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AFAIK it’s the cars from other towns that cause these enormous traffic jams. Cut them off and that’s that. Can’t do that if you connect towns via tram or bus lines… Therefore i always use railway to connect towns. Once i see a traffic jam i bulldoze just a piece of road at the town that the cars are coming from and the whole mess is cleared in a second. I do make sure that my industrie cargo lines are not affected by cutting off a piece of road.
I find that bus lines don’t work too well in cities, tram lines work much better. 3 cities are connected via double track railway running 4 trains. Has always been extremely profitable. Often trains have to leave a few pax behind because the’re fully booked.