400 hp really isn't a "mild" hopup. Back when the Cummins dyno'ed 150-180 hp, 400 was considered stratospheric. Now that the 305 hp HO dyno's at 280, 400 doesn't look so far off. However, some things such as lift pump and turbo aren't bigger in proportion to the factory hp increase.
Back when the first gen came out in calendar year 1988 with 160 hp, it had a Holset turbo with 18. 5 sq. cm. turbine housing. Now the engine dynos 120-130 hp higher but uses a turbine housing less than half the area (9 sq. cm. ) This is done for emissions--to have immediate responsiveness and power to compete with other brands, a small housing is needed for instant spool up. This housing becomes the choke point at high power/boost, and especially under power at higher rpm. The 9 sq. cm. translates to a single pipe 1-1/3 of an inch in diameter. Given about a 1/16" wall thickness of most exhaust pipes, that means single exhaust of just under 1. 5" outside diameter tubing. Go tell a serious drag racer that you want to build a 400 hp engine (don't even bother to tell him that is at the WHEELS not the flywheel), and use 1. 5" single exhaust.
Hence, we cannot expect to control exhaust gas temperatures, and moderate the pumping losses on a high hp engine, with an HY35 turbo having a 9 sq. cm. exhaust housing. We are pushing it at about 325 hp at the wheels for sure. Depending on altitude, egt's of the stock HO can approach and even exceed 1300 deg. at that horsepower.
The challenge to turbo companies will be to increase the cross sectional area of the exhaust (turbine) without sacrificing too much ability to spool up the turbo. The compressor side must be big enough to flow more air than stock, and this increase further impairs spool up. Remember the HX-35 turbo in the 12 valve engine. When we reached the 260-280 hp lelvel, we replaced the wastegated 12 sq. cm. exhaust housing with a non-wastegated 16 sq. cm. housing to improve exhaust flow and lower exhaust gas temperatures. The downside was slower spool-up and if fueling was incresed to improve spool up, more smoke was produced during the process. With the 2003-2004 HO engine we are already at 280 hp stock, and are using a tiny 9 sq. cm. housing. We cannot expect to add a large amount of fueling (= horsepower) without making air system upgrades.