Exhibit 3.07

                       Certificate of Ownership and Merger
                                       of
                    MotivePower Industries, Inc. (Subsidiary)
                            (a Delaware corporation)
                                      into
                          MK Rail Corporation (Parent)
                            (a Delaware corporation)


Pursuant to Section 253 of the General Corporation Law of the State of Delaware,
MK Rail  Corporation  (the  "Parent"),  a  Delaware  corporation  and the parent
corporation to its wholly-owned  subsidiary,  MotivePower Industries,  Inc. (the
"Subsidiary"), a Delaware corporation, hereby certifies that:

1.       Attached  hereto as  Exhibit A are  resolutions  (the  "Resolutions  of
         Merger") duly adopted on December 16, 1996 by the Board of Directors of
         the Parent,  pursuant to which the Subsidiary  shall be merged into the
         Parent,  and the  name of the  surviving  parent  corporation  shall be
         changed from "MK Rail Corporation" to "MotivePower  Industries,  Inc.,"
         which Resolutions of Merger have been approved and adopted by the Board
         of Directors of the Parent in accordance  with the  requirements of the
         General Corporation Law of the State of Delaware.

2.       The Certificate of Incorporation of the surviving  corporation shall be
         the Certificate of Incorporation of the Parent as in effect immediately
         prior to the merger  (except  the name shall be changed as  provided in
         the  Resolutions  of  Merger  and  as  noted  in  paragraph  1 of  this
         Certificate).

3.       The  Resolutions  of  Merger  are on  file at  1200  Reedsdale  Street,
         Pittsburgh,  Pennsylvania 15233, the principal place of business of the
         surviving corporation.

4.       The merger shall be effective at 12:01 a.m. on January 1, 1997.

IN WITNESS  WHEREOF,  this  Certificate  is  executed  by the  undersigned  duly
authorized  officer on behalf of MK Rail  Corporation,  a Delaware  corporation,
this 26th day of December, 1996.

                                                     MK Rail Corporation
                                                     (a Delaware corporation)


                                                     By: /s/ William D. Grab
                                                     Name:    William D. Grab
                                                     Title:      Vice President

122714.WPD

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                                    Exhibit A

         Resolutions  of the  Board of  Directors  of MK Rail  Corporation  (the
         "Company")  Adopted at a Meeting of the Board of  Directors on December
         16, 1996

         WHEREAS,  MotivePower  Industries,  Inc., a Delaware  corporation,  was
         incorporated on August 26, 1996; and

         WHEREAS,  the Company owns all of the issued and  outstanding  stock of
         MotivePower Industries, Inc.; and

         WHEREAS, the Company desires to merge MotivePower Industries, Inc. into
         the Company under Sections 253 of the Delaware General  Corporation Law
         (the "DGCL"); and

         WHEREAS,  the Company  shall be the surviving  corporation  of the said
         merger; and

         WHEREAS,  as a result of said merger,  the name of Company shall change
         to MotivePower Industries, Inc.;

         RESOLVED, that the merger of MotivePower  Industries,  Inc., which is a
         wholly-owned subsidiary of the Company, with and into the Company shall
         be, and hereby is, approved in all respects; and further

         RESOLVED,  that as a result of the  merger,  all  stock of  MotivePower
         Industries,  Inc. outstanding  immediately prior to the merger shall be
         cancelled and all stock of the Parent outstanding  immediately prior to
         the merger  shall  continue  to be stock of the  surviving  corporation
         after the merger; and further

         RESOLVED,  that the  Certificate  of  Incorporation  of the  Company in
         effect  immediately  prior to the merger  shall be the  Certificate  of
         Incorporation of the Company as the surviving  corporation at and after
         the effective date of the merger, except that the name of the surviving
         corporation  shall be changed from MK Rail  Corporation  to MotivePower
         Industries, Inc.; and further

         RESOLVED,  that the merger shall be  effective on January 1, 1997;  and
         further

         RESOLVED,  that the  President or any Vice  President of the Company is
         hereby authorized,  empowered and directed to execute for and on behalf
         of the Company a  Certificate  of  Ownership  and Merger and such other
         documents, all containing such terms as any such officer approves, such
         approval to be conclusively  evidenced by any such officer's  execution
         and  delivery  thereof,  and to  perform  such  other  acts as any such
         officer shall deem necessary or  appropriate to effectuate  such merger
         in the State of Delaware; and further

         RESOLVED,  that the President  and any Vice  President and Secretary of
         the Company be, and each of them hereby is,  authorized,  empowered and
         directed,  for and on behalf of the Company,  and as its  corporate act
         and deed,  to execute  and deliver  all other  documents,  instruments,
         certificates,  and agreements,  and to do all acts and things as may be
         necessary and  appropriate to carry out the purpose and intent of these
         resolutions.

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