansive and well-maintained public transport system. If you buy a luxury car but don't use it for commuting to and from work everyday, you may actually save a good chunk of money if you register your car as off-peak. Savings include up to a S$17,000 rebate from the quota premium of your COE and ARF, S$500 discount on your annual road tax and a discounted car insurance premium for cars who see less than 8,000 km a year or drive during off-peak hours. Insurers like Budget Direct and Etiqa offer steep discounts ranging from 15% to 60% on premiums if your car is registered as off-peak.
Additionally, you can consider your car's fuel efficiency. If you are not set on a particular car make and are just looking to upgrade from a mid-priced sedan, you can qualify for more savings if you opt for an energy efficient luxury model. Some car models end up with a S$20,000 surcharge if the LTA deems them not energy efficient enough or if they are a Port Fuel Injection vehicle (like Lamborghinis).