Residents in Eastfield Road were woken just before 2am when a vehicle crashed and rolled into fencing near their homes.
Fire crews were called to the scene as smoke poured from the vehicle.
A resident told the Peterborough Telegraph: “We heard a great bang and went outside and the car was in the hedge.
“It looks like the car came down the road, went into the layby and then crashed into the hedge near a house.
“The driver was very lucky, if the car had hit the large tree I don’t think he would have survived.
“The driver did get out of the car and walked away. He was very lucky it wasn’t much more serious.
“It’s not the first time it has happened. It is a bit of a hotspot. It is a tricky bit of road on a curve.”
A spokesman for Cambridgeshire Fire & Rescue said: “We were called to reports of a car fire on Eastfield road at around 1.50am.
“The crew arrived to find a car well alight and on its side following a road traffic collision. Wearing breathing apparatus, firefighters used hose reels to extinguish the fire.
“The cause of the fire was accidental. The crew returned to their station by 3am.”
It is understood police are investigating the incident.
