Category A hits $133,009. The number that matters more is 19,085.

Category A closed at a record $133,009 in the 9 September bidding exercise, up $4,508 from $128,501. Category B rose to $135,001 from $131,001, and Category C for goods vehicles and buses moved to $93,101 from $90,002. Motorcycles closed at $12,556 and the Open category reached $137,890.

There were 4,776 bids against a quota of 3,253 certificates, which is 1.47 bidders for every certificate available. That ratio is the mechanism. Nothing more complicated than it is happening.

The number worth reading

The quota for the August to October period is 19,085, an increase of 0.2 per cent on the previous quarter's 19,052.

That is the result. Not the record.

For most of this year the reasonable case for waiting has rested on supply. Cars registered in 2016 reach ten years from this year onward, deregistrations feed the quota, and quota is what actually sets the premium in an auction with a fixed number of certificates. Wait for the cohort to come through, the argument went, and premiums soften on their own.

The August to October allocation says that has not happened yet. Thirty-three additional certificates across three months is not a supply response. It is a rounding difference. Demand rose into a quota that did not move, and the premium did what a premium does in that situation.

This does not mean the supply argument is wrong. It means it has not arrived on the timetable people assumed, and one flat quarter is not a trend either. But anyone who has been holding off on the basis that the quota was about to open up now has a data point that says otherwise, and should decide whether they are waiting for a reason or out of habit.

The gap that closed while nobody watched

Here is the thing almost nobody will report today.

Category B sits at $135,001. Category A sits at $133,009. The gap is $1,992.

In the first March exercise that gap was $5,782. It has narrowed by roughly two thirds across six months, and it has been under $2,600 since July.

The practical version. Category A is for cars up to 1,600cc with power output up to 97kW. Category B is everything above that. For years, choosing a Category A car meant accepting a smaller, less powerful car in exchange for a materially cheaper certificate. That trade has thinned to under two thousand dollars.

It does not mean everyone should buy a bigger car. Road tax scales with engine capacity and does not care what the COE did, and a 2.0 litre car costs meaningfully more to tax and fuel over a decade than a 1.6. But the certificate is no longer doing much of the work in that decision, and if the last time you thought about it was two years ago, the arithmetic has changed underneath you.

What this does to renewals

Anyone approaching the ten year mark pays the Prevailing Quota Premium, which is a rolling three month average rather than the latest close. The August exercise carried a September Category A PQP of $126,208 and a Category B PQP of $128,697.

A record close in September feeds into the October figure and pushes it up. How far depends on which rounds drop out of the average, and the honest answer is that you should read the October number on OneMotoring rather than take an estimate from anyone, including us.

What is worth saying plainly is the direction. If you are deciding between renewing and deregistering in the next few months, the renewal side of that comparison is getting more expensive, and the PARF rebate you forfeit by renewing does not move to compensate. We set out the full comparison in What happens at the ten year mark, renew, scrap or sell.

What this does to used prices

Nothing directly, and this gets stated wrongly constantly.

A rising COE does not raise the paper value of a car already on the road. The COE rebate is calculated against the premium paid when that car was registered, not against today's $133,009. A car registered on a $92,000 certificate has its rebate worked out on $92,000 regardless of what happened this afternoon.

The effect runs through demand instead. Higher premiums land on the on-the-road price of every new car registered against them, buyers priced out of new arrive in the used market, and dealers pay more to acquire replacement stock. Used prices follow, with a lag of a round or two, and they follow in both directions. We covered the full mechanism, and what it does to the quality of available stock rather than just the price, in COE is back near its record.

The honest counterweight

Three things worth holding onto.

One exercise is one exercise. Category A fell from $128,501 in August after rising from $123,890 two weeks before that. Premiums move both ways within a quarter and the record set today has been beaten twice this year already.

The supply case has not been disproved, only delayed. The deregistration cohort is real and it is coming. A flat quarter tells you it is not here yet. It does not tell you it is not coming.

Nobody predicted this. Including the people who will explain it confidently tomorrow. The next exercise opens on 21 September and closes on 23 September, and anyone who tells you where it lands is guessing with a straight face.

What to do with it

If you are buying new, the certificate is now a larger share of what you are paying and the Category A saving is close to gone. That is worth reworking rather than assuming.

If you are buying used, this changes the market you are buying in but it does not change which car is right for you. Run the depreciation, which is price minus PARF over the years left on the certificate, and compare that number rather than the monthly.

If you are facing renewal, get the October PQP from OneMotoring, get the ARF from your log card, and do the comparison properly before the deadline rather than in the week before it.