My dictionary says, if it's not a physical medal, it's an "oval or circular design." It's true that PFE for a few years used metal plates for this purpose, but SP never did, to my knowledge, and SP likewise called their emblem a medallion (so identified on lettering drawings). I think it is not correct to try and insist it connotes a physical object. Round designs called medallions are used in decorations such as carpets and textiles.

Tony Thompson             Editor, Signature Press, Berkeley, CA

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I just looked at some of the SP lettering diagrams from the early 1900's.  They clearly indicate that the medallion be painted on the car.  There were lettering diagrams for the medallions, in this case they were 5'4" across.  Not only did they cover the familiar sunset medallion - with Southern Pacific spelled out between the two concentric circles, the center bar with sunset route on two lines with the sun above and the rails below,  also included were medallions for the Houston & Texas Central, Houston East & West Texas and San Antonio and Aransas Pass.

So this large circular object painted on the side of the car was clearly called a medallion.  The medallion was not painted on some other object that was attached to the side of the car.  Photos of cars lettered with this lettering scheme clearly show that the medallion was painted on the side of the car.  A number of these are shown in the SP Freight car book on box cars.