I was also confused, and I'm a native speaker. Understanding that "rather" means "prefer" is obvious.

The sentence could be read as "I prefer to be on the road with a bus since I think it's safer". Or it could be "choosing what's most dangerous, I'd rather say it's a bus".

It's also not clear what the perspective of the speaker is. It might be that a bus is safer for the rider, but more dangerous for cars around it. So would he rather be on board a bus, or rather on the road with a bus?