Up to 161 workers fear the loss of their jobs with the future of bus manufacturing in NSW at risk after a company in Western Sydney went into administration.

Custom Bus, which manufactures buses in Villawood, on Friday said it had gone into administration but would not confirm how many of its workers were being made redundant.

"We are still trading," a company spokeswoman said.

The Australian Manufacturing Workers' Union said it expected up to 161 employees could lose their jobs if the company is liquidated.

It said a skeleton crew of 56 staff were working on finalising a current order.