Is there already a bluetooth device with the same name stored in you vehicle?
If your new iPhone 7 has the same name as an iPhone that was previously synced with your vehicle, it won't work. For example, I had to remove my iPhone 6 from my car when I got an iPhone 7 because I restored my 7 with a backup from my 6, thus bringing the same name information over to the 7. So my car was trying to use Bluetooth information for my 6 to connect to my 7.
Try removing all other Bluetooth devices synced to your vehicle, restart the iPhone, and try again.