It is too narrow,enough that it won’t make through any switch. I’ve never had to do that to a loco and wasn’t really sure how people do that.
Most N scale diesel locos with external bearings use a single-piece axle tube, and integral gear and 2 half-axles with wheels mounted on them. There is usually enough side play between the wheelset and side frames that the half-axles and wheels can be spread out.
I, like rrjim1, like to disassemble the truck, adjust the gauge, verify that they are correctly gauged, then reassemble the truck. I also liek to add a styrene washers to prevent the wheels from accidentally being pushed back against the axle tube, making them narrow in gauge again. I usually need 0.010" or 0.015" thick washers. I make them in batches from a sheet styrene. I make them the same diameter as the axle tube with the hole slightly larger than the axle diameter. To install them I fully take the wheelset apart, then install the washer or washers (as needed) onto the half-axle at the back of the wheel, then I reassemble the wheelset.
I have also read that some modelers simply insert a knife blade between in the opening behind the wheel (in an assembled truck) and twist the knife to spread the wheels out. It is a bit of a brute way of doing this, but it works for them.