1 00:00:00,340 --> 00:00:03,750 Speaker 1: Welcome back to another week of the Money Talks podcast. 2 00:00:03,759 --> 00:00:06,400 Speaker 1: I'm your host, Andrea Heng. If you want to learn 3 00:00:06,409 --> 00:00:10,149 Speaker 1: more about personal finance or what to invest in, we've 4 00:00:10,159 --> 00:00:12,988 Speaker 1: got a few episodes. You can check out on Spotify 5 00:00:13,000 --> 00:00:17,170 Speaker 1: Apple podcasts and youtube music while you're there. Hey, leave 6 00:00:17,180 --> 00:00:19,559 Speaker 1: me a note, won't you? Our team is currently on 7 00:00:19,569 --> 00:00:22,209 Speaker 1: a short break, but we've gone into the archives to 8 00:00:22,219 --> 00:00:24,399 Speaker 1: bring you some of our best performing 9 00:00:24,510 --> 00:00:28,389 Speaker 1: episodes. If you live in Singapore, you would already know 10 00:00:28,399 --> 00:00:32,930 Speaker 1: that our coe prices continue to break records each month. 11 00:00:32,939 --> 00:00:36,089 Speaker 1: So it's no surprise that many people are questioning if 12 00:00:36,098 --> 00:00:39,209 Speaker 1: owning a car is the best option anymore. In this 13 00:00:39,220 --> 00:00:42,689 Speaker 1: episode of the limited series, this or that I asked 14 00:00:42,700 --> 00:00:46,290 Speaker 1: my guest, Julian Koh of SG Car Mart own or 15 00:00:46,299 --> 00:00:48,569 Speaker 1: lease a car in Singapore. Take a listen. 16 00:00:49,209 --> 00:00:51,509 Speaker 1: You're listening to AC N A podcast. 17 00:00:59,729 --> 00:01:03,259 Speaker 1: Welcome to a brand new season of Money Talks. I'm 18 00:01:03,270 --> 00:01:06,389 Speaker 1: your host, Andrea Heng. We're kicking things off with a 19 00:01:06,400 --> 00:01:10,099 Speaker 1: new series called This or that and this is where 20 00:01:10,110 --> 00:01:13,319 Speaker 1: I give my guest two options and we weigh the 21 00:01:13,330 --> 00:01:17,139 Speaker 1: pros and cons and in today's debut episode we are 22 00:01:17,150 --> 00:01:20,449 Speaker 1: talking about cars. So my dad owned a car for 23 00:01:20,459 --> 00:01:23,738 Speaker 1: a little over three decades. The last car he owned, 24 00:01:23,750 --> 00:01:27,419 Speaker 1: it was falling apart. But the real reason he decided 25 00:01:27,430 --> 00:01:28,830 Speaker 1: to quit car ownership 26 00:01:29,024 --> 00:01:33,513 Speaker 1: altogether, it's not hard to guess. It was the killer ce, 27 00:01:33,524 --> 00:01:36,693 Speaker 1: I know everyone knows this or at least they should, 28 00:01:36,703 --> 00:01:40,773 Speaker 1: but Singapore is quite special when it comes to car ownership. 29 00:01:40,783 --> 00:01:43,984 Speaker 1: Even before you buy one, you need to pay for 30 00:01:43,994 --> 00:01:47,494 Speaker 1: a piece of paper that says you can own one 31 00:01:47,543 --> 00:01:51,643 Speaker 1: otherwise known as the certificate of entitlement or ce and 32 00:01:51,653 --> 00:01:54,793 Speaker 1: it's valid for 10 years. Now. At the last round 33 00:01:54,804 --> 00:01:58,174 Speaker 1: of bidding, this piece of paper cost between nine 34 00:01:58,267 --> 00:02:03,847 Speaker 1: $26,000 and 100 and $19,000 depending on the car size. 35 00:02:03,858 --> 00:02:07,447 Speaker 1: So like my dad, many people have now been priced 36 00:02:07,458 --> 00:02:11,498 Speaker 1: out of owning cars, but this also means drivers will 37 00:02:11,507 --> 00:02:15,498 Speaker 1: flock to car sharing and rentals. And this therefore pushes 38 00:02:15,507 --> 00:02:19,748 Speaker 1: these firms to acquire more cars and thus keeping those 39 00:02:19,757 --> 00:02:22,878 Speaker 1: co e prices high, will most of us never own 40 00:02:22,888 --> 00:02:26,647 Speaker 1: cars again. And if we really need one is leasing 41 00:02:26,657 --> 00:02:27,507 Speaker 1: perhaps a better 42 00:02:27,621 --> 00:02:30,620 Speaker 1: to option, buckle up. As I put this question to 43 00:02:30,632 --> 00:02:34,311 Speaker 1: my guest, Julian Koh, General Manager of SG Car Mart, 44 00:02:34,322 --> 00:02:38,542 Speaker 1: an online car marketplace for new and used cars. Hey, Julian, 45 00:02:38,552 --> 00:02:42,242 Speaker 1: welcome to money talks. As an introduction to our listeners. 46 00:02:42,251 --> 00:02:45,761 Speaker 1: Please tell us what car do you drive? When did 47 00:02:45,772 --> 00:02:48,442 Speaker 1: you get it? How much did you pay for it? 48 00:02:48,712 --> 00:02:52,361 Speaker 2: So, I recently switched cars. I think, a year ago, 49 00:02:52,371 --> 00:02:54,370 Speaker 2: maybe even a couple of years ago, I'm currently driving 50 00:02:54,382 --> 00:02:56,882 Speaker 2: a Toyota Crown. That's old school. I used to 51 00:02:56,975 --> 00:02:59,666 Speaker 2: drive a Civic type r, I love that car also. 52 00:02:59,675 --> 00:03:00,145 Speaker 2: Old school. 