The reason why AM is left off is because engineers designing radios don't know how to do their jobs, and the digital stuff in the radios causes interference to AM,
All newer radios (10 years or less) are Software Defined Radios (SDR). There are no new designs being made and no engineers designing them for the Medium Wave (AM) broadcast band. Now engineers at Delphi and alike, are working on in-car connectivity and user experience functions. Higher-end vehicle entertainment systems are rapidly becoming devoid of AM tuners anyway. Like it or not, that is the trend.
and they don't know how to isolate ground places and decouple. Analog design is a vanishing art, and the engineers don't know it.
Maybe the "engineers" you speak about don't know it, because they aren't being assigned to work on a solution that's run it's course? Analog-anything is vanishing, period.
i-Anything is not going to work well on AM or FM.
As David correctly points out, that's because most people who rely on their IPhone, or other 'smartphone' for information and entertainment, can care less about AM or FM radio. They get what they need on a single device that fits in their pocket or purse.