Investigation into the chaos of old new energy vehicles privately modifying range to "extend life": the urgent need of commercial vehicles fuels the gray market, with triple barriers trapping automakers from official upgrades

Every reporter | Sun Tongtong Every editor | Yu Tingting

“After driving ride-hailing for 5 years, the range has dropped from 300 kilometers to 140 kilometers; it’s even worse in winter, running the air conditioning I can’t complete three rides before needing to recharge. Replacing the original battery costs over 50,000 yuan, more than the current residual value of the entire vehicle; selling the used car, dealers only offer 30,000 yuan, I can’t even recover my costs.” At a ride-hailing parking lot in Tongzhou, Beijing, driver Master Li anxiously pointed to the “external battery” he installed in his car’s trunk, looking helpless and worried.

This is not an isolated case. Currently, the number of electric vehicles in China has surpassed 43 million, and the first batch of widely deployed ride-hailing and taxi vehicles are entering a period of rapid battery degradation. On one hand, there’s a dire situation of “half the value” for used cars and high replacement costs, while on the other, there’s a rigid demand for livelihoods dependent on driving, prompting many owners to take risks and opt for unauthorized installations of power batteries or range extenders to “extend the life” of their vehicles.

This painful reality has directly spawned a massive illegal modification gray market—online, attracting customers through short videos and social media, while offline, modification workshops handle the installations. From parts supply to after-sales service, a hidden one-stop service chain has already formed, becoming a blind spot that is difficult for regulators to reach.

“This type of illegal modification problem has long existed, rooted in the early development stage of electric vehicles, where manufacturers hardly considered the residual value of used cars and subsequent battery degradation issues during development and production. As things evolve, they typically progress from immature technology to maturity, but in this process, the plight of vehicle owners has been overlooked.” On March 26, Wang Zidong, a senior expert in the power battery industry, pointed out the industry’s core issues in an interview with the Daily Economic News.

“Batteries must undergo strict testing and calibration before they can be used, and unauthorized modifications cannot complete these processes, inevitably posing serious safety risks.” Wang Zidong repeatedly emphasized that he absolutely does not recommend users personally adding batteries or range extenders, and that to resolve the dilemma at its source, manufacturers need to improve battery quality and slow down degradation, while also paying attention to the establishment of a residual value system for used new energy vehicles.

“Urgent need under the wave of warranty expiration: the helpless choice of vehicle owners”

In 2026, the first batch of operational electric vehicles in China will officially face a large-scale “warranty expiration wave.” For drivers relying on their vehicles for income, “the car can still run, but the battery is retiring first” has become the most heart-wrenching reality.

Image source: Daily Economic News media library

Data reports show that under high usage intensity, the battery degradation rate of operational vehicles far exceeds that of private vehicles—private cars run about 10,000 to 20,000 kilometers per year, degrading about 10% to 15% over six years; whereas ride-hailing and delivery vehicles can run 80,000 to 100,000 kilometers a year, and the degradation could reach 30% to 40% in just 3 to 4 years. Some vehicles’ battery health may even drop below 60%, leading to a drastic reduction in range becoming the norm.

What further complicates matters for these vehicle owners is that most automakers explicitly exclude operational vehicles from their battery warranty policies. After warranty expiration, replacing an original battery can cost from 50,000 to 60,000 yuan, often exceeding the vehicle’s residual value; while replacing with a new vehicle, accounting for various costs, requires at least several hundred thousand yuan, which is undoubtedly an unbearable expense for drivers who rely on cash flow for profit.

“Installing additional batteries has become the only solution.” A supplier of battery modules for new energy vehicles revealed to reporters that their installation business now covers the entire country, with operational vehicle users accounting for over 80%. “The price per kilowatt-hour is about 800 yuan, starting at 20 kilowatt-hours, costing from 16,000 yuan, which is much cheaper than replacing batteries or buying new vehicles. Operational vehicles are the livelihood of drivers; frequent recharging delays order acceptance, extending range is a necessity, and many operational vehicle companies even seek our services for bulk modifications.”

