I smell a missing D+ signal on the back of the alt (small red wire, blue/green in 940s), as Phil mentioned. It's needed to excite the alternator and enable the charging circuit.
First off, even with the D+ wire disconnected, the alternator will normally kick in by itself if you keep revving it up a fair bit and hold the revs for a moment, like say above 3,000 rpm. Once it's kicked in you can drive as normal. You'll need a voltmeter to know that it's kicked in, but if you're familiar with your engine you can often tell just by noting the alternator is placing a bit of a load on the engine or things like headlamps going brighter. You can maybe give that a try to see if I'm right.
I'll explain the red ALT charging light on the instrument cluster, which will help you figure out what's likely going on. The wire circuit goes like this, starting from the battery with the ignition switch on (KP-II), voltage passes through the indicator lamp directly to the D+ wire on the back of the alt, then to ground through the alternator, which illuminates the lamp. There is no fuse in the circuit. When the alternator charging circuit then engages, it changes the path to ground and the light goes off.
If the light won't illuminate in the first place then something along that wiring path is incomplete. Your job is to find that disconnection, which may be anywhere from the battery (cable connection or dead battery), the ignition switch (connectors or internal), the instrument cluster (connections, circuits or a burnt out bulb), or the alternator (connection at the back of the alt, the alt internally or the ground path from the alterntor), or damaged wiring anywhere along the way. Because you've had the engine out, there are two large block connectors that may be involved, one on the left fender up closer to the alt and the other at the left A-pillar (I forget at the moment if it's under the left strut brace in the engine compartment or up under the dash on the very left)
Switching the instrument cluster from a 940 into a 740 is probably not a great idea until you know it's the likely failure point. You're likely just complicating things as others mention.
If you can't spot a disconnection or damaged wire then you need to start fault tracing with a voltmeter or test light. A test light may be preferred to make sure enough amps can get through the circuit, also simpler to use as it as a probe. Starting by disconnecting the D+ wire and see if there's voltage between there and chassis ground when the ignition is on (KP-II). That will tell you whether it's an alternator issue or not. If not then the next best test point is at the instrument cluster connections. At that point a proper wiring diagram would become useful, otherwise you'll want to trace the board circuit out to the connector starting at the indicator bulb socket. If the '89 speedometer diagram I'm looking at is the same as yours then one wire os off an edge connector in the centre at the very bottom not far from the bulb that as I recall can become accidentally damaged during removal and installation. There's also a diode involved in the cluster that could be a problem, but I don't recall hearing much about that component failing.
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Dave -still with 940's, prev 740/240/140/120 You'd think I'd have learned by now
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