53 00:03:00,255 --> 00:03:02,035 Speaker 1: It's a driving school car. They call it, 54 00:03:02,485 --> 00:03:03,835 Speaker 2: but I had to, I had to let it go 55 00:03:03,845 --> 00:03:06,166 Speaker 2: and get the bigger one. So I'm driving a Toyota 56 00:03:06,175 --> 00:03:09,466 Speaker 2: Crown now. Ok. I must have paid 97 98,000 for it, 57 00:03:09,475 --> 00:03:09,895 Speaker 2: I think. 58 00:03:09,906 --> 00:03:11,916 Speaker 1: Ok. And how much was the coe on that? I 59 00:03:11,925 --> 00:03:14,225 Speaker 2: think the coe on that at the time was about 60 00:03:14,235 --> 00:03:16,084 Speaker 2: 50 grand there. About, 61 00:03:16,095 --> 00:03:18,876 Speaker 1: well, that number is completely now. 62 00:03:18,886 --> 00:03:21,076 Speaker 2: I know, I know. God knows when we'll ever see 63 00:03:21,085 --> 00:03:21,955 Speaker 2: that number again. I'm going 64 00:03:21,966 --> 00:03:24,005 Speaker 1: to ask you about your future decision in just a bit. 65 00:03:24,016 --> 00:03:26,234 Speaker 1: I'll save that for later. Would you ever consider 66 00:03:26,440 --> 00:03:28,410 Speaker 1: giving up your car though? Yes. Yes, 67 00:03:28,419 --> 00:03:30,419 Speaker 2: I really, yeah, in a heartbeat, in a heartbeat, 68 00:03:30,429 --> 00:03:34,229 Speaker 1: I will. Ok. Why after driving for so many years 69 00:03:34,570 --> 00:03:37,750 Speaker 1: and enjoying, of course, those low coe prices. What makes 70 00:03:37,759 --> 00:03:40,070 Speaker 1: you think you are able to survive without one? Um, 71 00:03:40,080 --> 00:03:43,630 Speaker 2: first and foremost, I will give up because it's expensive, 72 00:03:43,839 --> 00:03:46,550 Speaker 2: it's really expensive to own a car in Singapore. I mean, 73 00:03:46,559 --> 00:03:52,720 Speaker 2: just road tax insurance, the parking, occasional fines, right? I mean, er, 74 00:03:52,729 --> 00:03:55,550 Speaker 2: p petrol prices going off the roof. 75 00:03:55,684 --> 00:03:57,694 Speaker 2: This is really the main reason why I'll stop driving. 76 00:03:58,154 --> 00:04:00,893 Speaker 2: The other reason is because I think Singapore has one 77 00:04:00,904 --> 00:04:03,684 Speaker 2: of the best public transportations in the world. I mean, 78 00:04:03,694 --> 00:04:07,024 Speaker 2: if you travel enough, you'll realize that Singapore is really efficient. 79 00:04:07,033 --> 00:04:09,863 Speaker 2: Of course, we're probably not as efficient as Japan, for instance, 80 00:04:10,164 --> 00:04:12,803 Speaker 2: you know, maybe our train services, it may not be 81 00:04:12,813 --> 00:04:15,423 Speaker 2: as good as say, maybe Hong Kong. But I think 82 00:04:15,434 --> 00:04:17,864 Speaker 2: we are definitely up there with the best. 83 00:04:17,873 --> 00:04:20,053 Speaker 1: I agree. I've traveled quite a fair bit in the 84 00:04:20,063 --> 00:04:22,713 Speaker 1: big cities like London, New York where you think there 85 00:04:22,723 --> 00:04:24,944 Speaker 1: would be the best metropolitan 86 00:04:25,037 --> 00:04:29,047 Speaker 1: transportation system? Singapore, outshines those two cities, in my opinion, 87 00:04:29,058 --> 00:04:30,877 Speaker 1: at least. But yes, if you're going to compare us 88 00:04:30,888 --> 00:04:33,967 Speaker 1: to Japan and Hong Kong, that's a different story. Although 89 00:04:33,976 --> 00:04:36,897 Speaker 1: I don't think we're far behind. So what's going to 90 00:04:36,907 --> 00:04:40,097 Speaker 1: be your commute without the car train? 91 00:04:40,108 --> 00:04:42,888 Speaker 2: I guess I'm living near a train station. So that's fine. 92 00:04:42,898 --> 00:04:45,757 Speaker 2: That'll work. The only thing why I can't let go 93 00:04:45,767 --> 00:04:47,648 Speaker 2: of a car now is I've got to send the 94 00:04:47,657 --> 00:04:50,907 Speaker 2: kids to school and that's really a pain in all honesty. 95 00:04:50,916 --> 00:04:53,618 Speaker 2: I've actually tried it several times. So during COVID, when 96 00:04:53,627 --> 00:04:54,327 Speaker 2: we were all in lockdown, 97 00:04:54,661 --> 00:04:56,510 Speaker 2: I would actually take the train instead of driving them 98 00:04:56,522 --> 00:04:58,742 Speaker 2: to school. So I'll carry the bags and stuff, I'll 99 00:04:58,752 --> 00:05:01,291 Speaker 2: bring them to the station and it felt good. It 100 00:05:01,302 --> 00:05:03,622 Speaker 2: felt like, yeah, you know, I could live with this. Right. 101 00:05:03,630 --> 00:05:05,312 Speaker 2: And you do that for a couple of months and 102 00:05:05,321 --> 00:05:06,551 Speaker 2: you realize, you know, it's going to get a bit 103 00:05:06,562 --> 00:05:09,070 Speaker 2: tiring because it's only a home to school and school 104 00:05:09,082 --> 00:05:11,152 Speaker 2: to home because we're all working from home. Right. But 105 00:05:11,161 --> 00:05:14,111 Speaker 2: now it will be home to school, school to office. 