By the late 1960s, Porsche had changed significantly as a company, and executives including owner Ferdinand Porsche were playing with the idea of adding a luxury touring car to the line-up. Managing Director Ernst Fuhrmann was also pressuring Ferdinand to approve development of the new model in light of concerns that the current flagship model at the time, the 911, was quickly reaching its maximum potential where it could soon no longer be improved upon. Slumping sales of the 911 seemed to confirm that the model was approaching the end of its economic life cycle. Fuhrmann envisioned the new range-topping model as being the best possible combination of a sports coupe and a luxury sedan, something well equipped and comfortable enough to be easily driven over long distances that also had the power, poise and handling prowess necessary to be driven like a sports car. This set it apart from the 911, which was a pure sports car.
Ordered by Ferry Porsche to come up with a production-feasible concept for his new model, Fuhrmann initiated a design study in 1971, eventually taking from the process the final specs for the 928. Several drivetrain layouts were considered during early development, including rear and mid-engined designs, but most were dismissed because of technical and/or legislative difficulties. Having the engine, transmission, catalytic converter(s) and exhaust all cramped into a small rear engine bay made emission and noise control more difficult, something Porsche was already facing problems with on the 911 and wanted to avoid. After deciding that the mid-engine layout didn't allow enough room in the passenger compartment, a front engine/rear wheel drive layout was chosen. Porsche also feared at the time that the U.S. government would ban the sale of rear-engined cars in response to the consumer outrage over the Chevrolet Corvair, started by Ralph Nader via his book "Unsafe at Any Speed".