You can see big plumes of smoke as the bus caught on fire.
More than 40 students from Aptos Junior and High schools were on board.
An image by the California Highway Patrol Santa Cruz shows severe front end damage to the car and fire damage to the bus.
At least one student was injured, but is expected to be ok.
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The driver of the car was handcuffed by police and taken to a local hospital.
Officers say it appears drugs and alcohol were not a factor.
The crash is still under investigation.