Automated vehicles (AVs) are believed to have great potential to improve the traffic capacity and efficiency of the current transport systems. Despite positive findings of the impact of AVs on traffic flow and potential road capacity increase for highways, few studies have been performed regarding the impact of AVs on urban roads. Moreover, studies considering traffic volume increase with a mixture of AVs and human-driven vehicles (HDVs) have rarely been conducted. Therefore, this study investigated the impact of gradual increments of AV penetration and traffic volume on urban roads. The study adopted a microsimulation approach using VISSIM with a Wiedmann 74 model for car-following behavior. Parameters for AVs were set at the SAE level 4 of automation. A real road network was chosen for the simulation having 13 intersections in a total distance of 4.5 km. The road network had various numbers of lanes from a single lane to five lanes in one direction. The network consists of a main arterial road and a parallel road serving nearby commercial and residential blocks. In total, 36 scenarios were investigated by a combination of AV penetrations and an increase in traffic volumes. The study found that, as AV penetration increased, traffic flow also improved, with a reduction of the average delay time of up to 31%. Also, as expected, links with three or four lanes had a more significant impact on the delay. In terms of road capacity increase, when the penetration of AVs was saturated at 100%, the road network could accommodate 40% more traffic.