Trunk to wheel housing?

As you can see I have a little patch work to do here, if you look at the part on the right where the floor isn't rotted away you'll see a pretty big space, about a 3/8" gap. This space was filled with seam sealer or goo of some sort. Is there supposed to be a big goo filled gap all the way around the wheel house for some reason? or is this just a pathetic factory fit? In other words, should I make a similar patch or one that actually fits tight to the wheel housing?

DSC03257.webp
 
As you can see I have a little patch work to do here, if you look at the part on the right where the floor isn't rotted away you'll see a pretty big space, about a 3/8" gap. This space was filled with seam sealer or goo of some sort. Is there supposed to be a big goo filled gap all the way around the wheel house for some reason? or is this just a pathetic factory fit? In other words, should I make a similar patch or one that actually fits tight to the wheel housing?

DSC03257.webp

For the longest time I thought it was a concave surface U was looking at, it's hard to focus without something to register location. My cars are tight at that spot, no gap. There is putty or Gumbo pressed into the seem to seal it. It is spot welded from the factory so it's not air tight there.