Stay informed with free updates
Simply sign up to the Automobiles myFT Digest — delivered directly to your inbox.
Luxury car sales in Singapore have plummeted as buyers shun ostentatious displays of wealth after the government raised taxes on the vehicles and stepped up due diligence checks in response to a $2bn money-laundering scandal.
The number of new Bentley, Ferrari, Jaguar and Rolls-Royce models sold in the city-state dropped by as much as three-quarters last year compared with 2023, as wealthy buyers shunned luxury brands following a damaging money-laundering case in which police seized scores of flashy vehicles.
“Most of the luxury cars bought in recent years were by Chinese customers,” said Anson Lee, managing director of luxury car dealership Euro Performance Asia. “Following the scandal, you are now seeing the market stagnate.
“I still have Chinese customers, but they want to keep a low profile, so the whole market has slowed down,” said Lee, adding that his customers increasingly preferred electric vehicles.
EV sales have rocketed, particularly for Chinese manufacturer BYD, which was the second top-selling car brand in Singapore last year after only entering the market in 2020.
BYD sales hit 6,191 in 2024, a fourfold increase on the year before, while Tesla sales more than doubled to 2,384, according to figures from the Land Transport Authority.
At the same time, new Rolls-Royce sales dropped from 95 to 23 last year, while the figure for Ferrari fell from 97 to 29. The number of new Jaguars nearly halved to 27, while Bentley sales fell to 25 from 58.
Bentley attributed the decline to the run-out of existing models, with new versions of the Continental GT and Flying Spur entering the market only at the start of this year. It expects sales to improve with the availability of the new cars.
Jaguar, Ferrari and Rolls-Royce declined to comment.
Singapore has seen an influx of wealth in recent years, especially from Chinese nationals, as it competes to be Asia’s premier asset and wealth management hub, but the ambitions have also come with risk.
The city-state was rocked two years ago by a money-laundering case involving individuals linked to a gang from China’s Fujian province. During raids on properties across the island, police seized 77 vehicles.
At one property, four cars with a combined value of S$4.7mn (US$3.5mn) were confiscated, including a red Rolls-Royce Dawn, a black Rolls-Royce Cullinan, a red Porsche 911 Targa and a white Toyota Alphard.
“You see a lot fewer red Rolls-Royces cruising around Singapore these days,” said a person involved in the case in which 10 individuals have been sentenced.
Dealers said one of the reasons for the decline in new luxury vehicles was that the confiscated cars were being sold back to the market. Singapore’s justice minister, K Shanmugam, said last month that the government had so far sold 33 of the seized cars.
In response to the scandal, Singapore’s government ordered luxury car dealers, property agents and gemstone sellers to check sources of financing for their most expensive products and report buyers they suspected of having criminal links.
“We have [always had] to do our due diligence on customers, but this has become more sensitive because of the money-laundering case,” said Lee.
Luxury car sales have also been hit by a higher tax introduced in 2023 to cool what the government perceived as an overheated market coming out of the Covid-19 pandemic.
Taxes on the most expensive cars — those priced above S$80,000 — rose to 320 per cent from 220 per cent. The government also introduced changes to limit the resale value of cars.
Another consideration for buyers is the cost of certificates of entitlement, which residents must obtain before they are allowed to purchase a car. The prices are based on a bidding system to control the number of vehicles on the road.
For the most powerful models, the certificates currently cost just under S$117,000, up from S$96,000 a year ago but significantly below the S$150,000 pricetag in November 2023, reflecting a drop in demand for high-end vehicles.
Read the full article here
