Car Growth Policy's Impact on E-commerce Industry and Commercial Motorcycles

9 Mr Desmond Choo asked the Minister for Transport with the recent announcement of zero growth in cars and motorcycles by February 2018 (a) how will the Ministry ensure that this policy does not adversely impact the e-commerce industry; and (b) whether the Ministry will consider a separate COE category for commercial motorcycles.

The Senior Minister of State for Transport (Dr Lam Pin Min) (for the Minister for Transport): Mr Speaker, Sir, we will lower the Vehicle Growth Rate (VGR) from the current 0.25% per annum to 0% with effect from February 2018 for Certificates of Entitlement (COE) Categories A, B and D. However, we have maintained the existing 0.25% VGR for Category C commercial vehicles. This is to provide businesses with more time to improve the efficiency of their operations.

The current COE system sets aside Category D as a separate category for motorcycles so that motorcycle buyers need not compete with other vehicle buyers for COEs. Splitting Category D further would result in a smaller quota in each sub-category, which may lead to more volatility in prices.

Mr Speaker: Mr Desmond Choo.

Mr Desmond Choo (Tampines): I thank the Senior Minister of State for his reply. I have a clarification to make. In terms of setting the quota and the growth rate, did the Ministry take into account the requirements needed for other segments of the economy, especially the e-commerce industry which requires a lot of motorcycles and commercial vehicles? In the years ahead where online marketing and e-commerce become more prevalent, this requirement might increase. Would the Ministry then consider a review at a subsequent date?

Dr Lam Pin Min: I would like to thank the Member for the supplementary question. Yes, indeed, we do take into consideration some of these e-commerce businesses that are occurring in Singapore. However, as the Member may know, today, 12% of Singapore's total land is already taken up by roads. In view of our land constraints and competing needs, there is limited scope for further expansion of the road network. As I have mentioned in my reply, we are maintaining the existing 0.25% vehicle growth rate for Category C commercial vehicles to provide businesses with more time to improve the efficiency of their operations.

I am also glad to inform the Member that an interagency Urban Logistics Task Force comprising various agencies was convened in 2016 with the objective of facilitating the development of a more efficient urban logistics system which also reduces vehicle movements on the roads. Other ongoing work streams also include the development of a federated locker network to improve the distribution of goods from businesses to end consumers.

So, I do take the recommendation from the Member and we will review the vehicle growth rate in time.

Mr Speaker: Mr Leon Perera.

Mr Leon Perera (Non-Constituency Member): May I ask the Senior Minister of State: is this Committee considering accelerating the deployment of drones as one solution for urban logistics which would reduce the demands on our roads for cars but still allow e-commerce to develop? This is perhaps a very promising area to explore.

Dr Lam Pin Min: Yes, I agree with the Member. The deployment of drones is something that is also on the top of our minds. We are always constantly looking to innovative solutions to manage such situations.