School Bus Contracting in 2026: Fleet, Fuel, and Workforce Trends
Shifting fuel strategies, evolving workforce pressures, rising costs, and growing technology adoption define today’s transportation providers. Here’s what the data reveals about key issues shaping the contractor industry.
Fewer contractors plan to buy new buses for the upcoming school year, but of those who do have purchase plans, alternative fuel usage is again on the rise as traditional diesel remains unchanged.
Credit:
Student Transportation of America/School Bus Fleet
3 min to read
School bus contractors are adjusting to a changing industry as new pressures arise and others begin to ease. This year’s survey of both small and large private operators shows caution blending with innovation and modernization.
Here’s a look at what trends contractors from across North America reported this year.
What Trends Stood Out from This Year’s Survey Responses?
The largest contractors are generally getting larger, as mergers and acquisitions reduce competition.
There was a large gap in average fleet size across respondents this year. A few mega-contractors dominate volume, while most remain small to mid-sized.
The driver shortage continues to affect contractor fleets, though to a lesser extent than in previous years. Pay rebounded this year, crossing the $25/hour threshold.
Diesel remains dominant, though its use is not growing. Instead, we’re seeing much more diversification. Gasoline and propane usage both saw sizeable jumps in 2026. Electric adoption is still on the rise, but not by much, likely due to changes in federal funding and regulations.
New bus purchases are more uncertain compared to recent years, a likely result of fuel price volatility, general cost pressures, and policy uncertainty.
More drivers are represented by a union, with driver memberships jumping from 17% two years ago to 29% last year and 35% this year.
Technology adoption increased again, with over half of contractor fleets using parent apps, tablets, in-cab cameras, and predictive maintenance.
Operational challenges saw a sharp shift this year, as insurance and staffing topped contractors’ concerns, and supply chain strain fell off. In short, we appear to be moving from disruption management to cost and risk management.
Note: All data was compiled from qualified survey respondents at private contracting companies, collected in February and March 2026. To see your voice represented in these results next year, watch for announcements about 2027 survey dates and share your insight to help us identify challenges, opportunities, and report on the state of school bus contracting.
Contractor Fleet Size in School Buses: Average: 4,476 | Median: 86
School District Contracts: Average: 155 | Median: 7
Students Transported Daily: Average: 322,545 | Median: 8,500
Average Terminal Manager Salary (Annual):$72,952
Alternative fuel use increased again this year, with propane and gasoline gaining popularity more than electric. Diesel use remains the same, suggesting that fleets are seeking greater fuel diversity.
Credit:
School Bus Fleet
Of the 65% of contractors planning to buy new buses soon, diesel interest remains steady year over year. Electric saw slight growth, while propane continues to rise, up about 10 percentage points since 2024. The biggest shift is gasoline, which rebounded sharply after dropping last year (56% were interested in gasoline in 2024).
Credit:
School Bus Fleet
A trend reflected in our other surveys this year. Contractors also report that the driver shortage strain is easing. This year, no one reported desperate levels; severe reports dropped by half, and moderate shortages rose from 32% last year.
Credit:
School Bus Fleet
Pay for new drivers is back up after a dip in last year's results.
Credit:
School Bus Fleet
Union membership for school bus contractor drivers rises again this year, up from 29% last year and 17% the year before.
Credit:
School Bus Fleet
Supply chain issues dropped this year as the largest contracting headache. “Other” answers mentioned compliance with state mandates.
Credit:
School Bus Fleet
Technology in Contractor Fleets
Parent communication increased again this year, with over half (60%) of contractors using parent communication technology, up from 50% last year and 39% the year before.
Camera usage jumped this year, with 82% of contractors equipping all buses and 18% some buses with video surveillance. Last year, 69% of contractors had cameras installed across their entire fleet.
Tablet adoption is increasing again as more contractors report using mobile data terminals on their buses (12% have mobile data terminals on all buses, 53% on some, and 35% on no buses). Last year, 50% said they didn’t use any, compared to 69% the year prior.
71% of respondents said all or some of their buses are equipped with predictive maintenance technology. Last year, 56% did.
Transportation providers are shifting toward alternative fuels and more efficient technologies to reduce costs and environmental impact.
The industry is experiencing challenges such as driver shortages and the need for better training programs to meet evolving demands.
Increased operational costs, including those for fuel and labor, are prompting contractors to seek more efficient technologies and methods to maintain budgets.
Technology adoption is growing, with contractors implementing advanced scheduling, routing systems, and fleet management software to improve operational efficiency.
Understanding shifts in fuel strategies, workforce dynamics, and technology helps providers make strategic decisions to improve their services and manage costs effectively.
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