The 22-meter-long, 7.8-meter-wide and 4.8-meter-high TEB-1 can carry up to 300 passengers over the top of cars and let traffic pass underneath it.
This week, it underwent its first road test in north China's Hebei Province.The TEB has already attracted interest from governments in Brazil, France, India and Indonesia, it has been claimed.
The idea is that passengers sit far above other vehicles on the road, allowing cars to pass underneath.
In a model of the vehicle, it appears to run on a set of fixed rails embedded on the road.
It means the vehicle is more like a cross between a tram and a bus.
Engineers hope the design will increase the availability of the road space, and cause fewer traffic jams than regular buses.
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