Since there was a further need for electric shunting locomotives after the procurement of the E 60, additional locomotives were to be ordered for southern Germany. Although the E 60 served its purpose, the company wanted to take advantage of the advances in development and commissioned two competitors to develop a modern locomotive using parts from existing models. A main focus was the removal of the carrying axle in order to be able to use the entire weight of the locomotive for traction. The current state of development brought weight savings with it, which led to a three-axle design with a similar tractive power as the E 60. The chassis construction with the crank axle and the three coupled axles was to be based on that of the E 60. The specific order now went to AEG on the one hand and to a joint venture consisting of Krauss-Maffei and the BBC on the other.
In 1935, AEG delivered four examples of their design as E 63 01 to E 63 04. They used one of the motors, of which the E 18 had four, to power them. This led to an hourly output of 725 kW and had a high tractive power with a much shorter gear ratio. Due to the small size of the motor and a clever arrangement of the equipment, it was possible to keep the hoods low compared to the predecessor and thus ensure good visibility in both directions. Two engines each were stationed in Munich and Stuttgart.
The three locomotives from Krauss-Maffei and BBC were also delivered in 1935 and were given the numbers E 63 05 to E 63 07. They were also given a motor from a four-motor express locomotive from the same manufacturer, which in this case was the E 161. As with the E 60, the equipment was accommodated in relatively high hoods that were sloped at the ends. All three were used in Munich.
The comparison not only showed the better visibility of the AEG engines, but also the starting tractive effort of 167 kN and 118 kN differed much more despite similar hourly output. Thus, in the course of the planned electrification of further main lines and the associated stations, it was decided to procure further locomotives of the AEG design. Due to the beginning of the war, however, only the E 63 08 was built.
All eight survived the Second World War. Two of them, which had been on Austrian territory, were brought back to Germany in exchange for other locomotives. There, six were used at different locations in Bavaria and two in Stuttgart. All were modernized in 1960 and renumbered as class 163 in 1968. All eight were still in service until about the mid-1970s, but their numbers then quickly dwindled and finally, in 1979, 163 002 was the last to be retired. Four have survived to this day, of which E 63 02 has been operational again since 2013.