106 00:05:14,122 --> 00:05:16,351 Speaker 2: So that's a different thing. And obviously I wouldn't be in, 107 00:05:16,361 --> 00:05:18,671 Speaker 2: you know, shirt pants and stuff, but I believe very 108 00:05:18,682 --> 00:05:22,032 Speaker 2: strongly that we can adapt. Right. So, my wife was saying, 109 00:05:22,041 --> 00:05:23,242 Speaker 2: but you know, if you have a car, we can 110 00:05:23,252 --> 00:05:23,570 Speaker 2: go from 111 00:05:23,746 --> 00:05:26,246 Speaker 2: point A to BC and then back home and I 112 00:05:26,255 --> 00:05:27,804 Speaker 2: told her, you know, if we don't have a car, 113 00:05:27,815 --> 00:05:30,605 Speaker 2: we'll just go point A B and then back home, 114 00:05:30,615 --> 00:05:32,776 Speaker 2: we'll live point C tomorrow next week. 115 00:05:32,786 --> 00:05:34,846 Speaker 1: I think it's about managing your route and managing your 116 00:05:34,855 --> 00:05:38,526 Speaker 1: time as well. Ultimately. Ok. So the reason we're here 117 00:05:38,536 --> 00:05:42,015 Speaker 1: obviously is to talk about those eye popping coe prices. 118 00:05:42,026 --> 00:05:45,645 Speaker 1: Is there some kind of psychological seeing like say category 119 00:05:45,656 --> 00:05:49,045 Speaker 1: A which is for cars up to 1600 CC, right? 120 00:05:49,055 --> 00:05:52,155 Speaker 1: It's at 96 now. So will it hit that 100 121 00:05:52,165 --> 00:05:52,566 Speaker 1: K 122 00:05:53,290 --> 00:05:55,829 Speaker 1: ceiling and then come down? How do you think this 123 00:05:55,839 --> 00:05:57,029 Speaker 1: is going to pan out? I think 124 00:05:57,040 --> 00:06:00,549 Speaker 2: AC OE is really all about supply and demand. So 125 00:06:00,559 --> 00:06:03,220 Speaker 2: I can't say that there will be a psychological ceiling, 126 00:06:03,230 --> 00:06:06,729 Speaker 2: but history has shown that prices have reached its peak 127 00:06:06,738 --> 00:06:10,440 Speaker 2: before decreasing. I mean, it could be because of consumer preferences, 128 00:06:10,450 --> 00:06:15,429 Speaker 2: economic conditions. So for instance, during COVID-19 pandemic, coe prices 129 00:06:15,440 --> 00:06:17,920 Speaker 2: did a fair bit because of the lack of demand. 130 00:06:17,928 --> 00:06:20,350 Speaker 2: So I don't think there's a psychological barrier to it, 131 00:06:20,359 --> 00:06:22,359 Speaker 2: although I do strongly believe it will hit the 100 132 00:06:22,454 --> 00:06:25,113 Speaker 2: grand very soon because cars at Expo is coming. I'm 133 00:06:25,123 --> 00:06:27,753 Speaker 2: sure it will drive the prices up. Yeah, indeed. 134 00:06:27,764 --> 00:06:31,044 Speaker 1: So my dad owned a car for a little over 135 00:06:31,053 --> 00:06:33,303 Speaker 1: three decades and then he gave it up because of 136 00:06:33,313 --> 00:06:36,253 Speaker 1: coe he really couldn't afford it anymore. And it wasn't 137 00:06:36,264 --> 00:06:38,134 Speaker 1: as if we were driving a brand new car, it 138 00:06:38,144 --> 00:06:40,634 Speaker 1: was second hand car. He did it for the family. 139 00:06:40,644 --> 00:06:43,472 Speaker 1: Same like you. But now his kids have moved out 140 00:06:43,484 --> 00:06:45,613 Speaker 1: married off. I don't need the car anymore. So I 141 00:06:45,623 --> 00:06:49,473 Speaker 1: introduced him to car sharing. So I used it first. 142 00:06:49,484 --> 00:06:51,713 Speaker 1: I experimented with it and I taught the 143 00:06:51,808 --> 00:06:53,787 Speaker 1: the rest of my family members to use it. So 144 00:06:53,798 --> 00:06:57,227 Speaker 1: what do you think needs to happen for more people 145 00:06:57,238 --> 00:06:59,917 Speaker 1: to give up their cars and perhaps take the alternative route? 146 00:06:59,928 --> 00:07:03,217 Speaker 1: Be it public transport or car sharing or car leasing 147 00:07:03,226 --> 00:07:04,667 Speaker 1: even which we'll get into later. 148 00:07:04,678 --> 00:07:07,166 Speaker 2: Prices need to go up higher. Coe prices need to 149 00:07:07,178 --> 00:07:07,817 Speaker 2: go up higher. So 150 00:07:07,827 --> 00:07:09,667 Speaker 1: that 100 KC needs to be there. 151 00:07:09,678 --> 00:07:12,708 Speaker 2: Yeah. Yeah, I strongly believe so. I'm not for high 152 00:07:12,717 --> 00:07:15,467 Speaker 2: prices obviously, but I'm all for coe and I say 153 00:07:15,477 --> 00:07:17,757 Speaker 2: this because the coe system has done a very good 154 00:07:17,768 --> 00:07:20,467 Speaker 2: job in controlling car population in Singapore. Ok. That's his 155 00:07:20,477 --> 00:07:21,067 Speaker 2: main purpose. 156 00:07:21,161 --> 00:07:24,291 Speaker 2: And I think it certainly ticked the box very accurately, 157 00:07:24,302 --> 00:07:28,582 Speaker 2: very efficiently. However, the problem in Singapore is that car 158 00:07:28,592 --> 00:07:31,601 Speaker 2: ownership has got a lot to do with status symbol. 