A little bit of insight to make the headline more accurate.

In many cases, the buyer doesn't need to pay the full COE price. Dealerships have creative ways to "give discount" on the COE cost. Sometimes it involves overtrades, i.e. giving you more than your old car is worth when you trade in, and the extra then goes to subsidising the COE. Sometimes they simply bid for the COE under the dealership's name to register it first, then resell it later as a "guaranteed COE" car.

All these are quite attractive for buyers. The first route feels like a generous discount. The second negates the long wait for your new car – instead of having to go through the multiple bidding process, you can drive off with your car the very next week.

These methods eat into the dealership's profits for sure. But in dry months it's easier to sell more cars at smaller profits, than struggle to sell a few cars at larger profits.