Annular thermoelectric generators (ATEGs), matched well with the exhaust pipe in geometry, are proposed to recover the heat from automobiles. A theoretical model was constructed to assess the performance of automotive exhaust ATEGs (AEATEGs), where a finite element method was used to incorporate the temperature variation and temperature-dependent properties. The local pressure drop as to the change of cross-section area and shape was considered. Performance comparison with commonly used automotive exhaust flat-plate thermoelectric generators (AEFTEGs) was conducted. Also, the effects of flow arrangement and operating parameters were clarified. Results show that the performance of AEATEGs outperforms AEFTEGs, with the net power on average 1.1% higher. With increasing cooling medium flow rate, the net power increases until attaining a maximum and decreases afterwards. A flow rate of 0.05 kg/s is preferred for the compromise of coolant temperature rise and tank volume. In light of a large temperature drop from exhaust to generators, a simple strategy, inserting a hollow cylinder into heat exchanger, was developed and its effectiveness was evaluated. The maximum enhancement in net power of 214.0% is exhibited, but which reduces notably with increasing exhaust flow rate. For gasoline automobiles, a cylinder with dimensionless diameter of 0.8 is recommended.