BeamNG has tire deformation physics that behave very realistically but the sidewall deformation I have noticed is not very realistic. At the moment when the tire compresses the mesh follows the beams compression directly and the sidewall simply shrinks where the compression is. In real life the sidewall would move out of the way, getting wider where compression occurs. I think I have a way around it without a performance hit, although I'm not sure if it is possible within the game engine. If one were to make a second tire mesh, or a modifier that stretches the sidewall outward when the tire is deformed, the mesh could be applied to the deformed area only and widen the sidewall in that area. I think it could have a minimal performance hit and make the tire deformation a bit more realistic. I'm aware I'm terrible at explaining things so if you don't understand I'll try to find a way to explain the idea better.
A secondary mesh for every single tire in the game would increase the game file size by a lot, only for 1 small visual effect that would definitely have unwanted side effects, not worth it imo.
Okay, that makes sense. Although if there could be a bit of code that bulges the sidewall procedurally somehow that might work. May still have weird side effects though.