Unfortunately, I found out that this is a design choice. The game has some sort of rubberband difficulty that is all over the place. One race can be easy and then the next seemingly impossible, no matter what level you are at.
Tip: Try restarting the game, it helps sometimes.
Anyhow, this broken gameplay & AI design is prevalent throughout the game and it's what made me sell the game. Even with a maxed out car you will be outrun by cars in the very first races, which makes takes away any feeling of progress and makes leveling up the racing cars a headache.
[Edit - Admin.] They completely ruined was what otherwise a really really cool racing game.