Hi adreyn3,
Welcome to Apple Support Communities! We appreciate you reaching out for help with this issue you're experiencing with merged contacts. Let's go over all options together.
While it's certainly not expected that contacts would merge simply from both devices using the same vehicle for CarPlay, we want to be sure to mention that the manufacturer software (not CarPlay) in some car stereos may request access to your contacts list to make and receive when you're not using CarPlay. This feature existed in some stereos even prior to CarPlay, and may explain why the lists merged. Do you recall seeing a prompt on your iPhone to grant permission to access contacts specifically?
If that's the case, we do recommend checking your car stereo before connecting an iPhone, to see if the contacts are listed in there. You may want to erase them there so that the issue doesn't occur again, and may have to reach out to the manufacturer directly for the user guide or instructions.
To resolve the duplicates and incorrect names in Contacts on your iPhone, you'll have to do so manually at this point. If your contacts sync through iCloud to another device such as an iPad or Mac, you may prefer to manage them on one of those devices instead, for more screen space.
If using a hardware keyboard on a Mac, you can hold the Command key to select multiple contacts at once. Here are a couple of guides with more information:
Manage and delete contacts on your iPhone, iPad, or iPod touch - Apple Support
View your contacts in Contacts on Mac - Apple Support
We're here for you if you've got any questions!
Have a great day.