The supplier admitted that this business was indeed unstandardized and unregulated in the past few years, lacking warranties and safety inspections, but as the number of out-of-warranty vehicles increases, market demand has surged. “Now we’re also moving towards standardization and warranties.” According to this supplier, although the market scale of the installation business is not as large as that of mass-production automakers, customized installations for operational vehicles have already formed stable revenue streams. “There’s no need to pursue large-scale production; as long as we precisely meet operational needs, we can survive, and demand is gradually increasing.”

Industry data shows that the demand for modifications of new energy vehicles has become an important growth driver in the overall modification market, accounting for about 35% of the total market size, with a relatively high proportion of illegal modifications, the vast majority of which are concentrated in the operational vehicle sector.

According to the Road Traffic Safety Law of the People’s Republic of China, unauthorized modifications to vehicle power structures and three power systems are classified as clear illegal modifications, which not only cannot pass specialized annual inspections for new energy vehicles but also face penalties such as warnings, fines, and orders to restore to original conditions; more critically, if an accident occurs, insurance companies may refuse claims, and all losses must be borne by the vehicle owner. However, in the face of the urgent need to “survive,” many vehicle owners and modification businesses choose to ignore this red line.

Lethal hazards: the “compliance” that misleads, the “mobile bomb” hidden in the trunk

“The batteries we install are all brand new high-quality cells, and they are insured by PICC (People’s Insurance Company of China), so they are definitely compliant; otherwise, the insurance company wouldn’t insure them.” In response to reporters’ concerns about illegal modifications, the aforementioned battery supplier spoke firmly, “Although regulations do not allow unauthorized modifications, users have practical needs, and as long as there’s insurance coverage, that’s enough for them.”

However, further investigation revealed that this is merely a marketing pitch. The PICC only insures the battery cell products themselves, not the modification behavior or the modified vehicles; if vehicle faults or accidents occur due to modifications, whether to pay claims still depends on the insurance company of the vehicle itself, and these types of claims are often directly denied.

“As long as there are changes to the three power systems, regardless of whether the original circuit has been altered, problems are likely to lead to denial of coverage.” A senior car insurance salesperson with 8 years of experience told reporters they had previously handled similar cases, “There was a vehicle owner who privately installed a range extender and then experienced a fire; after inspection, the insurance company found it was due to illegal modifications and denied the claim. The owner not only had to bear the loss of the vehicle being burned but also had to compensate for the damaged surrounding property.”

Even more frightening is that the safety hazards brought by illegal modifications go far beyond just “denial of coverage.” Many battery experts and vehicle developers interviewed by reporters universally indicated that unauthorized installations of batteries and range extenders carry three lethal hazards, amounting to a “mobile bomb,” which is also a key focus of repeated warnings from regulatory authorities.

The first hazard is the significantly increased risk of thermal runaway. Modified batteries lack the original manufacturer’s thermal management systems and protective structures, mostly using non-standard components, which greatly reduce heat dissipation and pressure resistance; while the fuel tanks of range extenders are often carelessly placed in the collision energy absorption zone of the trunk, making them prone to fuel leaks and electrical short circuits in the event of a rear-end collision, which can trigger a fire. In January 2025, a privately modified electric vehicle in Jinan, Shandong, caught fire due to short-circuited wiring, burning 17 motorcycles and several cars, causing severe property damage.

The second hazard is chaos in the electrical control system. Non-standard devices can interfere with the normal logic of the original Battery Management System (BMS), leading to issues such as overcharging and voltage fluctuations, which can easily cause battery cell swelling, leading to thermal runaway. More critically, these types of illegal modifications lack professional technical calibration and have no risk prevention measures, akin to “running naked” on the road.

