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@msh210 is correct that רכב is the more general term for all types of vehicles while אוטו refers specifically to cars. Two other terms for 'car' are רכב פרטי which means 'private vehicle' and מכוני...
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#1: Initial revision
@msh210 is correct that רכב is the more general term for all types of vehicles while אוטו refers specifically to cars. Two other terms for 'car' are רכב פרטי which means 'private vehicle' and מכונית which comes from מכונה which comes from 'machine'. רכב פרטי is a very formal term, usually used for documentation or other offical things. מכונית or plain רכב are more formal than אוטו (which, in my opinion, has developed a child-like connotation over the years, perhaps because of children's songs that use the word, such as "[האוטו שלנו גדול וירוק](https://www.youtube.com/watch?v=2F0tRTiIELw)". Oddly enough, the similar word for bus, אוטובוס, hasn't had any change in connotation). While it's more common for people over a certain age (twelve and above, roughly) to use רכב or מכונית, the word אוטו is still quite common, though, as I said, much less formal. In other words, as long as the vehicle you're referring to is a car and not a bus, truck, motorcycle, etc, there's no real problem in calling it an אוטו (and if you think about it, while both רכב and אוטו have two vowels, it's quicker to say אוטו, so if a car is coming by quickly, the faster warning call would be אוטו, which is, of course, preferable for the safety of all).