Why does FM sound better than AM?

Also the audio frequency bandwidth is narrower on AM, so fewer treble frequencies.

TBH I think music from up to the late '60s (especially if originally released in mono) sounds really good, or at least more "era-appropriate" on AM radio. I remember my grandparents tuning in to easy-listening AM stations as I grew up in the '70s and '80s, to my ear Tennessee Ernie Ford's "16 Tons" or a classic Phil Spector "Wall of Sound" production sounds more "right" coming through the AM bands.

And, in the age of cellphone speakers and compressed MP3/Bluetooth codecs - I'm not sure how much people actually care about audio quality.