The emerging Vehicular Ad-hoc Network (VANET) technology will enable many exciting applications such as vehicular safety assistance and mobile entertainment. One of the key challenges toward successful roll-out of VANET applications is to provide security and privacy preserving mechanisms for users. Existing efforts on this topic rely heavily on infrastructure like road-side units which however are not available everywhere. To minimize the dependence on infrastructure, we propose a novel Peer-based Automobile Identity Management (PAIM) Framework which is mainly based on vehicle-to-vehicle communication. PAIM supports dynamic event-based moving zones formed by vehicles sharing common interest. PAIM achieves the level of privacy desired by vehicles and traceability required by law enforcement authorities, in addition to satisfying fundamental security requirements including authentication, non-repudiation, message integrity and confidentiality. A prototype of PAIM is built and tested and the results demonstrate the efficiency and feasibility of our approach.