Is this Beompeoking Jaepeo, AKA Bumper King Zapper (2004)...?
Bumper King Zapper is a 3D animation series about bumper car battles of the future.
I'm not familiar with this series myself, and can't find much information about the plot online. Some episodes have been uploaded to YouTube, but the audio is in Korean with no subtitles, and YouTube's auto-generated subtitles aren't much help. Judging by what's shown visually, though, it seems to broadly match your description.
The first episode begins in a large arena, where two competitors named Asura and Zapper -- their names are shown on-screen at around the 0:40 mark in the video below -- are driving battle vehicles around circular tracks and collecting icons of some sort. (These aren't toy cars, incidentally; the drivers are actually in them.) The two cars then face off in a head-to-head battle, and at one point, Asura projects ethereal tendrils that latch onto Zapper through his car. Asura ultimately wins the battle and Zapper's car explodes.
The scene then cuts to a young boy, who suddenly wakes up in his bedroom, apparently having dreamed all this.
Later in the episode, the boy meets up with some other kids, one of whom has a remote-controlled car.
Later still, the boy is in what looks like a junkyard, accompanied by a small yellow creature with purple, batwing-like ears. While looking around, the boy notices a small car that looks like the one Zapper was driving in the opening scene, and after picking it up, turns around to see Zapper standing a few feet away from him.
They talk for a bit, before the boy notices that Zapper is intangible and starts running away in fear. Zapper then takes on a more spectral appearance and telekinetically moves large objects in front of the boy, blocking his exit. Zapper has the boy cornered, and lunges towards him, but then the small yellow creature gets in the way, and Zapper ends up inside it, apparently possessing it.
The episode ends there, but that seems pretty close to your description.