It's just as confusing (or not) as the existing IDs. Except for the part where they're non-persistent
You have a point about unreadable names. Making everyone choose a latin name is a possibility too, of course. Another possibility is not displaying names at all, only IDs/codes/what have you. You don't see drivers' names written on their vehicles IRL. So, realism.
A foreign name written in Latin characters might still not be terribly readable or meaningful. This is an international community. Instead of confining it to ASCII and designating any characters as foreign, you can use a standardized code and let the names be as diverse as they're now.
IMO, being a simulator of a profession the game would benefit from this. Don't forget, you could encode VTC memberships in the IDs (e.g. "1ST1".."9STZ", "1ER1".."9ERZ" while independent players get something like "KL12").