159 00:07:31,611 --> 00:07:33,381 Speaker 2: It has got a lot to do with convenience as 160 00:07:33,391 --> 00:07:36,351 Speaker 2: well as comfort. Right. People buy cars because it's a 161 00:07:36,361 --> 00:07:39,832 Speaker 2: desirable thing. Man. If I drive a Mercedes Eclass, people 162 00:07:39,842 --> 00:07:42,032 Speaker 2: will think that, oh, my goodness. He's made it in life. 163 00:07:42,041 --> 00:07:42,242 Speaker 2: That 164 00:07:42,252 --> 00:07:46,731 Speaker 1: was exactly my dad's car. It was aspirational. Like my 165 00:07:46,742 --> 00:07:49,291 Speaker 1: goal is to own that Mercedes Eclass. 166 00:07:49,302 --> 00:07:50,421 Speaker 2: Yeah. So that's how it has all 167 00:07:50,515 --> 00:07:52,876 Speaker 2: always been. And of course, of late, the youngsters will 168 00:07:52,885 --> 00:07:54,466 Speaker 2: always be like, you know what I want comfort. I 169 00:07:54,476 --> 00:07:58,286 Speaker 2: want security. I want some privacy which obviously public transportation 170 00:07:58,295 --> 00:08:00,776 Speaker 2: can't provide. And then of course, in time of COVID, 171 00:08:00,786 --> 00:08:01,976 Speaker 2: they'll say, you know what? I don't want to take 172 00:08:01,985 --> 00:08:04,656 Speaker 2: public transportation because I don't want to risk getting COVID. 173 00:08:04,665 --> 00:08:06,415 Speaker 2: So I want to have my own car now that 174 00:08:06,425 --> 00:08:09,735 Speaker 2: we are living with COVID. I reckon apart from price, 175 00:08:09,746 --> 00:08:13,075 Speaker 2: people will need to realize just how expensive it is 176 00:08:13,085 --> 00:08:14,696 Speaker 2: to own a car. So you could probably buy a 177 00:08:14,705 --> 00:08:18,256 Speaker 2: car with a ce maybe costing you $2 maybe you'll 178 00:08:18,265 --> 00:08:19,805 Speaker 2: buy the car for $30,000. 179 00:08:20,100 --> 00:08:23,149 Speaker 2: That's your upfront payment. Let's just say you pay half 180 00:08:23,160 --> 00:08:25,250 Speaker 2: of that 15,000, which isn't a lot to own a 181 00:08:25,260 --> 00:08:28,279 Speaker 2: car in today's context, right? But your maintenance could be 182 00:08:28,290 --> 00:08:31,070 Speaker 2: really really high. I mean, you have your depreciation, you 183 00:08:31,079 --> 00:08:33,130 Speaker 2: have your road tax, you have your insurance, which is 184 00:08:33,140 --> 00:08:36,210 Speaker 2: an annual payment. By the way, you have parking your 185 00:08:36,219 --> 00:08:40,710 Speaker 2: occasional salmon. Right. Your petrol prices, your erps, it's constant payment. 186 00:08:40,719 --> 00:08:42,929 Speaker 2: If you put all of that together, we are talking 187 00:08:42,940 --> 00:08:47,219 Speaker 2: about a good 1002 2005 every month just to own 188 00:08:47,229 --> 00:08:49,150 Speaker 2: a car. If you put that into perspective, 189 00:08:49,473 --> 00:08:52,883 Speaker 2: think about it. Right. If you take grab every day, 190 00:08:52,893 --> 00:08:55,244 Speaker 2: are you really gonna hit 1,002,005? 191 00:08:55,254 --> 00:08:57,164 Speaker 1: Even with search pricing? Right. Exactly. 192 00:08:57,174 --> 00:08:59,613 Speaker 2: Unless you're telling me you're doing sales then yes. Ok. 193 00:08:59,624 --> 00:09:01,763 Speaker 2: I can understand. You got run from point to point. 194 00:09:01,773 --> 00:09:04,453 Speaker 2: I can understand you might even hit 2000. Maybe getting 195 00:09:04,463 --> 00:09:06,314 Speaker 2: a car would be a better option for you. But 196 00:09:06,323 --> 00:09:07,963 Speaker 2: I mean, and I say this with a lot of 197 00:09:07,973 --> 00:09:10,203 Speaker 2: confidence because I did it before. It was like an 198 00:09:10,213 --> 00:09:12,382 Speaker 2: experiment because I wanted to show my wife that, you 199 00:09:12,393 --> 00:09:14,234 Speaker 2: know what I think getting a car is a wrong move. 200 00:09:14,244 --> 00:09:16,533 Speaker 2: I think we should not get a car. Let's just 201 00:09:16,544 --> 00:09:18,484 Speaker 2: go public wherever we want to go. We, 202 00:09:18,578 --> 00:09:21,567 Speaker 2: we need to go, let's take a taxi. I call 203 00:09:21,578 --> 00:09:22,437 Speaker 2: a grab or something. 204 00:09:22,458 --> 00:09:24,647 Speaker 1: You know, if you really need that comfort and the 205 00:09:24,658 --> 00:09:25,556 Speaker 1: space to ferry 206 00:09:25,567 --> 00:09:28,757 Speaker 2: everyone. Exactly. And we tried that for good 30 days 207 00:09:28,768 --> 00:09:31,338 Speaker 2: and we realized how much money we can actually save 208 00:09:31,867 --> 00:09:33,958 Speaker 2: and trust me when I sold my previous car when 209 00:09:33,968 --> 00:09:37,278 Speaker 2: I got back, that lump sum of money. Right. Yeah, 210 00:09:37,288 --> 00:09:40,107 Speaker 2: all I did. I immediately called my wife and said, 211 00:09:40,117 --> 00:09:41,677 Speaker 2: you know what? I think we shouldn't get the car. 212 00:09:41,687 --> 00:09:44,078 Speaker 2: We should just keep this money. I mean, put it aside, 213 00:09:44,088 --> 00:09:46,567 Speaker 2: do whatever we want. We could buy stuff for the 214 00:09:46,578 --> 00:09:47,838 Speaker 2: kids to bring them for 215 00:09:47,932 --> 00:09:50,382 Speaker 2: holiday. You know, and she just went, no, you know what? 216 00:09:50,392 --> 00:09:52,872 Speaker 2: It's impossible. It's genuinely impossible. 