The utility of this vehicle led the German Army to develop the similar looking but shorter and lighter Sd.Kfz.

251 was commonly referred to simply as "Hanomags" by both German and Allied soldiers after the manufacturer of the vehicle;[1] this has been questioned, and may have been only a postwar label.

[2][3] German officers referred to them as SPW (Schützenpanzerwagen, or armored infantry vehicle) in their daily orders and memoirs.

The armour plates were designed to provide protection against standard rifle/ machine gun bullets (such as the 7.92×57mm Mauser).

The C model, which started production in mid-1942, featured a simplified hexagonal-shaped forward armored plate for the engine.

From early 1943, the D model was developed with the purpose of halving the number of angled body plates, simplifying the design and thus speeding up the production.

Variants were produced for specialized purposes, including with anti-aircraft guns, light howitzers, anti-tank guns and mortars or even large unguided artillery rockets, as well as a version with an infrared search light used to spot potential targets for associated Panther tanks equipped with infrared detectors.

251 also had the Schachtellaufwerk system of overlapping and interleaved main road wheels common to virtually all German halftracks of the period.

As with the Tiger I and Panther tanks that shared interleaved and overlapping main road wheels, accumulated mud and snow could clog or freeze solid between them in muddy or winter weather conditions, such as those during a Russian rasputitsa mud season, immobilizing the vehicle.

There were 232 estimated Ausf.A units produced, which took place in Hannover's Hanomag, Büssing-NAG of Berlin-Oberschöneweide, Weserhütte of Bad Oeynhausen, Wumag of Görlitz, and F. Schichau shipyard of Elbing facilities.

[4] These vehicles were meant to enable Panzergrenadiers to accompany panzers and provide infantry support as required.