Thinking Particles soft body ripping RnD. The last 2 setups have obvious intersection issues but the cloth is only one face thick so it is close to impossible to catch a collision before it is inside the collision geo. Thicker tears would probably solve that. The ripping itself is done procedurally in TP with fragmenter set to make X amount of fragments (in the thousands).
Some scale issues in the tracked shots and there is derfinitely room for shader improvement but the cars are ready-made Evermotion meshes I merged and hit render pretty much.