All right, Group C regulations came about as the Group 5 and Group 4 Silohouette cars were losing popularity. At this point in time, both IMSA (the primary American road racing sanctioning body) and the ACO/FIA/FISA were dominated by variations on a single car - the Porsche 935.
In order to spark new manufacturer and spectator interest - a new category was devised. Prototype race cars that would emphasize all out speed AND fuel economy (yes, Group C cars were limited in how much fuel they could use over the course of a race). IMSA, having a larger privateer base than the European sanctioning bodies, modified the Group C rules into their GTP category so that the cars would be slightly less expensive to build and safer for drivers (the Porsche 962, for instance, was devised because IMSA wouldn't allow the 956 to compete in GTP due to the fact that because of the short wheelbase of the 956, the driver's ankles were in front of the front axle)
The early Group C/GTP cars started appearing in 1980 as the Silohouette cars were being phased out. The first successful proto-Group C car (as Group C wasn't quite in existence) was the Rondeau, which with Cosworth DFV power won the 1980 24 Hours of Le Mans.
By 1982, Group C rules were in full effect and the big rivalry was between the Ferrari turbo V8 powered/Dallara chassis Lancia LC2 and the Porsche 956. The Lancias had incredible speed, but the flat 6 Porsches were too reliable.
Porsche 956 - Le Mans winner 1982 as driven by Jacky Ickx and Derek Bell
Lancia LC2 - qualified 2nd for 1983 Le Mans with Michele Alboreto. retired with gearbox failure.
In American IMSA competition, GTP was also catching on in a hurry. While the early years were mostly contested by privateer March, Lola, and Rondeau chassis grappling with the proven Porsche 935's, by 1985 the Porsche 962 had come alive and the infamous Group 44 (better known for winning Trans Am and SCCA National championships with Jaguar XKE's and XJS-12's in the 70's) had developed - in association with Fabcar - the Jaguar XJR-5 GTP car.
IMSA Porsche 962 - Mid Ohio 500km winner 1985
Jaguar/Fabcar XJR-5 - fourth at Watkins Glen 3 hours, 1985
Even Ford was getting in on the IMSA GTP act with the 2.3L turbo four powered Mustang and Probe GTP cars developed by Zakspeed.
1984 Ford Mustang GTP (yes it's front engined)
1985 Ford Probe GTP
As the 80's moved on, the manufacturers grew to take even more of an interest in the technology, prestige, speed, and glamour of prototype racing. After seeing Group 44's independent success, Jaguar contacted long standing supporter Tom Walkinshaw Racing to create a factory team to assault Le Mans. With sponsorship from British tobacco firm Silk Cut, a new Le Mans classic dynasty was founded. They first arrived at Le Mans in 1986 with the XJR-6, and even though the three cars qualified in 5th, 7th, and 14th, all retired. Determined to dethrone the Rothmans Porsches, Jaguar returned in 1987 with the XJR-8. This time two cars retired, but the cars qualified 3rd-5th and the one that finished took fifth.
But 1988 was the year of the Jaguar XJR-9. The 5 TWR Silk Cut Jags qualified 4th, 6th, 12th, 9th, and 11th. The three that finished took positions 16, 4, and most importantly the win!
1988 Jaguar XJR-9 - 1988 Le Mans winner, driven by Jan Lammers, Andy Wallace, and Johnny Dumfries.
In the same year, TWR went over to the States to run in IMSA GTP with the same car. Well, they won the 24 Hours of Daytona (wearing Castrol colors) and proved a huge threat to the Porsche contingent.
1988 Jaguar XJR-9 - 1988 Daytona winner, driven by Martin Brundle, Raul Boesel, and John Nielsen
By July 1988, you couldn't walk 5 feet without seeing Silk Cut or Castrol Jag colors. The cars were so poweful in getting people into Jaguar showrooms that instantly EVERY manufacturer had a GTP/Group C program. Chevy got on board with Hendricks Motorsports (yes, the NASCAR Hendricks Motorsports) and Lola to build the T86 Corvette GTP.
Toyota started their in house Group C program using turbo four cylinders, while letting Dan Gurney's All-American Racers group to head up the GTP program using AAR Eagle chassis.
1988 Toyota 88C Group C car
1990 Toyota Eagle GTP
Nissan jumped on Group C and GTP with a vengeance. Their cars wearing the distinctive Calsonic livery, Nissan gained a reputation for blistering speed at Le Mans, but not much reliability.
But in IMSA GTP, the Nissans had speed, reliability, and were feared with unflinching fear. The NPT series of cars gaining Daytona and Sebring wins and becoming icons of IMSA.
Mercedes-Benz made a heralded return to sports car racing with the Sauber team (the team had chosen self-enforced exile since the unfortunate disaster at the 1955 24 Hours of Le Mans). The new Silver Arrows - the Sauber C9's - deposed Jaguar to 4th place in the final standings taking a 1-2 finish in 1989.
A little known fact about the Mercedes Benz/Sauber team is that in 1991 they introduced a very young German driver to international motorsport and to Le Mans. The young man - who, by the way, raced to a 5th place finish and qualified 4th - was 7 time World Champion Michael Schumacher.
Mazda chose Group C and IMSA GTP as a testing ground to push rotary technology even further. Their Mazdaspeed developed cars were rarely the fastest, but had incredible reliability and for a brief shining moment in 1991, they outlasted the Silk Cut Jags and Sauber Mercedes to take the only Japanese win ever at the 24 Hours of Le Mans with the glorious 787B
Even tiny, underfunded Aston Martin built a Group C car in hopes of reviving their fading fortunes. They even scored an 11th at Le Mans in 1989 in what would be their only appearance.
Going into the mid 90's, the fights were clear. In American IMSA GTP, the Nissans, TWR Jaguars, and Toyota Eagles were in a huge fight (occasionally spoiled by Chevy's Intrepid GTP) while at Le Mans the fight was Jaguar, Mercedes, Peugeot, and the large Japanese contingent (Nissan, Toyota, and Mazda). Never before had Le Mans been so competitive or so expensive.
Single cars cost millions, and in the case of some factory cars, tens of millions, of dollars. Speeds were ludicrous as 220mph on the Daytona high banks and 240 down the long Mulsanne straight were not uncommon. Group C aerodynamics had led to tightly drawn bodies with enveloped rear wheels and huge rear wings. IMSA GTP cars had long tails for lessened drag and slab noses for high downforce. By 1992, when the "full body F1 car" Peugeot 905
won Le Mans, the FIA and IMSA decided it was time to listen to the cries of the privateers (and their wallets) and create a more production based, less exotic, and less expensive category with open cockpit cars. Thus, the last of the Group C cars turned wheels in anger. Fittingly, it was a modified Porsche 962, in of itself a modified version of the Porsche 956 which rang in the Group C era, closed the book on the Group C cars with its win at Le Mans in 1994.
In 1995, the Group C cars were gone and the WSC cars like the Riley & Scott MkIII, the Ferrari 333SP, and the Kremer Porsche, had taken hold. Though they didn't win overall that year - a McLaren F1 did - they still rang the death knell for the glorious Group C and GTP era. It was a time of high speed, glamour, and factory effort of a like not seen before or since. The WSC cars would evolve into LMP, and that McLaren win would foster the GT1 cars (in many ways, a recreation of the intensity of the Group C battle) but with chicanes on the Mulsanne the ultimate speed was taken from the equation. Truly, there'll never be another beautiful example of technological barbarity, of elegant carnage, than the Group C/GTP era.