I think it's less touch = modern and more touch = cheap. Good quality switches and buttons are expensive, touchscreens and capacitive buttons are cheap.
True, the human input device(s) may be cheaper, but then on the other end you need some kind of actuator (relay, linear actuator for HVAC stuff, etc.) backed by a CAN-enabled MCU which adds back cost. Before touchscreens, to adjust the vents or temperature you slid/rotated a manual control that moved a cable or lever system which directly controlled the object in question. I don't know how those costs compare.
I do think touchscreens should be illegal in cars, they really are dangeorus. My car has physical switches, knobs and sliders, they're laid out logically and can be operated entirely by feel, I never have to take my eyes off the road.
I agree with this sentiment. I have a 2020 Lotus Evora GT, and until very recently Lotus was known for extreme simplicity so they could focus on the driving experience. Despite my car being manufactured as recently as 2020, my HVAC controls are three round knobs that I can operate by feel without ever taking my eyes off the road. My parking brake is a lever between the seats, not a button, so I can apply rear mechanical brakes to any degree desired at any time. The gauges are analog so they mentally register instantly (though there is also a digital speed display if you prefer that) and being analog they give you a immediate relative indication based solely on the needle's position, which is often more important than the absolute value.
I'm not a Luddite, but this is how motor vehicles should be controlled. Simple, tactile, eyes-don't-have-to-leave-the-road. Maximum safety requires you sacrifice the "Space Shuttle" interior experience.