(Yicai Global) Oct. 26 -- Shanghai is ratcheting up its already taut restrictions on vehicles with outside license plates to untangle its ubiquitous traffic snarls, a practice that will also benefit new energy vehicle sales, since such curbs are not binding on NEVs, analysts said.

The stratospheric costs of the eastern Chinese megacity’s new vehicle license plate registrations are set to soar even higher next year, Cailian Press reported, citing Song Tingting with Shenwan Hongyuan Securities.

Shanghai’s new limits on vehicles licensed elsewhere are expected to further underscore the advantages of NEVs, CSC Financial stated, predicting the new rules will raise their sales to more than 100,000 units a year. The many owners of autos tagged in other provinces and cities who live and operate them in Shanghai will likely switch to NEVs, which will give a further fillip to their sales.

The eastern financial hub will also extend its ban on non-local vehicles driving on its elevated expressways to 13 hours a day from the current eight hours on Nov. 2, the Shanghai Public Security Bureau announced on Oct. 24. Such autos will likewise be barred from ground-level streets in the downtown area from 7.00 a.m. to 10.00 a.m. and from 4.00 p.m. to 7.00 p.m. on weekdays, starting in May.

Shanghai has 4.16 million registered vehicles, and around 1.7 million with other jurisdictions’ plates often run in the city, data show.

Local vehicle tags, which are only available by a heavily oversubscribed lottery, go at auction for about CNY90,000 (USD13,455) apiece, but buyers of plug-in hybrid electric or battery electric vehicles get theirs gratis and without the wait.

Editor: Ben Armour