217 00:09:52,881 --> 00:09:56,632 Speaker 1: especially if you're very used to it for a specific purpose. 218 00:09:56,642 --> 00:09:59,992 Speaker 1: I know of people who own cars specifically because they 219 00:10:00,002 --> 00:10:03,072 Speaker 1: are the sole caregivers of their elderly parents. For example, 220 00:10:03,081 --> 00:10:07,052 Speaker 1: family members with disabilities and taking a cab. It's not 221 00:10:07,062 --> 00:10:10,961 Speaker 1: the most logistically comfortable situation. If you're used to a 222 00:10:10,971 --> 00:10:13,911 Speaker 1: certain level of comfort for a specific purpose, maybe when 223 00:10:13,921 --> 00:10:16,081 Speaker 1: the kids are older, they're more independent. 224 00:10:16,101 --> 00:10:17,030 Speaker 2: I can't wait, 225 00:10:18,000 --> 00:10:19,729 Speaker 2: I can't wait, man. Every 226 00:10:19,739 --> 00:10:21,020 Speaker 1: parent is telling me this. 227 00:10:24,840 --> 00:10:27,510 Speaker 1: Hi. My name is Julie Yu and I'm the host 228 00:10:27,520 --> 00:10:31,189 Speaker 1: of the Climate conversations. Each week I speak to guests 229 00:10:31,200 --> 00:10:34,189 Speaker 1: who give us tips on how we can protect the earth. 230 00:10:34,239 --> 00:10:37,950 Speaker 1: Every once in a while. We also have interesting stories 231 00:10:37,960 --> 00:10:41,580 Speaker 1: like how Singapore's first Tesla owner prompted billionaire 232 00:10:41,669 --> 00:10:44,439 Speaker 1: Elon Musk to reach out to Prime Minister Lee Hsien 233 00:10:44,659 --> 00:10:48,289 Speaker 1: Long or a chef who makes the juiciest burgers from 234 00:10:48,299 --> 00:10:52,570 Speaker 1: only plant based ingredients. For more stories like these, look 235 00:10:52,580 --> 00:10:55,489 Speaker 1: for the climate conversations on our CN A and me 236 00:10:55,500 --> 00:10:58,479 Speaker 1: listen apps or wherever you get your podcasts. 237 00:11:02,020 --> 00:11:05,539 Speaker 1: So the other option, apart from car sharing is leasing 238 00:11:05,549 --> 00:11:08,039 Speaker 1: a car, which is what some of those people I 239 00:11:08,049 --> 00:11:10,659 Speaker 1: spoke to who drive a car to ferry certain family 240 00:11:10,669 --> 00:11:13,450 Speaker 1: members around. They are doing just that. Can you walk 241 00:11:13,460 --> 00:11:17,109 Speaker 1: us through the pros and cons of leasing a car? 242 00:11:17,130 --> 00:11:20,500 Speaker 1: And how is that different from actually renting a car? 243 00:11:20,510 --> 00:11:23,419 Speaker 2: Ok. So if you get a car from a car, 244 00:11:23,429 --> 00:11:27,219 Speaker 2: leasing company, it's usually for a longer period of time 245 00:11:27,229 --> 00:11:28,968 Speaker 2: and extended period of time. So you're not going to 246 00:11:28,979 --> 00:11:29,270 Speaker 2: lease 247 00:11:29,346 --> 00:11:32,026 Speaker 2: car for three days, for instance, for whatever Chinese New Year, 248 00:11:32,035 --> 00:11:34,956 Speaker 2: Harry Rya, you'll probably do it because you want to 249 00:11:34,966 --> 00:11:37,886 Speaker 2: try car ownership for a while. So it's probably six 250 00:11:37,896 --> 00:11:41,236 Speaker 2: months minimum up to a year. The advantages of going 251 00:11:41,247 --> 00:11:43,915 Speaker 2: through car leasing is that you don't have to fork 252 00:11:43,927 --> 00:11:46,026 Speaker 2: out that one lump sum of down payment. So you 253 00:11:46,035 --> 00:11:47,526 Speaker 2: just go up to a company and say, you know 254 00:11:47,535 --> 00:11:49,726 Speaker 2: what I want to lease this car and they'll say, ok, 255 00:11:49,736 --> 00:11:52,617 Speaker 2: your monthly payment is X amount of dollars, everything is covered, 256 00:11:52,627 --> 00:11:56,846 Speaker 2: road tax insurance, everything. However, you don't own 257 00:11:56,924 --> 00:12:00,263 Speaker 2: that car, which means to say you can't modify that car. 258 00:12:00,273 --> 00:12:01,744 Speaker 2: You can't just say, oh, you know what? I don't 259 00:12:01,754 --> 00:12:03,883 Speaker 2: really like this champagne color. I want it black. I 260 00:12:03,893 --> 00:12:06,643 Speaker 2: would like to have it resprayed. No, you can't do 261 00:12:06,653 --> 00:12:09,004 Speaker 2: that either. You can't even have it wrapped because it 262 00:12:09,013 --> 00:12:12,573 Speaker 2: ate yours. Exactly. That So you don't have that ownership. 