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.
Health measures during the construction of the Panama Canal
By the time the United States took control of the Panama Canal project on May 4, 1904, the Isthmus of Panama was notorious for tropical diseases. An estimated 12,000 workers had died during the construction of the Panama Railway and over 22,000 during the French effort to build a canal. Many of these deaths were due to disease, particularly yellow fever and malaria. At several times, construction on the Panama Railway had actually halted due to the lack of healthy workers.