You might have recalled I re-initiated a position back in Vicom just last month (See here) so when someone alerted me today that they were revising their fees I was interested to look at it.
This wasn’t yet officially announced in the sgx announcement so some vested shareholders might miss the news.
|New revised fees w.e.f 1 Nov 2017|
As you can see from the breakdown, the revised fees aren’t very significant from a car owner perspective in terms of dollars and sense. In fact, it’s probably just enough to cover an incremental cost of the overhead due to inflation next year. They’ve been very conservative in raising the price.
This news came about after LTA announces that it will cut the growth of vehicle on the street to 0% from FY18 onwards. What this means in terms of impact is probably more COE being extended after 10 years which will boost the more regular annual inspection (instead of once in two years).
With taxi fleets continuing to shrink at a single digit rate due to an oversupply market, Vicom’s inspection fees will also take the hit since taxi fleet goes for much more regular inspection on a semi-annual basis.
The big changes if any from LTA, will be regulating the same policy changes to the private hire cars on the street to a more frequent inspection. This will be a key driver to Vicom’s inspection business.
Thanks for reading.
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