In my Opinion its the wrong Z-Buffer effect like Superku said.
Add this material at your Car and the enviroment to test it out wheater its really the Z Buffer...

Material: (A6 FFP Effect)
Code:
function mtl_vegetation_init
{
	vec_set(mtl.emissive_blue,mat_model.emissive_blue);
	vec_set(mtl.ambient_blue,mat_model.ambient_blue);
	vec_set(mtl.diffuse_blue,mat_model.diffuse_blue);
	vec_set(mtl.specular_blue,mat_model.specular_blue);
	mtl.power=mat_model.power;
	mtl.albedo=mat_model.albedo;
	mtl.skill1=pixel_for_vec(vector(128,0,0),0,8888); // the first value in the vector is the threshold
}

material mtl_vegetation
{
	event=mtl_vegetation_init;
	effect=
	"
	texture entSkin1;
	dword mtlSkill1;

	technique vegetation
	{
		pass p0
		{
			Texture[0]=<entSkin1>;
			ZWriteEnable=True;
			AlphaBlendEnable=False;
			AlphaTestEnable=True;
			AlphaRef=<mtlSkill1>;
			AlphaFunc=Greater;
			CullMode=CCW; // CCW or None

			ColorArg1[0]=Texture;
			ColorOp[0]=Modulate2X;
			ColorArg2[0]=Diffuse;
		}
	}
	technique fallback{pass p0{}}
	";
}

action vegetation
{
	my.transparent=off;
	my.flare=off;
	my.material=mtl_vegetation;
}


Add the lines from "Action Vegetation" into the action of your car / enviroment.

Hope this helps.

cYa Sebastian

Tutorials:
[Blender]Terrain creation ENG/GER
[Blender]Low Poly Tree Modeling
[GIMP]Create a Texture for Terrains
CLICK HERE