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Southern Pacific instituted a rebuild program for their SD40s in 1980-1981. The units were updated to Dash-2 electrical standards, as well as receiving electrical cabinet air filters just behind the cab on the fireman’s side. They were placed in the 73XX number series. A few units received the attractive red-and-yellow paint scheme of the proposed Southern Pacific Santa Fe merger, which combined SP scarlet with ATSF yellow. The merger was subsequently denied in 1986, but the repainted units lasted until the 1990s on the SP in some cases.

 In 1966, EMD updated its locomotive catalog with entirely new models, all powered by the new 645 diesel engine. The SD40 had 3,000 hp from a tur- bocharged V16. 856 examples of this locomotive model were built for Amer- ican railroads, 330 were built for Canadian railroads, and 72 were built for Mexican railroads.