To go to your car setup, go to the Garage menu and click on Car Setup. This will take you to the Car Setup screen where you can experiment with different setups. Before you go out on your first test lap, you might want to look at your engineer's advice (there's a link in the top right corner of the screen, just above the lap times table and just below the Results menu). The engineer's advice will give you a vague idea to start off with.
You'll see at the top of the car setup screen a slider called 'Experimentation'. This slider sets how hard your driver will push to get more data. The harder you push, the more data you will get to improve your settings. However, push him too hard and he'll crash and you could lose a couple of practice laps whilst the car is recovered. The BatRacer Hints Page suggests setting Experimentation to 72 is a good balance between getting lots of data and crashing. Also, on your final test lap you may as well set your Experimentation to 100 (or something very high) because even if you crash you will receive lots of data and you have no laps to lose.
You can choose your tyres just below the Experimentation slider. To get the best performance, you need to choose the best tyres for the current weather conditions. You will find the weather conditions mentioned just above the Experimentation slider and just to the left of the lap times table. It will say something like "You need a setup suitable for bone dry conditions." There is also a weather report at the very top right of the screen.
To send your car out on a test lap, click on the Test button at the very bottom of the screen. Each time comes back from the test lap, you will hopefully receive more data to fine-tune all of your settings. You will see below each slider whether more data has been received for that setting. The ideal setting will be a number somewhere between the "hi" and "lo" mentioned below each setting. As you get more and more data, you will be able to narrow down the high and low until you find the perfect (or "Spot On") setting.
Sharing data with your teammate means that all of the perfect settings can be found. When you have finished testing, click on the Save button located at the bottom of the screen. Your teammate can then load these settings by using the Load button (also located at the bottom of the screen:

Also, use the Team Talk page to share what you have found out from testing (e.g. that the front wings should be set somewhere between 60 and 75). To go to the Team Talk page, go to the Office menu and click on Team Talk.
Use the Team Talk to list what you have found out for each setting. Basically, you list the high and low you have found for each setting. An example message in Team Talk could be:
Your teammate can then load your settings and try to narrow down the high and low for each setting based on your message in Team Talk. When your teammate has finished, he can save his settings and post a new list of improved settings in Team Talk for you to use.Wings
F 80 - 100
R 50 - 60
Suspension
F 0 - 40
R 22 - 34
ARB
F 18- 40
R 44 - 50
Ride H
F 60
R 65 - 68
Tyres
F 31
R 50 - 90
Gears
36 - 50
Brakes
15 - 20