your concept is perfect. but to develop even demonstration model you have to do lot of calculations, calibration, like
1) how far you will detect a vehicle ?
2) how many lights you will turn on n off at a time?
3) how many vehicles you will detect at a time?
4) how many inputs (sensors) and outputs (LED) you will use?
5) how you fed PWM to multiple LEDs at a time?
first try to put all these things on paper