I'd argue that they can't go too much faster in cities. For starters, people live in cities and tend to walk or bike places. On a city street with no people walking around, sure, cars could go faster and be safe.
But in a city with people, cars will need to go slower and stop for people (or some combination). Even with instantaneous reaction, a car can only stop so fast.
But in a city with people, cars will need to go slower and stop for people (or some combination). Even with instantaneous reaction, a car can only stop so fast.