[TomO]

It is most likely that the points in the new sending unit have corrosion on them. Connect an ohm meter between the center terminal and the case. Move the arm slowly and watch the meter. If you see wide fluctuations in the meter needle, the contact points are dirty or corroded.


Fix 1: move the arm along it full travel several times (50 minimum) and retry.
If fix 1 did not work try fix 2
Fix2: pry the top cover from the sending unit and spray contact cleaner on the points. Be careful as the wires in there are smaller that a hair and easily broken.