Panama Canal Railway

The Panama Canal Railway (PCR, Spanish: Ferrocarril de Panamá) is a railway line linking the Atlantic Ocean to the Pacific Ocean in Central America. The route stretches 47.6 miles (76.6 km) across the Isthmus of Panama from Colón (Atlantic) to Balboa (Pacific, near Panama City). Because of the difficult physical conditions of the route and state of technology, the construction was renowned as an international engineering achievement, one that cost US$8 million and the lives of an estimated 5,000 to 10,000 workers. Opened in 1855, the railway preceded the Panama Canal by half a century; the railway was vital in assisting the construction of the canal in the early 1900s. With the opening of the canal, the railroad's route was changed as a result of the creation of Gatun Lake, which flooded part of the original route. Following World War II, the railroad's importance declined and much of it fell into a state of neglect until 1998, when a project to rebuild the railroad to haul intermodal traffic began; the new railroad opened in 2001.

The original line was built by the United States and the principal incentive was the vast increase in passenger and freight traffic from the Eastern United States to California following the 1849 California Gold Rush. The United States Congress had provided subsidies to companies to operate mail and passenger steamships on the coasts, and supported some funds for construction of the railroad, which began in 1850; the first revenue train ran over the full length on January 28, 1855. Referred to as an inter-oceanic railroad when it opened, it was later also described by some as representing a "transcontinental" railroad, despite traversing only the narrow isthmus connecting the North and South American continents. For a time the Panama Railroad also owned and operated ocean-going ships that provided mail and passenger service to a few major US East Coast and West Coast cities, respectively.

Known as the Panama Railroad Company when founded in the 19th century, today it is operated as Panama Canal Railway Company (reporting mark: PCRC). From 1998 to 2025, it was jointly owned by then Kansas City Southern, now Canadian Pacific Kansas City, and Mi-Jack Products and leased to the government of Panama. On April 2, 2025, Canadian Pacific Kansas City and Mi-Jack Products sold the railway to APM Terminals, which is owned by Maersk. The Panama Canal Railway is primarily dedicated to freight transport, but it has also operated a passenger service between Panama City and Colón.

The Spanish improved what they called the Camino Real (royal road), and later the Las Cruces trail, built and maintained for transportation of cargo and passengers across the Isthmus of Panama. These were the main routes across the isthmus for more than three centuries. By the 19th century businessmen thought it was time to develop a cheaper, safer, and faster alternative. Railroad technology had developed in the early 19th century. Given the cost and difficulty of constructing a canal with the available technology, a railway seemed the ideal solution.

President Bolívar of La Gran Colombia (Venezuela, Ecuador, Panama, Colombia) commissioned a study into the possibility of building a railway from Chagres (on the Chagres River) to the town of Panama City. This study was carried out between 1827 and 1829, just as locomotives were being invented. Previously railroads used horses for motive power. The report stated that such a railway might be possible. However, the idea was shelved.

In 1836, United States President Andrew Jackson commissioned a study of proposed routes for inter-oceanic communication in order to protect the interests of Americans traveling between the oceans and those living in the developing Oregon Country of the Pacific Northwest. The United States acquired a franchise for a trans-Isthmian railroad; however, the scheme was disrupted by the economic downturn after the business panic of 1837, and came to nothing.

In 1838 a French company was given a concession for the construction of a road, rail, or canal route across the isthmus. An initial engineering study recommended a sea-level canal from Bahía Limón to the bay of Boca del Monte, 12 miles (19 km) west of Panama City. The proposed project collapsed for lack of technology and funding needed.

Following the United States' acquisition of Alta California in 1846, the Oregon Territory in 1848, and the discovery of gold in California in 1848, and with the prospective movement of settlers to and from the West Coast, the United States again turned its attention to securing a safe, reliable, and speedy link between the Atlantic and Pacific oceans. A transcontinental railroad across the North American continent would not be completed until 1869. In 1846 the United States signed a treaty with Colombia (then the Republic of New Granada) by which the United States guaranteed Colombian sovereignty over Panama and was authorized to build a railroad or canal at the Panamanian isthmus, guaranteeing its open transit.