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As global car giants race for an advantage in the world's largest car market, the Shanghai Commission of Economy and Information Technology awarded the two licences for BMW's 7 Series sedans on Monday, the regulator said.
Since the city started issuing the testing permits in March, local state-owned automaker SAIC and Chinese electric vehicle startup NIO have logged more than 6,000 kilometres (3,728 miles) of driving without incidents, the commission said.
But the licences do not give automakers access to all of Shanghai's chaotic streets. Instead they have a 5.6-kilometre stretch of road to drive up and down, according to state news agency Xinhua.