Hi,
The "car" symbol indicates the the phone is in the hands free mode.
Unfortunately the User Guide does not detail how to enable/disable the feature. Presumably it is in either the Phone Settings, Call Settings or Enhancements area.
Also here is a link which describes how to solve a Nokia "hands free" problem if the settings indicate that it is in the hands free mode.
http://repairing.u2ugsm.com/2010/03/nokia-1110-handsfree-problem-car_14.html
Sorry that I cannot be of more help.