Panama Canal Railway
The Panama Railway also operated a significant shipping line, connecting its service with New York and San Francisco. It ran a Central American line of steamships linking Nicaragua, Costa Rica, San Salvador, and Guatemala to Panama City. The shipping service was greatly expanded when canal construction began. Ships included the SS "Salvador", SS "Guatemala", SS "Cristobel", and , which became the first of the ships to cross the completed canal in 1914.
In 1904 the United States took over the license to build and operate the canal. The choice to use locks and an artificial lake (Gatun) meant that the old railway route from 1855 had to be changed because it followed the Chagres River valley, which would be flooded by the lake. Also, the railway would be extended and altered continuously for the building process. The stock of the Panama Railway Company, vital in canal construction, was entirely controlled by the United States Secretary of War.
Panama Canal Railway
By July 1852, the company had finished of track and reached the Chagres River, where an enormous bridge had to be built. The first wooden bridge failed when the Chagres rose by over in a day and washed it away. Work was begun on a much higher, , hefty iron bridge, which took more than a year to finish. In all, the company built more than 170 more bridges and culverts.
In January 1854, excavation began at the summit of the Continental Divide at the Culebra Cut, where the earth had to be cut from to deep over a distance of about . Several months were spent digging. Later the Panama Canal required years to cut through this area deeply enough for a canal. The road over the crest of the continental divide at Culebra was finally completed from the Atlantic side in January 1855, 37 miles (60 km) of track having been laid from Aspinwall (Colón). A second team, working under less harsh conditions with railroad track, ties, railroad cars, steam locomotives, and other supplies brought around Cape Horn by ship, completed its of track from Panama City to the summit from the Pacific side of the isthmus at the same time.