AMG was founded as a racing engine forge in 1967 under the name AMG Motorenbau und Entwicklungsgesellschaft mbH (AMG Engine Production and Development, Ltd.), by former Mercedes engineers Hans Werner Aufrecht and Erhard Melcher in Burgstall an der Murr, near Stuttgart. The letters “AMG” stand for Aufrecht, Melcher and Großaspach, Aufrecht’s birthplace (but at no time an AMG location). In 1976 most of AMG moved to Affalterbach, with the racing engine development remaining at the old location in Burgstall. At this time Erhard Melcher ceased to be a partner, but continued to be an employee at the Burgstall location.
In 1990, with AMG having become a high-profile purveyor of modified Mercedes cars, Daimler-Benz AG and AMG signed a contract of cooperation, allowing AMG to leverage Daimler-Benz’s extensive dealer network and leading to commonly developed vehicles (the first one being the Mercedes-Benz C 36 AMG, in 1993). On 1 January 1999 DaimlerChrysler, as it was called between 1998 and 2007, acquired 51 percent of AMG shares, and AMG was renamed to Mercedes-AMG GmbH. Racing engine development was divested and continues to exist in Burgstall under the name HWA (Aufrecht’s initials). On 1 January 2005 Aufrecht sold his remaining shares to DaimlerChrysler, and since then it has been a wholly-owned subsidiary.
AMG Penta 5 Spoke 16×8 type 1 wheel
AMG started off by designing and testing racing engines. It expanded its business into building custom road cars based upon standard Mercedes cars.