The third hazard is damage to the vehicle structure. Additional installed batteries and range extenders increase the vehicle’s load, disrupting the original chassis tuning and weight balance, significantly lowering braking and handling stability, thereby increasing the risk of traffic accidents. Moreover, the illegal modification market is rife with counterfeit and inferior parts; most core components have not undergone compliant inspections, and their quality varies greatly; coupled with the fact that modification workshops often lack professional qualifications and operate without standardized processes, which further amplifies safety risks.

Faced with these hazards, the aforementioned supplier had a different explanation: “Adding external batteries is equivalent to giving the vehicle a ‘power bank’, which will not change the original three power systems; as long as proper protocol matching is done and high-voltage cables are connected in parallel, there won’t be any safety issues.” However, when questioned about the risks of rear-end collisions causing fires with batteries installed in the trunk, he had to admit that “there are indeed certain risks.”

The dilemma of breaking the deadlock: automakers unwilling to engage, policies are taking effect, when will the gray market exit?

On one side is the urgent need of vehicle owners, and on the other side is the deadly safety hazard. Why don’t automakers launch official battery installation packages to provide compliant solutions for vehicle owners? Several industry insiders analyzed for reporters that the core issue lies in three major barriers that are difficult to overcome.

The first is that the compliance and cost barriers are too high. Installing batteries or range extenders in older models requires retesting for collisions, recalibrating electrical control systems, and submitting vehicle announcements; the R&D investment for a single model exceeds 10 million yuan; moreover, modified vehicles are unlikely to meet current safety and environmental standards, and the cost-performance ratio is far lower than launching new vehicles.

The second is that the warranty and recycling system cannot bear the load. Modifications would completely disrupt the original manufacturer’s warranty rules, making it extremely difficult to determine liability in case of quality problems; additionally, the disposal costs for old batteries are relatively high, leaving companies with almost no profit margin, making them naturally reluctant to engage.

The third is a conflict with the product iteration logic of automakers. The core business model of automakers is new car sales, and official installations would lower the willingness of older car owners to replace their vehicles, which contradicts the direction of upgrading the new energy vehicle industry. “With new products released every year, technology and experiences are continually updated, so there’s no need to spend energy on ‘patching up’ old cars.” A marketing system manager from a well-known new energy vehicle company bluntly stated that the current national policy strongly advocates “trade-in for new,” with replacement costs significantly reduced compared to before, and the risks and impracticality of unauthorized modifications to older vehicles.

This manager believes that the current demand for range extension installations is merely a “transitional phase” in the industry’s development. With advancements in battery technology and continuous improvements in charging infrastructure, the anxiety over the range of new energy vehicles will no longer be a long-term pain point for users, and the demand for illegal modifications will likewise decrease.

Notably, 2026 is referred to as the “compliance year” for the automotive modification market in China. The General Office of the State Council has listed automotive modifications as a key emerging field for cultivation, and a tiered and categorized management policy and standards system is gradually being established, delineating a path toward transparency for the modification industry.

At the same time, new policy regulations are also gradually addressing the core dilemmas faced by vehicle owners. Following the introduction of new policies related to the recycling and utilization of power batteries for new energy vehicles, third-party formal institutions will be allowed to participate in battery maintenance, replacement, and remanufacturing, with remanufactured battery prices expected to drop significantly and come with formal warranties.

Many industry experts believe that as the battery recycling system continues to improve, official battery replacement services become widespread, the circulation mechanism for used new energy vehicles gets refined, and the natural retirement of operational vehicles occurs, the illegal market for range extension will gradually shrink. Moreover, as the policies for the automotive modification industry accelerate towards standardization, the increasing supply of compliant modification services will further squeeze the survival space for illegal modifications, pushing the industry toward a direction that is safe, compliant, and orderly.

However, in the gap between policy implementation and industry iteration, those illegal modified vehicles that are still “running naked” remain “mobile bombs” on the roads. How to accelerate the pace of breaking the deadlock, both to resolve the survival dilemmas of operational vehicle owners and to safeguard public safety, remains an urgent issue to address.