263 00:12:12,583 --> 00:12:15,234 Speaker 2: Is that really important though? I know it's not in 264 00:12:15,244 --> 00:12:18,814 Speaker 2: line with the business that I represent, but I feel 265 00:12:18,823 --> 00:12:22,132 Speaker 2: there's a need to be honest and pragmatic. Yes. And 266 00:12:22,143 --> 00:12:24,453 Speaker 2: I think car ownership in Singapore is just a 267 00:12:24,500 --> 00:12:26,580 Speaker 2: no go if you don't need a car. And I 268 00:12:26,591 --> 00:12:29,041 Speaker 2: think a lot of people can't draw the line between 269 00:12:29,051 --> 00:12:31,140 Speaker 2: a one and a need, I want a car, I 270 00:12:31,151 --> 00:12:33,760 Speaker 2: want a Ferrari, right? But I can't, I mean, I 271 00:12:33,770 --> 00:12:37,340 Speaker 2: don't really need a Ferrari. Arguably people would say that 272 00:12:37,351 --> 00:12:40,481 Speaker 2: someone with three kids may not even need a car, right? 273 00:12:40,570 --> 00:12:43,551 Speaker 2: So it's really up to individual. But if you ask me, 274 00:12:43,559 --> 00:12:47,041 Speaker 2: car leasing is a much better option compared to car 275 00:12:47,051 --> 00:12:48,181 Speaker 2: buying because will it 276 00:12:48,190 --> 00:12:50,540 Speaker 1: save you more in the long run? 277 00:12:50,551 --> 00:12:51,890 Speaker 2: Do you think I don't reckon 278 00:12:52,078 --> 00:12:54,367 Speaker 2: save you more in the long run financially? But I 279 00:12:54,377 --> 00:12:56,617 Speaker 2: think it saves you a lot of trouble. It gives 280 00:12:56,627 --> 00:12:59,268 Speaker 2: you an experience. So you get a car and you 281 00:12:59,278 --> 00:13:01,277 Speaker 2: sort of realize like, oh man, I mean, I've got 282 00:13:01,288 --> 00:13:04,677 Speaker 2: to consider parking, I've got to consider patrol. I'm starting 283 00:13:04,687 --> 00:13:07,107 Speaker 2: to feel like it's eating into my savings or it's 284 00:13:07,117 --> 00:13:10,497 Speaker 2: eating inside my bank account. Is this really for me 285 00:13:10,506 --> 00:13:12,648 Speaker 2: and we never want this to happen to anybody. But 286 00:13:12,658 --> 00:13:15,158 Speaker 2: once in a while you get into minor accidents and 287 00:13:15,168 --> 00:13:17,937 Speaker 2: then you have to send the car for repair, the hassle, 288 00:13:17,947 --> 00:13:19,578 Speaker 2: the mental stress, it be like, 289 00:13:19,655 --> 00:13:21,114 Speaker 2: oh man, I got to do this, I got to 290 00:13:21,125 --> 00:13:22,603 Speaker 2: do that, but I have to be in the office. 291 00:13:22,614 --> 00:13:25,515 Speaker 2: It's a lot of things to really seriously consider. Do 292 00:13:25,525 --> 00:13:25,655 Speaker 2: you 293 00:13:25,664 --> 00:13:29,614 Speaker 1: see then a trend of people moving towards leasing because 294 00:13:29,625 --> 00:13:32,474 Speaker 1: of the high coes, do you see that wave of 295 00:13:32,484 --> 00:13:36,674 Speaker 1: people just being pushed towards these alternative options? 296 00:13:36,684 --> 00:13:38,635 Speaker 2: I think it's a bit of both. I see it 297 00:13:38,645 --> 00:13:40,815 Speaker 2: as a funnel. You know, it's like a funnel sort 298 00:13:40,825 --> 00:13:46,164 Speaker 2: of model at the top. You have people leasing, renting, buying, borrowing, 299 00:13:46,174 --> 00:13:47,044 Speaker 2: what have you and 300 00:13:47,231 --> 00:13:50,591 Speaker 2: you flow down the ultimate goal of Singaporeans. And I 301 00:13:50,601 --> 00:13:53,211 Speaker 2: say Singaporeans because I'm a Singaporean. The ultimate goal is 302 00:13:53,221 --> 00:13:56,611 Speaker 2: owning that car, that Eclass or that five series or 303 00:13:56,622 --> 00:14:00,341 Speaker 2: that F type whatever, right? So that's the ultimate funnel 304 00:14:00,351 --> 00:14:02,771 Speaker 2: right at the bottom is just, I want to own 305 00:14:02,780 --> 00:14:04,731 Speaker 2: a car, they do whatever it takes to get there. 306 00:14:04,742 --> 00:14:08,211 Speaker 2: But those who can't, will start thinking about leasing will 307 00:14:08,221 --> 00:14:12,330 Speaker 2: start to think about renting car sharing even. Will more 308 00:14:12,341 --> 00:14:14,731 Speaker 2: people go towards that? I think. 309 00:14:15,169 --> 00:14:18,189 Speaker 2: Yes and no, because it's an inevitable thing to some. 310 00:14:18,198 --> 00:14:19,648 Speaker 2: I don't want to lease a car. I only want 311 00:14:19,658 --> 00:14:21,578 Speaker 2: to own a car no matter how much it takes 312 00:14:21,588 --> 00:14:23,848 Speaker 2: in general, say I have $10 in my wallet, I'm 313 00:14:23,859 --> 00:14:26,169 Speaker 2: willing to take $10 and I'm willing to do $5 314 00:14:26,179 --> 00:14:28,249 Speaker 2: on credit just to get to the end of the funnel. 315 00:14:28,258 --> 00:14:31,068 Speaker 2: It's not advisable. Obviously, financially. But I do think more 316 00:14:31,078 --> 00:14:34,028 Speaker 2: people would think about leasing. I also do know quite 317 00:14:34,039 --> 00:14:35,958 Speaker 2: a handful of people who will hold on to their 318 00:14:35,968 --> 00:14:38,408 Speaker 2: cars till the end of the co E life span 319 00:14:38,419 --> 00:14:40,908 Speaker 2: and they'll just renew the CO E again. 