Seventeen kilometres south of Puerto Varas, the Panamericana approaches a large bay – the Seno de Reloncaví – with snowcapped Volcán Calbuco and Volcán Osorno towering beyond. On its edge lies the administrative and commercial capital of the Lake District – PUERTO MONTT, founded by the same influx of German colonizers that settled Lago Llanquihue to the north. The city is strung out along the bay, with the central part of town located on a narrow flat area along the main Avenida Diego Portales, and much of the city crowding the hills behind it.
Puerto Montt is an important transportation hub, with buses to many Chilean and Argentinian destinations. It’s also a busy port, with a billion-dollar-a-year salmon farming industry, fishing and the embarkation point for long-distance ferry trips (see Ferries from Puerto Montt). Though even some of the locals refer to it as ‘‘Muerto Montt’’ (‘‘Dead Montt’’), on a sunny day, this gritty town is quite attractive, with snow-tipped volcanoes visible across the bay from the seafront promenade.