Tata Motors, which had previously flagged a "challenging external environment", said it closed some blocks at its Pune plant in Maharashtra. The company, India's top automaker by revenue, had last month posted a bigger-than-expected quarterly loss due to weak conditions at home and problems at its British luxury car unit.

Mahindra and Mahindra said on Friday its automotive segment, which makes passenger and commercial vehicles and spare parts, would cut production for 8-14 days at various plants during the second quarter.

The crisis has also hit smaller auto parts makers like Jamna Auto Industries Ltd. The company, whose customers include Tata Motors, General Motors and Toyota Motor, said on Thursday it might shut all its nine plants in August due to weak demand. Auto components manufacturers Bosch Ltd and Wabco India Ltd have already trimmed production amid the demand slump.

Slumping sales of cars and motorcycles are triggering massive job cuts in India's auto sector, with many companies forced to shut down factories for days and axe shifts. Initial estimates suggest that automakers, parts manufacturers and dealers have laid off about 3.5 lakh workers since April, Reuters reported this week.

The downturn - regarded by industry executives as among the worst suffered by the Indian auto industry - is posing a big challenge for Prime Minister Narendra Modi in his second term at a time when India's jobless numbers are climbing.

To revive the sector, which contributes more than 7 per cent to India's GDP or Gross Domestic Product, auto executives have called for tax cuts and easier access to financing for both dealers and consumers.

Passenger vehicle sales have dropped for nine straight months through July, with some automakers suffering year-on-year declines of more than 30 per cent in recent months.

Experts say that the fallout from the auto slump could be huge since the sector employs more than 3.5 crore people directly and indirectly, accounting for nearly half of India's manufacturing output.

Maruti Suzuki, India's biggest carmaker, cut its temporary workforce by 6 per cent over the past six months.