320 00:14:40,979 --> 00:14:42,299 Speaker 1: Yeah. But at 90 321 00:14:42,385 --> 00:14:46,075 Speaker 1: 6 to 100 and 19 K, that's a very expensive 322 00:14:46,085 --> 00:14:48,085 Speaker 1: piece of paper just to keep that car and you're 323 00:14:48,096 --> 00:14:49,616 Speaker 1: not even sure if that car is going to run 324 00:14:49,625 --> 00:14:53,135 Speaker 1: as smoothly as it used to for the next 10 years. Well, 325 00:14:53,145 --> 00:14:53,565 Speaker 1: I think 326 00:14:53,575 --> 00:14:56,505 Speaker 2: only the owner will know because how often he has 327 00:14:56,515 --> 00:14:59,765 Speaker 2: been servicing how much he babied the car would actually 328 00:14:59,776 --> 00:15:02,205 Speaker 2: be a good gauge for him. And if you think 329 00:15:02,216 --> 00:15:04,435 Speaker 2: about it, let's just say cat a for instance. Right. 330 00:15:04,445 --> 00:15:07,325 Speaker 2: Cat A is approximately 96 let's just say it's 100,000. 331 00:15:07,335 --> 00:15:09,885 Speaker 2: If I renew my car based on that number, 332 00:15:10,093 --> 00:15:13,463 Speaker 2: my annual depreciation would be 10,000 a year, which is 333 00:15:13,473 --> 00:15:17,463 Speaker 2: still cheaper compared to current prices of new cars. If 334 00:15:17,473 --> 00:15:19,213 Speaker 2: I know that I've been babying my car, I've been 335 00:15:19,223 --> 00:15:22,132 Speaker 2: really taking good care of my car servicing regularly 336 00:15:22,153 --> 00:15:24,163 Speaker 1: and if it's a car where you can get spare 337 00:15:24,172 --> 00:15:24,982 Speaker 1: parts easily. 338 00:15:24,992 --> 00:15:28,732 Speaker 2: Yes, exactly. That I would actually spend 100,000 renewing. Yes, 339 00:15:28,793 --> 00:15:33,223 Speaker 1: because you're effectively paying 100,000 more just for the car 340 00:15:33,232 --> 00:15:33,982 Speaker 1: ownership and to 341 00:15:33,992 --> 00:15:36,043 Speaker 2: run it and for the next 10 years. So if 342 00:15:36,052 --> 00:15:37,463 Speaker 2: anything happens, I will still 343 00:15:37,539 --> 00:15:38,919 Speaker 2: be able to sell the car on SG car. But 344 00:15:38,929 --> 00:15:40,840 Speaker 2: for instance, and if no one wants to buy the car, 345 00:15:40,849 --> 00:15:43,260 Speaker 2: I'll still be able to scrap my car, say maybe 346 00:15:43,270 --> 00:15:45,380 Speaker 2: the third or fourth year and get back the remaining 347 00:15:45,390 --> 00:15:46,460 Speaker 2: value of the ce that I've 348 00:15:46,469 --> 00:15:49,909 Speaker 1: paid. So it's about usage then. Yes, it is also 349 00:15:49,919 --> 00:15:53,039 Speaker 1: about usage. What's the demographic like of someone who would 350 00:15:53,049 --> 00:15:55,559 Speaker 1: lease a car apart from those who would want to 351 00:15:55,570 --> 00:15:57,559 Speaker 1: try out car ownership for a while? 352 00:15:57,570 --> 00:15:59,780 Speaker 2: I mean, if you exclude those who want to try 353 00:15:59,789 --> 00:16:02,760 Speaker 2: out car ownership and you exclude those who just want 354 00:16:02,770 --> 00:16:05,030 Speaker 2: to impress their friends and their girlfriends, 355 00:16:06,270 --> 00:16:08,979 Speaker 2: it will probably be maybe 50 to 60 year olds. 356 00:16:08,989 --> 00:16:13,059 Speaker 2: And I say that because my dad is now what, 72. 357 00:16:13,070 --> 00:16:14,429 Speaker 2: And he told me once that, you know what I 358 00:16:14,440 --> 00:16:18,780 Speaker 2: want to stop driving when I'm 65 which he did, 359 00:16:18,789 --> 00:16:21,330 Speaker 2: he did stop driving at 65. But I kind of 360 00:16:21,340 --> 00:16:24,090 Speaker 2: realized that between the age of 60 to 65 your 361 00:16:24,099 --> 00:16:27,489 Speaker 2: reaction time isn't as good anymore. You're slightly slower, you're 362 00:16:27,500 --> 00:16:30,460 Speaker 2: grumpier on the road. So I think it's good. 50 363 00:16:30,469 --> 00:16:32,280 Speaker 2: to 60 years old. Right. Yeah. 364 00:16:32,289 --> 00:16:34,340 Speaker 1: Ok. That's an interesting subset there. 365 00:16:34,442 --> 00:16:37,982 Speaker 1: So let's say we're looking at a period of five years. 366 00:16:37,992 --> 00:16:41,422 Speaker 1: Would it be more expensive to buy or lease a car? 367 00:16:41,432 --> 00:16:45,263 Speaker 1: Keeping in mind? Of course, all those wonderful things that 368 00:16:45,273 --> 00:16:48,463 Speaker 1: bleed our wallets, maintenance, insurance, road tax. 369 00:16:48,473 --> 00:16:50,653 Speaker 2: The like as in five years as a brand new 370 00:16:50,663 --> 00:16:53,143 Speaker 2: car or five years used car. Uh, let's go with 371 00:16:53,153 --> 00:16:55,692 Speaker 2: used first. I would say you should just go with 372 00:16:55,703 --> 00:16:58,492 Speaker 2: a five year old used car. I mean, if you 373 00:16:58,502 --> 00:17:00,232 Speaker 2: just want to try it out for five years and 374 00:17:00,242 --> 00:17:01,853 Speaker 2: five years is not a short time, five years is 375 00:17:01,862 --> 00:17:02,583 Speaker 2: a relatively long. 376 00:17:02,866 --> 00:17:05,566 Speaker 2: But if you are confident, maybe you have tried certain 377 00:17:05,576 --> 00:17:07,926 Speaker 2: models before and you really like it. I say you 378 00:17:07,936 --> 00:17:09,946 Speaker 2: should just go for the used car because it's the 379 00:17:09,955 --> 00:17:11,514 Speaker 2: final thing. You know, at the end of it I 380 00:17:11,526 --> 00:17:14,145 Speaker 2: want to be an owner to a car. Right. May 381 00:17:14,156 --> 00:17:16,245 Speaker 2: not be an eclass. May not be a five series, 382 00:17:16,255 --> 00:17:18,046 Speaker 2: but I would like to own a car. I would 383 00:17:18,056 --> 00:17:20,796 Speaker 2: like the car to be under my name. So, at 384 00:17:20,806 --> 00:17:22,576 Speaker 2: the end of it, I think if it's a five 385 00:17:22,595 --> 00:17:25,696 Speaker 2: year thing, yeah, you could consider getting an economic car, 386 00:17:25,705 --> 00:17:26,556 Speaker 2: I could say. Yeah. 387 00:17:26,566 --> 00:17:29,765 Speaker 1: What about a five year new car versus leasing there? Oh, man. 388 00:17:29,776 --> 00:17:30,666 Speaker 2: Definitely, 389 00:17:31,469 --> 00:17:36,500 Speaker 2: definitely leasing because new car prices are crazy today. It's 390 00:17:36,510 --> 00:17:40,060 Speaker 2: not worth the money. It's not worth the financial stress 391 00:17:40,069 --> 00:17:42,089 Speaker 1: unless of course you can really 392 00:17:42,099 --> 00:17:44,339 Speaker 2: afford it. Yeah. But you see, that's my argument. Right. 393 00:17:44,349 --> 00:17:46,069 Speaker 2: I mean, I told a friend just because you're well 394 00:17:46,079 --> 00:17:48,839 Speaker 2: to do does not mean that you should spend so 395 00:17:48,849 --> 00:17:50,579 Speaker 2: much on a liability. 396 00:17:50,589 --> 00:17:53,310 Speaker 1: Yeah, it depreciates the moment it's out of the showroom. 397 00:17:53,319 --> 00:17:56,139 Speaker 2: Exactly. And what's worse is, we came from a time 398 00:17:56,150 --> 00:17:59,849 Speaker 2: when cars weren't this expensive. So if I say, for instance, 399 00:17:59,859 --> 00:18:00,510 Speaker 2: a Suzuki suit, 400 00:18:00,582 --> 00:18:04,071 Speaker 2: if we knew what it cost 10 years ago, and 401 00:18:04,082 --> 00:18:06,682 Speaker 2: now you're telling me this is the price, no way. 402 00:18:07,232 --> 00:18:10,041 Speaker 2: I mean, yeah, even if you've got the money to spend, 403 00:18:10,052 --> 00:18:13,741 Speaker 2: it's in your bank there doing absolutely nothing does not 404 00:18:13,751 --> 00:18:16,482 Speaker 2: mean that you should just splurge like this. That's 405 00:18:16,491 --> 00:18:20,232 Speaker 1: me. And on that note, what's your financial advice to 406 00:18:20,241 --> 00:18:22,982 Speaker 1: a potential car buyer in terms of what to look 407 00:18:22,991 --> 00:18:23,682 Speaker 1: out for? 408 00:18:23,692 --> 00:18:27,722 Speaker 2: You should always consider all the maintenance cost of owning 409 00:18:27,732 --> 00:18:29,842 Speaker 2: a car. So like what I mentioned before, 410 00:18:29,923 --> 00:18:35,822 Speaker 2: regular maintenance, servicing petrol insurance, road tax, but more importantly, 411 00:18:35,833 --> 00:18:39,293 Speaker 2: you should also think about your financing options, which financing 412 00:18:39,303 --> 00:18:43,014 Speaker 2: options suit you in your current financial status. That would 413 00:18:43,023 --> 00:18:45,104 Speaker 2: actually not rock your boat too much. 414 00:18:45,114 --> 00:18:48,822 Speaker 1: A car is convenient, especially when you have Children. But 415 00:18:48,833 --> 00:18:53,193 Speaker 1: increasingly the cost is far outpacing the benefits of owning 416 00:18:53,203 --> 00:18:56,323 Speaker 1: one with some of the best public transport networks and 417 00:18:56,333 --> 00:18:59,183 Speaker 1: different leasing opportunities. It's become a lot 418 00:18:59,276 --> 00:19:02,125 Speaker 1: easier for us to mix and match things up. That's 419 00:19:02,135 --> 00:19:05,495 Speaker 1: it for this episode of this or that. Thanks Julian 420 00:19:05,505 --> 00:19:07,916 Speaker 1: for helping us weigh the pros and cons of buying 421 00:19:07,926 --> 00:19:10,764 Speaker 1: versus facing a car any time. Thank you for having me. 422 00:19:10,776 --> 00:19:13,545 Speaker 1: If you have enjoyed this episode of Money talks, there 423 00:19:13,556 --> 00:19:16,485 Speaker 1: is more content for you to enjoy. Simply follow us 424 00:19:16,494 --> 00:19:20,566 Speaker 1: on Google Spotify or Apple podcasts, give us five stars 425 00:19:20,576 --> 00:19:23,395 Speaker 1: or leave a review. The team behind Money Talks is 426 00:19:23,406 --> 00:19:28,485 Speaker 1: Joanne Chan, Jacqueline Chansa Wint Christina Robert and I'm Andrea Hing.