In most of China, buying a car and registering it are the same transaction. In about a dozen cities they are not: the car is easy and the plate is the scarce thing. Understanding which city uses which mechanism explains a great deal about what sells there.
Why the caps exist
Shanghai went first. From 1994 the city auctioned a monthly quota of private car registration certificates, making it the first Chinese city to ration registrations by price rather than by rule. The stated purpose was congestion; the effect was also fiscal, since the auction generates revenue directly.
Beijing took the opposite approach in 2011, allocating a fixed annual quota by free lottery. The trigger was the same — traffic — with air quality added as the second justification during the 2010s.
Since then Guangzhou, Shenzhen, Tianjin, Hangzhou, Hainan and several others have adopted quota systems, mostly hybrids that split the quota between a lottery portion and an auction portion. The International Council on Clean Transportation's 2023 review of city policies records Guangzhou, Shenzhen, Tianjin and Hangzhou all using that hybrid design.
The vocabulary you will hear: 摇号 (yáohào, "yaow-HOW") is the lottery — literally "shake the number"; 拍牌 (pāipái, "pie-PIE") is the plate auction; 指标 (zhǐbiāo, "JR-byaow") is the quota certificate itself, which is what is actually being allocated. You win a 指标, then buy a car, then register it.
Beijing: the lottery, then the household score
Beijing's system started as a pure lottery and is no longer one.
Under the original design, any qualified resident entered a draw. Odds collapsed as applicants accumulated. In the June 2018 round, Sixth Tone reported 6,333 plates available and odds of about 1 in 2,031 for a new applicant, with nearly three million people in the pool. Battery-electric cars were handled by a separate queue rather than a draw — first come, first served — and by January 2019 China Daily reported the expected wait on that queue had stretched to roughly eight years.
From 2021 Beijing rewrote the rules around households rather than individuals. A family with no car can apply jointly; a formula scores the household on the number of members and how long each has been queuing, and higher-scoring, longer-waiting, car-free families are served first. Individuals still apply, but with a smaller share of the quota.
The recent numbers:
- 2025: 100,000 passenger-car quotas, of which 80,000 were for new energy vehicles, announced in January 2025.
- 2026: the Beijing Municipal Commission of Transport announced on 15 February 2026 an extra 80,000 NEV quotas, taking the year's total to 180,000. Of the additional quotas, 60,000 go to car-free families and 20,000 to individuals; distribution began on 26 May 2026 and they apply to pure electric vehicles only.
For foreign residents, Beijing publishes its own rules. You need a valid Chinese driving licence, at least a year of registered residence in Beijing, and a residence permit, permanent residence card or visa valid for at least one year, and you must not already own a Beijing-registered passenger car. Applications open 1 January to 8 March (results 9 April) and 1 August to 8 October (results 9 November). You cannot apply for an ordinary and an NEV quota at the same time.
We could not verify a current published win rate for the ordinary Beijing lottery from a primary municipal source, and the household-score system makes a single odds number less meaningful than it was in 2018. Where a figure matters to you, check the Beijing Municipal Commission of Transport's own release for the round in question.
Shanghai: the monthly auction
Shanghai runs a sealed-bid auction, held monthly and organised by the Shanghai International Commodity Auction Co. Bidders enter a price within a published window; the clearing price is set by the quota.
The May 2023 round is a well-documented example: 13,214 plates on offer, 113,722 bidders, a lowest winning bid of ¥92,400, an average winning bid of ¥92,547, and a success rate of 11.6%. Winning bids have generally sat in the ¥90,000 region in recent years — routinely more than the price of a small electric car.
Shanghai's NEV rule is what makes the city's market look the way it does. Battery-electric cars have been issued a free green plate rather than requiring an auction win, and Shanghai confirmed the continuation of free plates for battery-electric vehicles for 2024 and again for 2025. Plug-in hybrids lost that eligibility: the city announced in February 2021 that from 1 January 2023 plug-in hybrids and extended-range vehicles would no longer get a free plate. The effect was immediate and large, with local plug-in hybrid sales falling sharply in 2023 as buyers switched to battery-electric cars or paid to bid.
The other capped cities
- Guangzhou and Shenzhen split their quota between a free lottery and an auction, with separate, easier allocation for new energy vehicles.
- Tianjin and Hangzhou use the same hybrid pattern. Tianjin released 30,000 quotas specifically for car-free households in 2024; Hangzhou allows people who have applied unsuccessfully at least 48 times to receive an alternative quota.
- Hainan province, unusually, applies control province-wide rather than in one city, with a design that combines auction and lottery.
The 2024–2026 loosening
The direction of policy has changed. On 16 March 2025 the General Office of the CPC Central Committee and the General Office of the State Council issued a plan on boosting consumption that told cities to move car policy from purchase-based controls to usage-based regulation, and to make sure that families who have waited a long time without success can get a car. Cities have responded mainly by adding quota — Beijing's extra 80,000 NEV certificates for 2026 being the largest single example — and by widening eligibility for car-free households rather than by abolishing the caps.
Nothing announced so far removes a quota system entirely in a first-tier city. Read announcements carefully: "relaxing restrictions" in Chinese policy language has usually meant more quota, not no quota.
Out-of-town plates and 限行
Because plates are scarce in the capped cities and free elsewhere, drivers register cars in neighbouring provinces. Cities restrict those cars — 外地车 (wàidìchē, "why-DEE-chuh"), literally "outside-place cars".
Beijing operates two overlapping restrictions. A rotating tail-number ban keeps one pair of final plate digits off the roads inside the Fifth Ring Road each weekday from 07:00 to 20:00, with the pairings rotated quarterly; plates ending in a letter count as ending in zero. Separately, non-Beijing plates need a permit to enter the city proper and face tighter limits.
Shanghai restricts by road rather than by digit. The Shanghai Public Security Bureau announced on 24 October 2020 that from 2 November 2020 non-Shanghai plates would be barred from most elevated roads on working days from 07:00 to 20:00 — extended from the previous eight-hour window — and ground-level restrictions on the inner ring followed from the first working day after the 2021 May Day holiday.
Other cities including Hangzhou and Chengdu run their own tail-number schemes with their own hours and boundaries. In several of them, a green NEV plate is exempt. Before driving into an unfamiliar Chinese city, check that city's current 限行 (xiànxíng, "shyen-SHING") — driving restriction — notice; the rules are municipal, they change, and the cameras do not forgive.