New car sales in Europe and a half-world away in Australia have increased significantly this year, indicating the automotive industry is recovering supply shortages caused by the COVID pandemic, according to industry groups.

Australian Sales Reaches Record High in July

New car deliveries in Australia reached a record 96,859 units in July, according to the Federal Chamber of Automotive Industries (FCAI), reported the Australasian Fleet Management Association (AfMA).

The sales numbers across every Australian state and territory represent a 14.7% increase over the same month in 2022 and breaks the Australia’s previous July record of 92,754 in 2017.

The figures indicate the market is continuing to recover from the supply shortages caused by COVID plant shutdowns, shortages of microprocessors, as well as bottlenecks in logistics and shipping globally.

“During the past twelve months the issue has been one of securing supply for consumers, however as these pressures ease, we are starting to see a return to more stable market conditions,” FCAI Chief Executive Tony Weber told the AfMA. “Many of these vehicles were ordered several months ago, so it is important to monitor the broader economic conditions through 2023 and their impact on private and business demand.”

The SUV market in Australia led the increase, rising by 12,299 vehicles (27.5%), while passenger vehicle sales were up by 1,108 (6.9%) over the same month last year, according to the AfMA. In contrast, the light commercial market is down by 795 vehicle sales (-4.0%), and the heavy commercial vehicle market decreased by 214 vehicle sales (-5.8%) versus July 2022.

According to Webber, sales in the passenger vehicle sales, at a historically low level, have transitioned into the SUV category, which represented nearly 60% of vehicle sales in July, the AfMA reported.

However, “contrary to widely held opinion, not all SUVs are large vehicles, as 75%of SUV sales are in the medium, small and light categories,” Webber pointed out.

Sales of zero and low-emission vehicles continued to grow with 17.9% being battery electric, hybrid or plug-in hybrid models. Battery electric vehicles accounted for 7% of July sales.

EU New-Car Registrations Increase Nearly 18%

In the first six months of 2023, new car registrations in the European Union (EU) rose significantly:17.9%, an increase to 5.4 million units, according to recent figures from the European Automobile Manufacturers' Association (ACEA).

The EU’s four largest markets experienced substantial growth: Spain, 24%; Italy, 22.8%; France, 15.3%; and Germany, 12.8%.

Despite the sales growth, the ACEA pointed out, cumulative volumes are 21% lower compared to 2019.

In June alone, the EU car market grew by 17.8% to 1 million registered units, the ACEA reported. This growth can be attributed to the region’s rebound from a low comparison base last year, primarily driven by vehicle component shortages.

Electric vehicles continue to rise in sales popularity, the ACEA figures indicate. In June, the battery-electric car market share grew impressively, from 10.7% to 15.1%, overtaking diesel share for the first time. Hybrid-electric cars represented 24.3% of the market, the second-most popular choice among new car buyers. However, ICE-powered vehicles continued to lead the market, with a 36.3% share.