Preheat oven to 350°F (175°C) and grease two 9-inch round cake pans with butter and flour.
In a large bowl, sift together the flour, sugar, baking soda, salt, and cocoa powder.
In a separate medium bowl, whisk together the vegetable oil, buttermilk, eggs, red food coloring, vinegar, and vanilla extract.
Using a stand mixer or hand mixer, gradually add the wet ingredients to the dry ingredients and mix on medium speed until smooth and well combined.
Divide the batter evenly between the two prepared cake pans.
Bake for 30 to 35 minutes, or until a toothpick inserted into the center of the cakes comes out clean.
Cool the cakes in their pans for 10 minutes, then invert onto a wire rack to cool completely before frosting.
Prepare the frosting by beating the softened cream cheese and butter together until smooth. Gradually add powdered sugar and 1 teaspoon of vanilla extract, beating until light and fluffy.
Assemble the cake by frosting the top of one layer, placing the second layer on top, and frosting the top and sides of the entire cake.