"친구는 자동차가 있습니다."
Translation:The friend has a car.
In fact, the 차 in 자동차 is a Chinese character that originally referred to a wheeled carriage/cart. It's present in the name of pretty much every wheeled vehicle.
As well, train specifically is 기차 but if you referred to the individual wheeled sections of the train (the train's cars) you'd say 차.
Topic markers 은/는 are used for specific things. Like: 'The friend has THE car'. This is talking about a specific car.
Subject markers 가/이 are for general things. Like: 'The friend has A car'. This isn't being specific, its just talking about, in general the friend has a car of some sort.
Think of it like in school. You have subjects like maths or english but in those subjects you have specific topics you learn, like algebra or poems.
No. They're not interchangeable. Sometimes, they can be but often they aren't.
Often, the topic maker is used for a general statement about the thing marked as the topic, whereas if you use the subject marker, you'd be making a statement about a particular noun (like, 남자가 refers to a specific man and 남자들이 to a particular group of men).
Korean people say 차 as a shortened form of 자동차 literally every day. In fact, if you said "나는 자동차를 타요." instead of "나는 차를 타요.", it would come off as a correct-but-strange sentence.
In 자동차, 차 is a term from Chinese that originally meant a cart/carriage and in both Korean and Chinese had taken the meaning of any vehicle. You'll find it in nearly every word for a vehicle with wheels in Korean.
For example, 기차/열차 mean train, but if a Korean were to refer to one of the separate wheeled sections of the train (its "cars"), they would use the word 차.
The difference in Korean? 차/자동차 can refer to any and all vehicles, but people use it for car most often.
And if you mean in English, busses, cars, trucks, SUVs, vans, and maybe even motorcycles are automobiles. It's anything meant to move people on regular roads using an engine.
A car is a specific type of automobile
In most cases, 은/는 is used for making general statements about the noun in question whereas 이/가 is used for talking about a particular example of the thing.
As a simple example: "가과는 과일입니다." is a general statement that could translate to "An apple is a fruit." or "Apples are fruits."
Whereas: "사과가 맛없습니다." means "The/This apple tastes bad."
There's nothing in the sentence that means "of the". And with it being "친구는", the sentence's topic/focus is on the friend, but in your translation, it's changed to be a sentence about the car. Also, "The car is of the friend." wouldn't translate to something using "있다"; you'd use 이다 (입니다) for describing something.
Taken literally, the sentence says "Friend(topic) car(subject) be/exist/has." By context, it's understood that 있습니다 means "has" here.
So, duolingo defaults it to be "The friend has a car."
Duolingo also accepts "My friend has a car." because in reality, it's implied that if I write about "a friend" that I really mean one of my friends.