GM, seeing the success of the custom streamliners, sought to expand the market for diesel power by producing standardized locomotives under their Electro-Motive Corporation. In 1936, EMC's new factory started production of switch engines. In 1937, the factory started producing their new E series streamlined passenger locomotives, which would be upgraded with more reliable purpose-built engines in 1938. Seeing the performance and reliability of the new 567 model engine in passenger locomotives, EMC was eager to demonstrate diesel's viability in freight service.