Tesla Inc.’s Model 3 was Singapore’s top-selling sedan for the first time in September, as Elon Musk’s electric vehicle pioneer starts to make inroads in the world’s most expensive auto market.

New registrations of Teslas surged 89% to 312 last month versus August, according to Land Transport Authority data released Friday. Through the first nine months of the year, 517 Teslas were registered in the island city.

The U.S. company started selling its Model 3 in Singapore in February when it opened a dedicated web portal on the island. Singapore is providing incentives to encourage drivers to buy environmentally-friendly cars as it aims to reach net zero emissions as soon as viable.

Even so, buying a car in Singapore is expensive because drivers must pay excise and registration duties that are more than double the vehicle’s market value. They must also bid for a limited number of car-ownership permits that are auctioned by the government, which allow drivers to own a car for 10 years.

At an auction last week, 191 permits were sold for $85,000 each. On top of that, a Model 3 in Singapore starts at $113,245, more than double the U.S. base price.

Singapore plans to phase out fossil fuel-powered vehicles by 2040 and won’t allow diesel cars or taxis to be registered from 2025 as part of its efforts to reduce emissions. To support that drive, the government plans to install 60,000 charging points at public carparks and private premises by 2030, an increase from a previous target of 28,000.

Singapore had 2,243 electric cars on its roads at the end of September, 84% more than at the end of 2020, according to the Land Transport Authority. Still, that accounts of just 0.3% of the city-state’s cars.

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