Porsche was always cooperating with VW. The both families Porsche and Piech are closely related and basically control the company. The Porsche AG is actually a part of VW since 2009 while the Porsche Automobil Holding SE (not to be mixed up with the Porsche AG) actually is the majority shareholder of VW. That’s how intertwined they are. Before the 924 there actually was an other direct cooperation with the 914. While the 914-6 was a real Porsche with a 6 cylinder Porsche engine the 914-4 had a 4 cylinder engine from VW. The car was built in cooperation and they even founded an own company called VW-Porsche VG for the marketing and sales of the cars. Hence the car was dubbed the “Volksporsche” in Germany. Both versions have a VW and a Porsche logo/lettering on the back.
That’s the short and simple version. The actual details are a bit more complex.
In Germany we also have the term “Flachkäfer” (flat beetle). It’s a joke about that the 356 and the 911s simply being flattened VW Beetles. I’ve even used it on one of my liveries for the Emory 356 C Cabriolet. 
