The first Model 40 was built for a 1925 U.S. Post Office competition as a replacement for the converted military de Havillands that had carried the airmail since 1918. The Model 40 used steel tubing for the nose and curved wood-veneer laminate for the middle of the fuselage. The wings were wood and fabric. The plane was hampered by the antiquated water-cooled Liberty engine, required by the government in order to use up large stocks of surplus war equipment.