Who Do the Electronic Fences Enclose?
During the recently held 2025 China Electric Vehicle Hundred Person Forum, Liu Liguo, Senior Vice President of Li Auto, pointed out that the experience of users of range-extended electric vehicles (REEVs) in urban driving has become quite similar to that of pure electric vehicles (EVs). He suggested that REEVs should enjoy the same rights as pure EVs in urban environments and proposed that range-extended electric vehicles with a pure electric range of 150 kilometers be included under the management category of pure electric vehicles. Furthermore, he proposed implementing electronic fence technology to mandate the use of pure electric drive within certain areas.
In fact, the suggestion to classify REEVs alongside pure electric vehicles is not new. Years ago, when the pure electric range of REEVs was only 50 kilometers, experts had made similar recommendations. Today, with rapid advancements in battery technology, the pure electric range of REEVs and plug-in hybrid electric vehicles (PHEVs) has generally reached or exceeded 100 kilometers, eliminating technological barriers.
This raises the question: how feasible is it to categorize REEVs as pure electric vehicles? What challenges would this pose to urban automotive management systems? And in light of the trend towards equal rights for gasoline and electric vehicles, is such a measure still necessary? In the context of the transition from management based on vehicle sales to management based on usage, does this suggestion infringe upon consumer rights?
Some analysts believe that in addition to restrictions, automotive management should explore other viable options.
Technical Feasibility
From a technical standpoint, categorizing REEVs as pure electric vehicles is entirely feasible. Cui Dongshu, Secretary General of the Passenger Car Market Information Joint Conference of the China Automobile Dealers Association, stated in an interview that when the battery is sufficiently charged, REEVs can utilize electricity for driving just like pure electric vehicles and have a relatively long pure electric range. Li Auto indicated that with continuous improvements in battery and range extender technology, the electronic fence system for REEVs has become relatively mature, allowing for designated areas within specific cities where vehicles must switch to pure electric mode upon entry.
An engineer from a major automotive manufacturer noted, “The technical features of REEVs allow them to operate on both pure electric drive and fuel-powered generation; thus, there are no technical obstacles to categorizing them as pure electric vehicles.” However, the internal combustion engine and generator in REEVs do occupy space and weight, which can limit the vehicle’s range and performance. Cui Dongshu added that with ongoing advancements in battery technology and further cost reductions, the pure electric range of REEVs is expected to grow, providing more possibilities for their inclusion in the management of pure electric vehicles.
Management Challenges
Despite the technical feasibility of classifying REEVs as pure electric vehicles, implementing this proposal is not straightforward. Cui Dongshu noted that doing so would present challenges to the urban automotive management system. Currently, there is a significant difference in the management of pure electric and gasoline vehicles in China, including aspects such as license plate composition, restrictions on use, purchase limitations, and subsidies. If REEVs were classified as pure electric vehicles, these management policies would need to be adjusted accordingly.
For example, in Beijing, only pure electric vehicles can enjoy new energy vehicle quotas and are exempt from restrictions based on license plate numbers. If REEVs were classified as pure electric vehicles, they would also gain access to these quotas and exemptions, potentially disrupting the existing management system for new energy vehicles.
Moreover, the necessity of classifying REEVs as pure electric vehicles amidst the growing trend of equal rights for gasoline and electric vehicles has sparked widespread debate. On one hand, when the battery charge is low, REEVs must activate the range extender, resulting in emissions and noise; on the other hand, REEVs generally have higher prices compared to similar gasoline and pure electric vehicles, which may seem unfair to some consumers. However, from another perspective, categorizing REEVs as pure electric vehicles could help promote the development of the new energy vehicle industry, encouraging more consumers to purchase these vehicles and expanding the market.
Additionally, the State Council’s guidelines on constructing a high-quality charging infrastructure system require that by 2030, the proportion of charging spaces in urban commercial parking lots should exceed the ownership of electric vehicles. Mandating REEVs to switch to pure electric mode in specific urban areas could lead to a shortage of charging facilities, exacerbating the challenges of urban charging.
Wang Yunpeng, an academician of the Chinese Academy of Engineering, emphasized that “electronic fences are essentially tools for urban governance that need to balance environmental goals with user experience.” He pointed out that if a mandatory switch to pure electric mode is enforced, the density of charging facilities in the area must not be less than one per square kilometer. In central urban areas, achieving this density is clearly unrealistic.
From Restrictions to Guidance
During the National People’s Congress, the automotive industry has heatedly discussed the shift from management based on vehicle sales to management based on usage, offering a new perspective on incorporating REEVs into the management of pure electric vehicles. Cui Dongshu stated, “The transition to usage management is an inevitable trend in the automotive industry.” As the number of vehicles continues to rise and urbanization accelerates, the importance of vehicle usage management becomes increasingly apparent. This shift not only improves traffic efficiency and management levels but also promotes the sustainable development of the automotive industry.
In this transition, would incorporating REEVs into the management of pure electric vehicles increase or reduce consumer rights? Cui believes that from the consumer’s perspective, this could lead to increased benefits. On one hand, it could allow consumers to enjoy more incentives associated with new energy vehicles, such as purchase subsidies, free parking, and free charging. On the other hand, it may provide consumers with greater convenience in terms of restrictions on use and purchasing.
However, some industry insiders argue that classifying REEVs as pure electric vehicles could impact consumer rights, potentially increasing the cost of ownership and affecting usage habits. An insider noted that the need for the range extender to activate when battery levels are low might lead to discomfort for drivers.
In the transition from sales management to usage management, aside from including REEVs under pure electric vehicle management, are there other viable methods? Cui asserted that the shift does not imply that the only path is to categorize REEVs as pure electric vehicles. Enhancing urban traffic planning and management systems can improve traffic efficiency and management standards. Promoting advancements in new energy vehicle technologies can also enhance vehicle performance and quality, encouraging consumers to purchase and use new energy vehicles. Furthermore, strengthening regulation of vehicle usage, including enhancing traffic enforcement, raising safety awareness, and promoting intelligent traffic systems, can improve the efficiency and level of vehicle usage management.
“In summary, the transition from sales management to usage management in the automotive industry is a complex and long-term process that requires joint efforts and cooperation from the government, enterprises, and consumers,” said Cui Dongshu.
Zhao Fuquan, Dean of the Automotive Industry and Technology Strategy Research Institute at Tsinghua University, suggested that “electronic fences are a governance tool, not an end goal.” He advocated for drawing lessons from Shenzhen’s VOCs management experience by encouraging vehicle manufacturers to upgrade technology through subsidies rather than imposing strict limitations.
Ultimately, the question remains: who do electronic fences actually enclose? It fundamentally represents the clash between technological innovation and urban governance. As REEVs leverage their “anxiety-free” advantages to reshape market dynamics, policymakers must find a balance between environmental objectives, consumer rights, and industry development. As Porsche China President Pan Licheng stated, “The pace of change in the Chinese market far exceeds expectations; any policy should serve as a testing ground for innovation rather than a constraint on technology.” Perhaps more important than establishing electronic fences is creating a regulatory framework that encourages technological inclusivity and respects consumer choice.
