If the thermostat contacts are closed and the blower motor only runs when the fan switch is set to ON, what could be the issue?

The scenario described indicates that the thermostat contacts are closed, meaning that the thermostat is calling for heat or cooling, but the blower motor only operates when the fan switch is set to the "ON" position. This situation suggests that the automatic fan operation, which is typically controlled by the thermostat, is not functioning properly.

When the fan switch is set to "AUTO," the blower motor is supposed to run in harmony with the operation of the heating or cooling system. If the blower motor operates only when manually set to "ON," it indicates that the thermostat's AUTO/FAN control is not working correctly. Essentially, the thermostat is not sending the signal to operate the blower motor automatically when the system requires it, thus pointing to an issue within the thermostat itself.

This problem can arise due to several factors, such as internal component failure within the thermostat or faulty wiring connections. As a result, the thermostat is the most probable source of the issue, which aligns with the correct choice given.