Electric vehicles tend to be a great mobility option for the potential benefits in energy consumption and emission reduction. On‐way charging (OWC) has been recognized to be a promising solution to extend driving range for electric vehicles. Location of the electrification road (ER) is a critical issue for future urban traffic management to accommodate the new mobility option. This paper proposes a mathematical program with equilibrium constraint (MPEC) approach to solve this problem, which minimizes the total travel time with a limited construction budget. To describe the drivers’ routing choice, a path‐constrained network equilibrium model is proposed to minimize their travel time and prevent running out of charge. We develop a modified active set algorithm to solve the MPEC model. Numerical experiments are presented to demonstrate the performance of the model and the solution algorithm and analyze the impact of charging efficiency, battery size, and comfortable range.