Automatic placements enable FB to get the best results available across all default placements. Because they can choose results from the widest range possible, automatic placements are typically the most efficient use of your budget and help control costs.
However, you may be confused about why FB recommends this if you use the lowest cost bid strategy and check the average cost per optimization event for each placement in your reports. For example, if the average cost per optimization event on Facebook Feeds is significantly cheaper than it is on Instagram Stories, you might want to stop placing your ads in Instagram Stories and place more of them on Facebook Feeds.
Keep in mind that the Facebook delivery system is designed to get you the most optimization events at the lowest average cost overall - not the lowest average cost for each placement. This means FB looks at all available opportunities across all placements and select the least-expensive ones without regard for what the average cost per optimization event will be for each placement.
Another benefit of automatic placements is that if you decide to duplicate a campaign, any new placements will automatically become available for your duplicated ad.