Getting around Panama is relatively easy compared with other Latin American countries, and major roads are well maintained and delightfully free of potholes, making it a good place to rent a car to get from destination to destination. In Panama City, taxis, including Uber, are the best way to get around: They’re cheap, and you don’t have to deal with the stress of chaotic city driving. You can also get around by bus or Central America’s first subway line, though these can be confusing for the passing tourist, not to mention dangerous. Panama City (except for the Casco Viejo neighborhood) isn’t the best place to explore on foot, since most major tourist attractions aren’t within walking distance from each other. 

If you’re traveling between cities or destinations, you can do so by bus, plane, or car. If you’re driving, most destinations will be off the paved and well-maintained Pan American Highway. Once you leave the highway, however, some secondary roads can be a bit rough. To enter or leave Panama City, you’ll take the Puente de Las Americas or the newer Puente Centenario. 

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By Plane 

Air Panama (tel. 316-9000) is Panama’s main local carrier, servicing most destinations in the country. Air travel is safe, quick, and relatively inexpensive. Check the website for schedules and fares. 

By Car 

Driving in Panama allows you the most flexibility and is the best way to see the country. It’s not the cheapest option, however: Renting a car costs about as much as it does in the U.S., and gas is a little more expensive. But self-driving allows you to enjoy the scenery, adhere to your own schedule, make pit stops, and visit destinations away from your hotel. Generally speaking, speed limits in Panama are about 60 to 80 kmph (35–50 mph) on major roadways and slower on secondary roads. You’ll want to stick to this limit, as police speed traps are common, and you don’t want a speeding ticket to put a damper on your trip. 
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Car-rental kiosks are located at both the Tocumen and Albrook airports (car-rental agencies at Tocumen are open 24 hrs.; Albrook rental agencies are open 8am–6:30pm), and each agency has a few locations in town. The Tocumen Airport car-rental agency contact information is as follows: Alamo (tel. 236-5777), Avis (tel. 238-4037), Budget (tel. 263-8777), Dollar tel. 270-0355), Hertz (tel. 301-2611), and National (tel. 275-7222). 

When renting a car in Panama, you must purchase two basic insurances. The agency will also offer a variety of other full-coverage options, but generally, your credit card rental insurance should cover you, and you really only need the obligatory insurances. 
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Keep in mind that, depending on your destination, it’s sometimes better to get a four-wheel-drive (4WD) vehicle, because some of Panama’s roads are unpaved and rocky. If you’re staying close to Panama City or all your planned destinations are right off the Pan American Highway, you should be fine with a two-wheel-drive. 

Although most Panamanians drive stick-shift vehicles, automatics are readily available at all car-rental agencies, though you should expect to pay a bit more. Generally speaking, renting a car in Panama can cost you between $20 and $80 a day, depending on the kind of car and how you reserve. For the best deals, book through an online agency, such as Expedia, Hotels.com, or Kayak.com. You can also book directly through the car-rental agency’s websites, since booking ahead of time generally gets you a better rate. The agency will provide a road map upon car rental.
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Some distances are as follows: 

Panama City to Colón: 1 hour

Panama City to Gamboa: 25 minutes

Panama City to Portobello: 1 1⁄2 hours

Panama City to Cartí: 3 hours

Panama City to Boquete: 7 hours

Panama City to the Azuero Peninsula: 7 hours 

There are also car-rental agencies in David, Colón, and other popular tourist destinations. 

By Bus 

Bus routes between major and minor destinations in Panama are frequent and relatively inexpensive. Expect to pay about $3 to $5 per hour, depending on your destination. Bus travel between cities is relatively cheap but slower than driving. Nearly all buses from Panama City to other destinations depart from the bus terminal (tel. 303-3030) near Albrook Airport and adjacent to the Albrook Mall. It’s not necessary to reserve your tickets ahead of time unless you are traveling on a holiday weekend or during December or Easter week. Be sure to arrive at the terminal at least 45 minutes ahead of time. You’ll need a nickel to get on the bus, so make sure you have change. Long-distance buses are air-conditioned and comfortable, have an onboard bathroom, and usually show several movies. Shorter routes tend to use smaller, less comfortable buses, but are usually air-conditioned. If your route is 4 or more hours, the driver will make a pit stop about halfway through for lunch or dinner. 
 
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Note: This information was accurate when it was published, but can change without notice. Please be sure to confirm all rates and details directly with the companies in question before planning your trip.