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I would look for that setting.
Go to your performance settings and set "Maximum visible cars" to OFF
For reference I'm on gig fiber line hard wired with cat 8 and it was never like that before the last major update
It was recently added on 12/31/2023 with V1.5.5.0 patch.
V1.5.3.5 -> V1.5.5.0 CHANGELOG
GENERAL
• Added option to limit maximum number of visible vehicles
Regardless of when the option was added, it sounded like this might have been be the issue since the OP called out the number of cars that would fade away.
On the first release, most of the cars in front would disappear and the ones in the mirror/behind would remain. They recently changed it to prioritise the cars in front to be shown. It probably still needs tweaking?
single player, right well forget any lag spikes then there is a setting though which changes the distance when cars pop into view ( draw distance) , i usually set this to max even if it means on some games having to compensate other gfx settings like shadows lighting scaling or whatever