Lionel, it's mostly used for advertising. You can make it look like your car is painted in very detailed graphics...but they are simply printed onto vinyl, and then the vinyl is stretched over the entire car, boat, etc. I am sure you have seen it, but just did not realize it is vinyl. Even race cars do it to save having to paint every time they "rub" on the track now days.
You can also wrap in mirror silver reflective vinyl to make your car look like polished stainless, gold, copper, or any other cool fake metal. Whenever Bass Pro or other big companies raffle off a car or truck, they usually have it wrapped in their logo, so the winner advertises for them while driving.