Panama Canal Railway Company

1. Panama Canal Railway Company Katherine Meyers& Tingyu Liu

2. Welcome to Panama Canal Railway Company • Introduction • History • Current Status • Travel Info • Interesting Facts • Operation • Answer Each team’s Questions

3. Introduction Kansas City Southern Mi-Jack Products Panama Canal Railway Company (PCRC) Panarail Tourism Company

4. Introduction Colon Panama City

5. History Construction began in 1850 The Project cost $6,564,552.95 On Jan 28, 1855, the first train crossed the Isthmus

6. Current Status • Owned by Kansas City Southern and Mi-jack Products, who were awarded a 50 year concession to rebuild/operate the railway(1998) • $80 million invested in improvements • Caters to business executives and tourists • Capacity to transport 500,000 containers/year with expected increases of 250,000/year, until reach max. of 2 million TEU

7. Unique Passenger Cars • Each of the 5 passenger cars are named after a river in Panama: Rio Indio, Rio Pequeni, Rio Gatun, Rio Mamoni and Rio Bayano • 1938 Southern Pacific Dome Car, named Rio Chagres, that was remodeled at a cost of $1 million • Each car holds 50 passengers

8. Interesting Facts • Total more than 12,000 people died in the construction, the Railroad started “pickling” the bodies in barrels to be sold to medical schools • During the first 12 years of operation, the railroad carried over $750,00,000 in gold dust, nuggets and gold and silver coins • At $295 a share, the railroad was at one time the highest priced stock on the New York Stock Exchange • Panama canal railway is the most expensive railroad ever built

9. Travel Info. • Travel Time: 1 hour • Monday-Friday • Departure time from Panama to Colon: 7:15 am • Departure time from Colon to Panama: 5:15 pm

11. Operation • Capacity for ten trains each direction every 24 hourswith possibility to increase to 32 run/day • Operates double-stack bulkhead type rail cars in two sets of six, each set accommodating an average of 75 containers • 47mile single-line track with few locations for 2 way traffic • Lift equipment able to lift 90,000 pounds

12. Operation

13. Answer Each Teams’ Questions Team 1 What is the annual usage of the Panama Railway and has it been increasing or decreasing over time? Answer: • In our opinion, the annual usage of the PCRC has been increasing. • Because technologic improvement makes transportation and travelling become easier

14. Answer Each Teams’ Questions Team 2 How is the railroad company going to be affected by the Panama Canal expansion in the next few years? Answer: • In our opinion. traffic volume will be affected by the Canal and decrease slightly • The railroad transportation will not be replaced • The railroad is used for commuters going to work and the canal expansion has increased the number of jobs so it is possible the number of passengers has gone up lately

15. Answer Each Teams’ Questions Team 3 What is the competitive advantage of the railway over the canal? Answer: • Alleviate Canal restriction related to draft, line of sight or vessel size • Cargo can be transshipped from coast to coast duty free

16. Answer Each Teams’ Questions Team 4 1, What is the primary revenue for the Panama Railway Company today? Passenger or goods transport? 2, Is this a shift from what has been truein the past? Answer: • In our opinion, goods transportation is primary.

17. Answer Each Teams’ Questions Team 6 1, Is this railroad predominantly used for commercial shipping or for passenger transport?2, What would be cheaper solution to ship items in panama? The railway or the canal? Answer: • We will find out during visit.

18. Reference • http://www.panarail.com/ • http://www.mi-jack.com/ • Kansas City Southern Notice and Proxy Statement for Annual Meeting of Stockholders, May 3,2012

19. Thank you!