Bosses at R & B Travel will stop running the 701 and 722 town centre services on January 25, and as yet no replacement is in place to fill the gap.
Alan Radnor, partner at R & B Travel, said: "We have given notice that we are going to stop running the service. Unfortunately it will mean two or three of the drivers will lose their jobs.
"We'd be willing to do it if we were paid a reasonable amount, but we haven't been given a chance to do it subsidised."
"We've been doing the Ludlow town service for 15 years or so now. We want to keep doing it, but we can't keep doing it at a loss."
Councillor Vivienne Parry said she had been told Shropshire Council could have a replacement in place within two days, but there was no guarantee what kind of service it would be.
"I'm concerned about how this will affect my old ladies in the town," she said.