Vehicular ad hoc networks are an important new class of wireless networks with applications ranging from safety and crash avoidance to Internet access and multimedia distribution. In this paper, an efficient method of message dissemination using rateless coding is proposed. Both vehicle-to-vehicle and vehicle-to-infrastructure data transfer are allowed. By employing rateless coding at road side units and using vehicles as data carriers, messages can be propagated efficiently. To limit the buffer capacity required in vehicles, buffer management is employed. The network considered has a grid topology. The effects of vehicle speed, number of lanes, broadcast interval, and decoding distance on the performance are examined.