There are fears that new requirements to upgrade busses could reduce Lincolnshire services and increase the cost of school contracts.
The Government moves in January will mean companies must provide digital route and timetables, install contactless ticket machines and ban “non accessible” coaches.
Senior councillors predict the spend could be around £10,000 per vehicle and one local company has reported spending £200,000 already.
Lincolnshire County Council’s highways committee heard concerns small and independent companies will struggle to afford the costs, leading to reduced services or companies closing all together.
Executive member for transport Councillor Richard Davies emphasised the effect this could have on competition.
“We’re seeing the market shrinking, companies across the East Midlands and the country are saying we don’t make as much money as we used to so we’re going to do other things,” he said.
“So we’re seeing the number of companies reduce. Not only does it lead to less busses on the routes, but when we go to companies for tenders for school services, adult social care etc that we try to keep our key communities linked, there aren’t as many companies to do it.”
Councillor Davies added companies were not making enough money to fund what could be £10,000 per vehicle.
Lincolnshire County Council has subsidised several services, and purchased ticket machines which can be leased out to companies.
The council’s own company Transport Connect is also working to bring some competition for the market.
Brylaine Busses, based in Boston, spent £200,000 upgrading their system to Ticketer nearly three years ago.
A spokesman said it had been beneficial – particularly with regards the health and safety of the school runs – with nearly 2,000 of their 3,000 riders registered.
However, they were unconvinced digital systems would improve footfall in the rural areas of the county.
They said: “This is a rural environment, so you’re limited on footfall and you’ve got a very specific people who use the bus because they have to use the bus.
“You won’t be able to increase footfall unless you extend the service, and there’s no funding for that.”