Touchscreens are rampant right now, and while they might be great for a number of applications, they're rubbish in cars. When driving, one should be looking at the road ahead, and that means that a physical knob is much, much easier to use, because the driver can feel what it's doing.
Of course, those simply aren't cool anymore. Enter gesture-based inputs for things like the sound system and climate control. Google just filed a patent for just that, using an array of cameras to track the driver's hands. Check out the images above to see how it will work. The idea will be that you jus stick your hand out and make a "turn it up" motion to do so, no searching for an actual knob needed.