This is correct. Early A's can use a 727 but it's a super tight fit and may need some massaging from the BFH. The only overdrive transmission Mopar ever made was the a500 and A518 and both are way too big to fit into an early A without a lot of crossmember and floor work. Heck they won't even fit in a later A body without work. Your only easy option for using a OD trans is the Keisler OD conversion that uses a Chevy 700r4 or better yet installing a Gear Vendors od unit. But my choice would be a 904. The 904 is plenty strong for most any 318. It'll easily handle 425-450 hp if properly rebuilt just by adding a good Trans-go TF-2 shift kit. When I say properly I mean not just yanking it apart and slapping in new clutch plates. I mean completely taking it apart and hot tanking everything, rebuilding the clutch packs and setting the clutch plate clearance properly using selective snap rings, installing all new bushings and thrust washers, tightening up the gear train end play via special shims, and using the proper selective thrust washers to obtain the correct total end play and replacing the pump gears or pump if it's worn and checking the clearances to make sure everything is in spec. That way things aren't slapping around beating themselves to pieces. Then you completely disassemble the valve body and thoroughly clean every part and install a Trans-go TF-2 shift kit.
