Index: src/autoreplace_cmd.cpp
===================================================================
--- src/autoreplace_cmd.cpp	(revision 27902)
+++ src/autoreplace_cmd.cpp	(working copy)
@@ -65,9 +65,6 @@
 
 	switch (type) {
 		case VEH_TRAIN: {
-			/* make sure the railtypes are compatible */
-			if ((GetRailTypeInfo(e_from->u.rail.railtype)->compatible_railtypes & GetRailTypeInfo(e_to->u.rail.railtype)->compatible_railtypes) == 0) return false;
-
 			/* make sure we do not replace wagons with engines or vice versa */
 			if ((e_from->u.rail.railveh_type == RAILVEH_WAGON) != (e_to->u.rail.railveh_type == RAILVEH_WAGON)) return false;
 			break;
@@ -657,6 +654,7 @@
 /**
  * Autoreplaces a vehicle
  * Trains are replaced as a whole chain, free wagons in depot are replaced on their own
+ * They are only replaced if the depot supports them.
  * @param tile not used
  * @param flags type of operation
  * @param p1 Index of vehicle
Index: src/rail_cmd.cpp
===================================================================
--- src/rail_cmd.cpp	(revision 27902)
+++ src/rail_cmd.cpp	(working copy)
@@ -40,6 +40,9 @@
 
 #include "safeguards.h"
 
+#include <vector>
+#include <algorithm>
+
 /** Helper type for lists/vectors of trains */
 typedef SmallVector<Train *, 16> TrainList;
 
@@ -1533,7 +1536,64 @@
 	return NULL;
 }
 
+/** Temporary data storage for finding a list of trains on a tile. */
+struct TrainListData {
+	TileIndex tile;
+	std::vector<Train*> trains;
+};
+
+
+static Vehicle *FindTrainOnTileEnum(Vehicle *v, void *data)
+{
+	TrainListData* tld = (TrainListData*)data;
+
+	/* if not a train */
+	if (v->type != VEH_TRAIN) return NULL;
+
+	/* get first cart */
+	Train *w = Train::From(v)->First();
+
+	while (w != NULL)
+	{
+		/* check if train is on the tile */
+		if (w->tile == tld->tile)
+		{
+			/* if so add to tld.trains */
+			tld->trains.push_back(w->First());
+			return NULL;
+		}
+
+		/* see next cart */
+		w = w->Next();
+	}
+
+	return NULL;
+}
+
 /**
+ * Locate all trains on a depot rail tile
+ * @param tile tile to check for trains on
+ * @return an vector of trains on the tile including those in the depot
+ * @pre tile must contain a depot
+ */
+static std::vector<Train*> GrabListOfTrainsOnDepotTile(TileIndex tile)
+{
+	auto tld = TrainListData();
+	tld.tile = tile;
+
+	FindVehicleOnPos(tile, &tld, FindTrainOnTileEnum);
+
+	/* Make the list unique */
+	std::sort(std::begin(tld.trains), std::end(tld.trains));
+	tld.trains.erase (
+			std::unique(std::begin(tld.trains), std::end(tld.trains)),
+			std::end(tld.trains)
+	);
+
+	return tld.trains;
+}
+
+/**
  * Convert one rail type to the other. You can convert normal rail to
  * monorail/maglev easily or vice-versa.
  * @param tile end tile of rail conversion drag
@@ -1599,6 +1659,9 @@
 
 		SmallVector<Train *, 2> vehicles_affected;
 
+		bool should_upgrade_trains = false;
+		std::vector<Train*> v_list;
+
 		/* Vehicle on the tile when not converting Rail <-> ElRail
 		 * Tunnels and bridges have special check later */
 		if (tt != MP_TUNNELBRIDGE) {
@@ -1605,8 +1668,26 @@
 			if (!IsCompatibleRail(type, totype)) {
 				CommandCost ret = IsPlainRailTile(tile) ? EnsureNoTrainOnTrackBits(tile, GetTrackBits(tile)) : EnsureNoVehicleOnGround(tile);
 				if (ret.Failed()) {
-					error = ret;
-					continue;
+					/* if its not a depot tile */
+					if (GetRailTileType(tile) != RAIL_TILE_DEPOT) {
+						error = ret;
+						continue;
+					} else {
+						/* if it is check if all trains are stopped in depot */
+						v_list = GrabListOfTrainsOnDepotTile(tile);
+						for(auto v : v_list) {
+							/* If one is not then fail */
+							if(!v->IsStoppedInDepot()) {
+								/* Sometimes if we run continue it will still
+								 * upgrade this tile. Just return instead */
+								return ret;
+							}
+						}
+						
+						/* Trains only upgrade if depot supports them, however
+						 * depot hasn't upgraded yet. */
+						should_upgrade_trains = true;
+					}
 				}
 			}
 			if (flags & DC_EXEC) { // we can safely convert, too
@@ -1637,6 +1718,15 @@
 
 				SetRailType(tile, totype);
 				MarkTileDirtyByTile(tile);
+
+				/* Upgrade trains if we should */
+				if (should_upgrade_trains) {
+					/* if they are all stoped then replace trains */
+					for(auto v : v_list) {
+						ret = DoCommand(0, v->index, 0, flags, CMD_AUTOREPLACE_VEHICLE);
+					}
+				}
+
 				/* update power of train on this tile */
 				FindVehicleOnPos(tile, &affected_trains, &UpdateTrainPowerProc);
 			}
@@ -2680,7 +2770,6 @@
 	}
 }
 
-
 static TrackStatus GetTileTrackStatus_Track(TileIndex tile, TransportType mode, uint sub_mode, DiagDirection side)
 {
 	/* Case of half tile slope with water. */