The touch aspect itself is really cheap. The big benefit of screens over "simpler" instruments is that regulations actually vary quite a bit across the world. Being able to use a screen that can display anything greatly reduces the sku count, simplifying supply chains and assembly lines.
It would be hard to justify not using a screen these days, IMO.
I doubt if it's actually cheap. "The touchscreen" aka 2DIN radio/infotainment head unit slot, is required for Japanese market, as Japanese users require one of indigenous options installed for all cars. Google Maps supposedly had gotten better but aren't quite replacing it, so CP/AA doesn't work. I believe this is a unique country requirement, as many Chinese EVs as well as many European low-end cars seem to ignore it.
Not every cars are made for Japanese, far from it, but abolition of LCD based map-radio on a standardized slot is a weird hill to die on, so every cars has it anyway.
And, I think, this is where the actual "it's cheaper to..." argument begins: since every cars will have the standard issue map-radio, it _can be cheaper to move buttons into it_. Differences between the standard version and one with this context is whether the cost of the entire 2DIN screen is included in it or not - if the screen cannot be removed, to shut up whining Japanese or not, it becomes sunk cost and becomes a constant term of equation, which physical buttons have no chance of winning.
> It would be hard to justify not using a screen these days, IMO.
Unless you were concerned about the safety of someone having to look at a screen to operate vehicle controls. Otherwise you could just make it a smartphone app and ditch the screen entirely.
I should have been more clear. I meant the gauge cluster. TBH, having physical controls for things like climate, wipers, and lights makes sense. I can't imagine the cost difference is meaningful.
That would be atrocious (but not really much worse than the all-in-one infotainment screens we already have...) But my gut says automakers haven't gone there because it would make support and liability that much more complicated - "the operator was distracted at the time of the collision... but they weren't trying to turn on the defroster, they were watching Youtube!" On the plus side instead of being stuck with a never-upgraded head unit, with an orphaned 3G modem, you'd at least have connectivity that kept working.
It would be hard to justify not using a screen these days, IMO.