The development of armored cars in Germany began in the late 1920s. In the mid-1930s, when Adolf Hitler brought the Nazis to power, the German army was quickly reorganized, and the terms of the Versailles Treaty were progressively broken. The Blitzkrieg concept demanded close co-operation between infantry and armored units and the role of the armored car was very important.
Initially only light armored cars were intended for mass production, but the army's requirements were soon greatly extended, and as a result, new types of armored car were produced. The Bussing NAG factory developed its own design, which received the name ARW (Achtradwagen = eight-wheeled car). The new car had some interesting features, like eight independently sprung wheels with both steering systems affecting all eight wheels. It could be driven in both directions because it had two driver positions, in the front and in the back. The armored superstructure was attached to the frame of the chassis. The armored body was 14.5mm thick in front and 8mm elsewhere.
The first mass-produced machines of this type received the official designation Sd.Kfz.231 and reached units of the Panzer reconnaissance troops in late 1937, and one year later they took part in the annexation of Czechoslovakia. During the Blitzkrieg in 1940 these machines proved their importance in battles in Poland, France, Belgium and the Netherlands. Shortcomings such as a lack of driver protection were improved after combat experience. All in all the Sd.Kfz.231 was a very trustworthy vehicle.
At the time of its introduction in 1937 the Sd.Kfz.231 was the most modern armored car of its time. It was difficult to maintain and repair and the Germans on all battlefields extensively used an easy target for an enemy due to its height, but these armored cars until the last days of World War Two, with considerable success.