Our chariots were strong,
Our horses were well matched,
And with four steeds [for each], sleek and large,
We yoked and proceeded to the east. —The Shijing (Che Gong)
War Chariots are the initial ranged unit for most Chinese factions, Compared to horsemen, they are quite slow but unlike archer units, they can protect themselves fairly well. The best use for them is like most fast skirmish units - roll them into action, peppering the foe with arrows, then run away. Chariots are fairly costly, however, compared to Horsemen, but they are strong enough to suffer one or two blows.
For this reason, War Chariots should not be used en masse unlike most other cavalry, but should be used instead to escort units. Build four or five chariots and use them to attack your foes in concert with your infantry, by using the War Chariots to provide a missile screen to weaken melee infantry, then allow your other units to close in for the kill. However, don't rely on too many of them - once your opponents start building Barracks to access Crossbow Infantry, you can be assured of facing some serious threats. Chariots are still useful as heavy cavalry units, however, so it is better to use them against infantry, particularly light ones with weak weapons unable to resist melee attacks.
War Chariots are in effect the Medium Chariots of Rise of Kings: Warbirth.