New-Car Registrations Accelerate More Than 10% Through July, With Electrics Taking a Quarter of the Market

Portugal's car market is having its strongest year in a generation. Between January and July, dealers registered 180,423 new vehicles, a 10.2% increase on the same period in 2025, according to figures from the Associação Automóvel de Portugal (Automobile Association of Portugal, or ACAP). July alone accounted for 22,480 registrations, up 8.6% year on year — evidence that the momentum built over the spring has carried into the summer.

The bulk of the demand is for passenger cars. Of the vehicles registered in the first seven months, 155,237 were light passenger models, 19,850 were light commercial vehicles and 5,336 were heavy vehicles. ACAP notes that the first half of the year delivered the best sales figures of the century so far, with more than 158,000 units registered by the end of June.

Just as striking as the volume is the shift in what people are buying. Among new light passenger cars registered from January to July, 74.9% ran on alternative energy — chiefly electric and hybrid models — and fully electric cars made up 26% of the total. That means roughly one in four new cars leaving Portuguese showrooms this year is a pure electric vehicle, a proportion that would have seemed improbable only a few years ago and that reflects both wider model availability and the pull of lower running costs.

A significant share of the growth, ACAP points out, has been driven by the car-rental sector, which renews its fleets in bulk and inflates the registration figures ahead of the tourist season. That caveat matters: strong headline numbers do not necessarily mean private buyers are flocking to dealerships at the same pace. The association has also cautioned that even this recovery is "insufficient" against the scale of the challenge, because Portugal's vehicle fleet is old and needs faster renewal to improve safety and cut emissions.

Still, the direction of travel is unmistakable. After years in which sales were held back by supply shortages and squeezed household budgets, the market is climbing back towards what the industry considers normal levels, and it is doing so with a decisively greener mix of vehicles than before.

For expats, the trends carry a few practical signals. If you are in the market for a car, the surge in electric and hybrid registrations means a broader choice of models and a maturing charging network, though it is worth checking incentives and the tax treatment of company and imported vehicles before committing. Heavy fleet-buying by rental firms also feeds a steady stream of nearly-new cars into the used market months later, which can be good news for anyone who prefers to buy second-hand. And with the national fleet still ageing, the eventual pressure to modernise — through emissions rules, low-emission zones or scrappage-style measures — is a factor worth weighing when deciding between an older bargain and a cleaner, costlier new model.