Why are side tones so important?

Side tones, simply put, are your ability to hear your own voice when you speak. It is how your brain gets the feedback it requires to adjust the volume of your voice to suit the environment you are in at any given time.

They are the reason that you speak at the appropriate level at a loud party without having to be told to raise your voice and why you don't hear "SHHHHH" when you are whispering in a library.

If side tones are so necessary, why would any manufacturer make a system that does not include them?

Quite simply, it is a very difficult task that requires advanced knowledge of communciations and communications engineering to create a communication solution that will allow you to bring not one microphone signal (your passenger's), but two (yours and your passengers)* to each set of headset speakers efficiently. Remember for most manufacturer's there are only three steps in the communication process: 1) pick up a (voice) signal, 2) amplify that signal, 3) present that signal to the speakers. The problem is obvious for these systems. As they do not elimiinate or reject the ambient noise from entering the system they are amplifying ambient noise into your speakers, which is far worse than the ambient noise itself.  Picking up one microphone works with some results for these systems ... picking up two would greatly detiorate their performance. The result is linear and would mean double the noise and HALF the performance they normally would experience (which is far less than Autocom already).