As a few others have pointed out, there is no DAC in your iPhone and you are sending a digital signal into your car's audio system. You could try a dongle DAC with your phone if your car's audio system has an analog input, but I suspect that you would not have access to Car Play with that connection.
Check to make sure the settings in your Tidal app are the ones you want. You can choose different levels of resolution for wi-fi and mobile data. I wouldn't be surprised if the default for mobile data is lower resolution to minimize data usage.