Why not both?

Cognitive load. Good operator experience, user interface, you want the operator of the vehicle to require the least amount of thinking to know about the vehicle. It's critical data they'll need an emergency is, and in emergencies, people's cognitive abilities go down quite a bit.

Just think about how you turn the radio down to find an address on the street, multiply that times a thousand. That's how people think in an emergency

I have a Yaris with both.

Car manufacturers won't spend extra on a fancy feature unless they can't sell without it. That's why most cars have such nasty low-res screens for the entertainment system, when a nice high res one (like the one you have in your phone) would only cost a few quid more.

It look cool

My car has both digital and analog on the dash.

The position of the needle on the dial is easier to see with peripheral vision, versus numbers.

Some cars have a digital speedo HUD displayed on the windshield. I find it too distracting.

My friend has a newish Nissan Leaf electric car which has an analog speedometer. That baffles me since everything else is digital.

My old Scion had a digital one. I think it’s an aesthetic preference.

You're aware that luxury cars may have both, e.g. Aston Martin DB11