These type of otaku-owned car are called Itasha 痛車?, literally "painful car" (painfully embarrassing / painful for the wallet) and started with decoration of cars in the 80s when Japan experienced a lot of growth and many wealthy people started importing many luxury cars. This decoration only really consisted of plushies, stickers and non-permanent features.
According to Wikipedia, fully-fledged Itasha only really started being seen in the 21st century - when internet culture gave the anime industry a large growth sprurt - in advertising, greater fan communities and distribution.
Expert from Itasha article, Otaku USA Magazine, 2009
Most often, stickers are put on the hood and doors of the car and then airbrushed. People who think, "It's kind of embarrassing, but I really want to ride in an itasha! ... But I'd have to hide it from my family and at my job. [..] can quickly take the design off by attaching and detaching magnetic stickers.
Although printing cutting sheets of personal favorite characters and putting them on the car is a popular method, people who are really devoted will commission a specialist to airbrush their designs.
This article mentions a few owners with itasha cars from 2002.
- In 2007, the first Autosalone (itasha convention) was held.
- June 2008, Aoshima Bunka Kyozai launched "ITASHA" as one of the first offically licensed Itasha.
It's not a purely-japanese phenomenon either, there are itasha to be seen in Malaysia , Taiwan and the Philippines too. It hasn't become overly popular in the West just yet however.