The application of state-of-art thermoelectric generator (TEG) in automotive engine has potential to reduce more than 2% fuel consumption and hence the CO2 emissions. This figure is expected to be increased to 5%~10% in the near future when new thermoelectric material with higher properties is fabricated. However, in order to maximize the TEG output power, there are a few issues need to be considered in the design stage such as the number of modules, the connection of modules, the geometry of the thermoelectric module, the DC-DC converter circuit, the geometry of the heat exchanger especially the hot side heat exchanger etc. These issues can only be investigated via a proper TEG model. The authors introduced four ways of TEG modelling which in the increasing complexity order are MATLB function based model, MATLAB Simscape based Simulink model, GT-power TEG model and CFD STAR-CCM+ model. Both Simscape model and GT-Power model have intrinsic dynamic model performance. MATLAB function based model and STAR-CCM+ model can be developed to have only steady state performance or to include dynamic performance. Steady state model can be used in quick assessment of TEG performance and for initial design optimization. However, only dynamic model can give the accurate prediction of TEG output during engine transient cycles. The procedures of the development of these four TEG model types are given in this paper respectively. STAR-CCM+ model has the most difficulties in the development of 3D heat exchanger model and 3D thermoelectric model. It also has the most computational cost. GT-power model has difficulties in how to setup the hot side heat exchanger configurations. These four models are validated using TEG test data on a 2l gasoline main exhaust path and a heavy duty diesel engine EGR path. The route for choosing the thermal resistance of the heat exchanger, the fill factor, aspect ratio, leg length and number of couples of the thermoelectric modules has been investigated using MATLAB function based steady state model. Then, three design cases were selected in the prediction of TEG output during an engine transient cycle using the validated dynamic TEG model. This simulation results in turn to prove that the design guidance is correct.