Sega Rally Championship

Sega Rally Championship (arcade)  1994

First game to feature driving on different surfaces (including asphalt, gravel, mud and puddles), first animated crowd in 3D sport game

Arcade system: Sega Model 2A CRX

Gameplay video

Magazine review - Computer and videogames (1995)

Magazine review - Computer and videogames (1996)

Trivia:
1) Featured cooperative gameplay alongside the usual competitive multiplayer.

2) Watch Daytona USA (1993) for more racing games.

3) Emulated in: Model 2 Emulator