According to the Yantai police, the incident took place at 7:20 a.m. local time (23:54 GMT on Sunday). Chinese authorities have identified perpetrator as the 45-year-old resident of Heilongjiang province.
"After failed attempts to stop the driver, police opened fire and shot the suspect," the statement said.
Local authorities have launched an immediate investigation into the incident. The motives of the perpetrator were reportedly unknown.