The Beijing municipal government said it will slash the new car registration quota by a third starting next year.
Currently, Beijing allocates 150,000 license plates for new cars every year, and that number will be reduced to 100,000 in 2018, according to a new regulation.
Beijing residents apply for new car license plates through a lottery-style bidding system. The system was introduced in 2011 with an aim to cut pollution and ease traffic jams in the Chinese capital.
Of the annual quota of 100,000, 60 percent are for new energy cars and the rest are for fossil-fuel vehicles. Beijing has registered a total of 137,800 electric cars.
The capital aims to control the total number of vehicles to around 6.3 million by the end of 2020.
From 2010 to 2016, the number of cars in Beijing grew by an annual average of 3.23 percent, while the length of roads only grew by 0.66 percent every year.
"Rapid growth of private cars has plunged the city in perennial congestion. It is necessary for the number of cars to be limited," said Xu Kangming, an expert on urban transport.
In order to improve traffic conditions, Beijing will increase spending on its public transit system. By 2020, Beijing's metro lines will total 900 kilometers, said Rong Jun, deputy director of Beijing Municipal Commission of Transport.
