The Australian new vehicle market continued to outperform other economic indicators during 2010 to post its second highest annual sales figure and record over 1m units for the third time.

Official VFACTS data released by the Federal Chamber of Automotive Industries (FCAI) showed that 1,035,574 passenger cars, SUVs and commercial vehicles were sold in the calendar year 2010 (up 10.5% or 98,246 vehicles compared to 2009).

"This is an exceptional outcome and is the second highest result on record and only the third time ever that the market exceeded more than 1m sales," FCAI CEO Andrew McKellar said.

"The result is very encouraging given all the challenges of the year - the prospect of higher interest rates, political uncertainty and the withdrawal of market stimulus.

"We expect 2011 will be a year of consolidation with the prospect of further improvement on the growth achieved last year." he said.

Toyota was the best performing brand in 2010 for the eighth year in a row with a market share of 20.7%, ahead of Holden with 12.8% and Ford with 9.2%.

The most popular vehicle model, for the 15th year in a row, was the Holden Commodore; ahead of the Toyota Corolla and Hilux.

Toyota sales and marketing chief David Buttner said Toyota was Australia's leading automotive exporter with Camry, Hybrid Camry and Aurion cars shipped to over 20 destinations.

He said production in Melbourne increased 23.6% to almost 120,000 cars in 2010. Of these, almost 83,000 were exported, mainly to the Middle East - an increase of over 30% year on year.

"We are also investing in new-generation engines to be produced in Australia that are more fuel efficient, produce fewer carbon emissions and provide significant opportunities for new exports," Buttner added.