Study to Determine Fate of Panama Canal

As the date to relinquish control of the Panama Canal approaches, authorities in the United States, Panama and Japan – the canal’s second largest user – are studying ways to make the waterway more profitable and efficient in the next century.

Two studies are currently underway. The first, undertaken by the Panama Canal Commission – the U.S. agency that oversees operations – is a feasibility study on widening the canal. The final phase – a financial analysis – is expected to be completed by the end of the year at which time a recommendation will be made, according to Jane Pryor, a spokesperson for the commission.

The second study is being conducted by the Comission of the Study of Alternatives – comprised of representatives from the U.S., Panama and Japan. The five-year, $20 million study is designed to investigate ways of improving the canal or building an alternate route, Ms. Pryor said.

The alternatives being considered include building a sea-level canal; widening and deepening the canal; or making modest improvements such as rebuilding and lengthening the locks. Building pipelines and improved rail links also are being considered.

The most studied alternative to improving the existing canal is a shallow-draft, 135-mile waterway through Colombia and Panama. That option was most recently estimated at $1.6 billion. Estimates for other alternatives have run as high as $4 billion.

The study is just getting underway, however – the Commission is still accepting bids from consulting firms concerning the design and write-up of the study – until September 15, and a final decision is not expected until 1991.

The effect this will have on the cruise industry will depend on which alternative is chosen, although several spokespeople said that they expected to see as few disruptions to world shipping as possible.

Interest in TransCanal Cruises Growing

In the meantime, the Panama Canal is becoming an increasingly popular offering of the cruise lines, despite the fact that commission representatives said they do “absolutely no marketing” to the industry.

To date, 212 cruise ships have transited the canal in 1986 – compared to 135 in 1985. They have generated $6,7 million in revenues, up from $4.9 million last year.

For cruise liners, transiting the canal is expensive. The toll is $1.83 per canal ton, or $99,000 for a ship the size of the QE2. For the Royal Princess, which is 757 feet long and has a 95-foot beam, the toll was $67,139 in 1985.

Major Itinerary Embellishment

The cruise lines offering Panama Canal transits reported that the tolls were worth it, claiming that the crossing is a major drawing point. They also said transcanal cruises were becoming more popular each year.

“The transit is everything,” said Howard Fine, president of Costa Cruises. “Cruises that just touch the canal don’t work.”

Fine reported that Costa’s transcanal cruises have been sell-outs the last few years, but noted that demand is limited in this market.

“When we run a few transits, they generally sell out, but when we start running a lot, we find you get into trouble,” he said.

Sitmar’s 14-day transcanal cruises sold so well this year, that the line decided to add six more in 1987, reported Bill Smith, director of marketing for the line. That means that Sitmar will be offering a total of eight 14-day cruises in this market, in addition its regular schedule of 10- and 11-day transcanal sailings.

“The transit is the highlight of the cruise,” Smith said, noting that almost all of the passengers stay out on deck for the entire 12-hour crossing.

In the past, the transcanal cruises have attracted an older crowd, but in the last few years, there has been a shift to a younger clientele, Smith reported. “We’re seeing a lot of passengers in their 30’s and 40’s,” he said.

At Regency Cruises – the only line offering seven-day cruises in this market – the transcanal sailings have been very well received, according to Maury Rosenbaum, vice president of planning and communications.

“1985 was first season in this market, and we sailed at 95 percent occupancy. Right now, we are ahead of last year,” he said.

Rosenbaum attributes Regency’s success to the length of the cruises. “The seven-day market is bigger than the longer ones, and the shortened itineraries enable us to offer passengers a transcanal cruise at more affordable rates.”

Exploration Cruise Lines’ deviates from the norm by focusing on Panama, in addition to the canal. Offering passengers a choice of four- and five-day cruises, or an eight-day vacation with an add-on in Panama City, Exploration takes them to the Pearl Islands, the Darien Jungle, Colon, Porto Belo and the San Blas Islands.

“We are noticing an increasing interest in Panama as a destination among consumers and travel agents,” a spokesperson for the line said, noting that this is Exploration’s fifth year in this market. “Panama is a relatively new destination, and it is rich in cultural diversity.”

Last year, Exploration’s Panama cruises “really topped out,” the spokesperson said, and this year “is looking good at the outset.”

Other industry members were less enthusiastic about Panama as a destination.

“The best attraction is the canal,” Fine said. “Panama City may be of interest, but many travelers have expressed concerns about safety.”

“If Panama is going to develop as a destination, it is going to have to do something to promote itself,” Fine added. “There may be wonderful islands in the area, but someone has to tell the cruise lines and travelers about them.”

Sitmar’s cruises take passengers to the San Blas Islands, a stop that has turned into a major highlight, according to Smith. “However, if transcanal cruises are to be really successful, ports on either side of the canal – in Mexico or the Caribbean – have to be included,” he said.

All those interviewed agreed that the Pamama Canal will become increasingly popular. And as it does, they expect to see more ships, and more of a variety of itineraries emerge in the next few years.

Cruise Industry News Email Alerts

Cruise Industry News Email Alerts



Get the latest breaking cruise newsSign up.


60 Ships | 134,437 Berths | $41 Billion | View



  • Mkt. Overview
  • Supply Data
  • 200 Pages
  • PDF Download
  • 2027 Outlook
  • Order Today
2023 Annual Report


  • Industry Outlook
  • All Operators
  • Easy to Use
  • Instant Download
  • Order Today