I vaguely remember a movie where people and autos in a town get cocooned/covered in silk in '80s/'90s.
Was there such a movie?
It is slightly earlier (1977) but in Kingdom of the Spiders there are several shots of people and other items cocooned in spider silk. In fact
at the end when 'Rack' (William Shatner) looks outside the house the entire landscape is covered in spider webs. "To their surprise, the radio broadcast does not mention the attack; the outside world is oblivious to what happened. Hansen pries off the boards from one of the lodge's windows, and discovers the building, along with the entire town of Camp Verde, encased in spider silk cocoons."
Could it be Eight-legged Freaks (2002)?
Commonalities: Town gets plagued by mutant spiders. Cocooning /silk-covering of pretty much everything in the town ensues.
I hope this isn't an entirely off topic answer here, but your remembered movie may actually have been the news.
These are just a sample of the top search results, I'm sure this was happening in the 80s and 90s, too.
No people cocooned or harmed, as far as I know, but occasionally weather conditions are just right and spiders will absolutely blanket a large area.
Fitting neatly between Kingdom of the Spiders and Eight-Legged Freaks, as well right in the middle of the timeframe, is Arachnophobia (1990). I can’t find any screenshots showing a person, car, or town being cocooned in webbing in the film, but my recollection is that by the end of the film the webs were pretty well everywhere.
Not a Movie but the episode fits the description.
The X-Files Season 1 Episode 20 - Darkness Falls (1994)
Description from imdb.com
A group of loggers working in a remote forest unearths thousands of deadly insectlike creatures that paralyze and cocoon their victims. Scully, Mulder and a few others end up trapped there.
Couldn't find a good picture to link.
My instinct is Cocoon (1985) about a group of seniors affected by swimming with, well, Cocoons...