Action at El Alamein from 3 July 1942

Rommel found that the Eighth Army under General Auchinleck's command, would not panic and run when confronted with infiltration tactics. Rommel hoped that on 3 July 1942, his forces might be able to achieve some success against the British. The 90th Light Division was allowed to dig in where they were and not try to attack. The remnants of the German Africa Corps were ordered to push their 26 running tanks to the east to isolate the South Africans. The British were in somewhat better condition, because the 1st Armoured Division still had 100 running tanks. Rommel still wanted the Italian XX Corps to "deal with the Qattara Box". Auchinleck's plan was for XXX Corps to sit in the coastal region and be ready to fight any attack. XIII Corps would turn the enemy flank and go after their rear areas from Deir el Shein.

On the morning of 3 July, the Africa Corps was looking for a weak spot to attack when they found the 1st Armoured Division. The British tanks moved into hull-down positions, which were not the usual British mode of fighting. The armored units fought all day long on the Ruweisat Ridge. Rommel was pushing the Africa Corps to push past the South African Division on the south side, but they only covered a short distance and stopped.
The 1st Armoured Division was not able to make the move around the enemy flank, but the New Zealand Division achieved a great victory. The Italian Ariete armored division moved out from Alam Nayil, between the Qattara Box and the Ruweisat Ridge. They had a brief encounter with the 4th Armoured Brigade and then were fired on by four New Zealand field batteries.
The Italians reacted so strongly to the artillery fire that 4th New Zealand Brigade attacked "from the south". The 19th New Zealand Battalion was in the lead. Their carrier platoon led an attack with fixed bayonets and captured an outlying Italian group. They then made a "systematic attack" on a larger group of Italians. They Italian morale must have collapsed, as some 350 men surrendered and about 44 medium and field guns were captured. They also captured a large number of vehicles. The New Zealand Division was commanded by Major-General Inglis on a temporary basis. With the Italians being in such serious trouble, he ordered Howard Kippenberger to attack with his 5th Brigade at El Mreir. The Brescia Division was located at El Mreir, and they fired on the 5th Brigade, which eventually dug in where they had arrived.
By the end of 3 July, Rommel had to admit that his army could go no further in its present state. He decided that they needed time to regroup and recover "for at least a fortnight". His army was in a sad state with divisions being down to 1200 to 1300 men. He only had about 36 German tanks still running. They also were "short of ammunition" and we would imagine that they were also short of supplies. We are very familiar with Friedrich von Mellinthin and his book Panzer Battles. On 4 July 1942, he was a staff officer with Rommel. In his book, von Mellinthin called the German-Italian situation "perilous". This is based on the account in Vol.III of the Australian Official History.