If your cars actually got damaged to the pont where they wouldn't drive anymore, I don't think I'd ever finish a race late in the game.
The races get so long, traffic is extreme and the cars are way too fast to run an entire race without crashing.
If you want to have realistic damage, then you need to play a sim racing game, vice an arcadish one.
After the first car, I just raced the cars I'd won from the BL members. No real need to upgrade, because as stated above, the other will race to your cars ability, not theirs.