Vehicle damage is very doable.
- Make blank "vehicle" to hold damageable parts
- Mount damageable areas to nodes on the blank
- Run a collision detection script
- Replace dts for collided area with "damaged" version
The biggest problem with it would be the collision script needing to run over top of the game. It'd be quite a resource hog, since if you space out the collision checks too far, weird things could happen with collided vehicles.