Singapore's supercar dealers fret as taxes, loan rules stall sales

Wed Aug 6, 2014 7:28am EDT
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By Caroline Ng

SINGAPORE (Reuters) - Supercar dealers in wealthy Singapore are fretting over their future as higher taxes, new auto loan restrictions and a shift in tastes towards less ostentatious vehicles send sales plummeting.

While the roar of high-octane engines is a familiar sound in central Singapore, home to the third-highest ratio of millionaires per capita in the world, supercar showrooms are largely silent.

Now some dealers are setting up pre-owned divisions and throwing huge launch parties for new models in a bid to get business back on track.

"If this situation continues, we believe that supercar dealers will not be able to sustain a viable operation based on the huge infrastructure put in place as well as the high cost of running the business," said Kevin John Chia, general manager of Aston Martin Singapore.

While tiny Singapore's auto market is minute in global terms, its luxury car segment was, until recently, punching above its weight.

Last year it was the third-biggest market in the world for bespoke Rolls-Royce sales while Porsche is among the top 15 selling brands of car, something unheard of in western markets.

But new taxes started in March 2013 and curbs on car loans have sent sales of some supercar brands down by as much as 90 percent, figures from the Land Transport Authority show.

Two new Aston Martins, two Lamborghinis and 14 Ferraris were sold in the first half of 2014, compared to 16, 20 and 64 respectively in the same period a year ago.   Continued...

Sales Manager Raymond Liu switches on the headlights of an Aston Martin Vanquish at their showroom in Singapore August 1, 2014. REUTERS/Edgar Su