Yes, you understand correctly.
The image can be inserted into the Search box on Google Image Search and Google will look for similar images.
You can read about it in the Editors section.
Oh yes I understand. I never used the "Search for similar images" this way. I used it in association with an image already found by Google, such as in the case of the Venus roadster, but SACO was quickier by a few seconds.
However, i don't understand how Hondast could have find the answer with the question "is the base car British"? and why he asked this question if he had already found the car. When I copied the image on them Google search box, I found the Zwischengas reference, where it is clearly said that this car is based on a MG chassis from 1961. That was easy to decipher, even if you had a minimal knowledge of German, as the automatic translation helps a lot in such a case.
Technology, technology. BTW, Google Streets is scanning the Amazon basin. I wonder if we'll have some gems from here in the future, after the jewel from a Venezuelan scrapyard, as AP seems to be lacking a little bit of resources.