A year ago I was experimenting with damage on our car models. We managed to create a fairly simple way to damage our cars by defining 4 points on the front left, front right, rear left and rear right, that represent the damage on the car. When a car get damage at one of the points, we increase the radius and therefore the damage. Within this radius we calculate a sin/cos on the XYZ to represent dents and pull every vertex a bit toward the inside of car. This is fairly simple and can easily be implemented on the GPU as we did. Also because we have the radius, we can simply add an damage texture.
In the screenshot you can see the damage done to the Blastback of our game FUR. The damage is in the front right corner of the car, closest to the camera.