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Swap in an H55F and split case. Find a 79+ rear axle for the parking brake.

The cummins r2.8 is considered the way to go. To bad diesel fuel is much higher than gasoline negating the savings.
I did too because the F motors and stock tank my range was very limited so between the R2.8 and the 29 gallon tank I may have more range then my Ram 3500. But have not been able to test the theory yet.I would go another route than the 2.8 if I were to do it again. But, brainwashed Cummins fanboy gotta do what brainwashed Cummins fanboy gotta do.
I did it for range more than anything.
20-21mpg is pretty consistent for me
For the money you would put into the 40 to try to make it more efficient you could likely buy a used corolla that will get 40 MPG and go 300k with nothing more than regular maintOne other note, as you are chasing 1 or 2 MPG's consider how much fuel you can buy for the mods you are making to pick up those couple MPG's.
Here's the math to back that up: At 150 miles per week at $4/gal fuel if you go from 14 to 16 mpg you save $278/year. It's going to take years at that rate to pay out any significant modification to get those 2 mpg's.
Buy a used small car, that's likely a better use of funds. Save the 40 for weekends.
The H55F and split case with 3:1 low range was more then I paid for the 40 new in 1978. The parking brake can still be used with the split case. If you have the 4 speed case and let the builder know they can build the TC to accept the parking brake. All the parts are off the shelf and still available.
The H55F requires a cross member that the 4 speed does not have. But I kept the mounts for the bell housing and the cross member under the transmission.
For me it was already in my rebuild plan to upgrade to a 5 speed and split transfer case behind a diesel.
There is a lot of support available for converting to the H55F.
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