The coach, which had 44 passengers, uprooted and snapped in half several large trees when it ran off the road after being hit by the overtaking Mercedes heading south on a straight.
Four people were seriously injured in the accident, with two rescue helicopters summoned to transfer three patients to Dunedin Hospital.
The car's 68-year-old female driver, of Dunedin, was taken by ambulance to the Wanaka Medical Centre.
She was transferred to Dunstan Hospital yesterday.
Two female coach passengers aged in their 20s remain in Dunedin Hospital with whiplash-related neck injuries.
The 68-year-old passenger in the car sustained lacerations and suspected concussion in the crash.
The male coach driver sustained lacerations and bruising during the crash and was taken by ambulance, along with three coach passengers, to the Wanaka Medical Centre.
The remaining "severely shaken" coach passengers were taken to the Makarora Wilderness Resort cafe to recover and await replacement transport.
The group, predominantly backpackers aged in their 20s, huddled in front of the cafe and bar's fireplace, comforting each other and talking about their "scary experience".
Several young men kicked a football around in the car park outside, to relieve tension.
"It was really scary, like.
"We went into the trees and people were getting thrown around.
"When it stopped, we all got out of the bus and tried to help those injured and everyone else, as best we could," one of the young men told the Otago Daily Times.
Emergency services from Makarora, Lake Hawea and Wanaka rushed to the accident scene after the alarm was raised about 2.30pm on Saturday.
Lake Hawea Fire Brigade station officer Nick Davies said they arrived at the accident to be met by a chaotic scene of injured crash victims and shocked coach passengers milling about on the roadside.
Sergeant Aaron Nicholson, of Wanaka, said it appeared the Mercedes was in the middle of an overtaking manoeuvre when it made contact with the coach.
Both vehicles then veered right and off the road to smash into a ditch and the forest, he said.
The Otago Daily Times understands the car was following the coach for up to 15 minutes before it initiated its passing move on the shaded stretch of straight road.
The car is believed to have hit patches of ice and slid into the side of the coach, shunting the rear of the larger vehicle, before both ended up in the bush.
The coach was removed from the accident site, yesterday.
Police Commercial Vehicle Investigation Unit accident inspectors are conducting an inquiry into the cause of the crash.
