Automakers in India are down on their luck. Monthly sales data for July released by companies on Thursday showed the industry-wide slump continues. According to the figures , the cumulative sales of India’s top five passenger vehicle manufacturers—Maruti Suzuki India, Hyundai Motor India, Honda Cars India, Mahindra & Mahindra, and Toyota Kirloskar Motor—in July dropped 30.6% to 172,992 units.

The country’s largest carmaker, Maruti Suzuki India, saw its domestic passenger vehicle sales fall 36% to 98,210 units from 154,150 units a year ago, its lowest sales since June last year when it sold 93,263 units.

The company, which rode on the popularity of its compact cars, attributed the slump to a 38% decline in sales of mini and compact car models, including the WagonR, Baleno, Swift, and Dzire. According to a stock exchange filing, the sales of Alto and WagonR alone fell 69.3% to 11,577 units, from 37,710 units in July last year.

The Delhi-based firm also reported its worst quarterly drop in sales since 2001; sales during the April-June quarter fell 23.2% to 474,487 units from 617,990 units a year ago.

While it is not the only carmaker to bear the brunt of the slowdown facing the industry for more than 12 months now, it is probably one of the worst hit.

Hyundai Motor India, too, faced a similar fate in July. Its sales fell 10% to 39,010 units compared to July last year. Even utility vehicle market leader Mahindra & Mahindra reported a 15% drop in sales to 16,831 units. Honda Cars India also suffered a sharp 48% slump to 10,250 units; last July, Honda registered high sales volumes, backed by the launch of the second-generation Amaze. The Indian arm of Toyota also recorded a drop of 24% to 10,423 units in July this year.

The automobile industry in the country is facing headwinds due to weak demand, change in emission norms, fewer model launches, and low sentiment. The Automotive Component Manufacturers Association of India (ACMA) had suggested a uniform 18% GST (goods and services tax) rate across the entire auto and auto component sector for a revival.

ACMA feels there is an urgent need for government intervention to kick-start a long-term growth cycle for the auto and auto component industry that employs nearly 5 million people. ACMA says almost 1 million jobs could be on the line if the prolonged slowdown in the industry continues.

“The automotive industry is facing an unprecedented slowdown. The vehicle sales in all segments have continued to plummet for the past several months. Considering the auto component industry grows on the back of the vehicle industry, a current 15 to 20% cut in vehicle production has led to a crisis like situation in the auto component sector. If the trend continues, an estimated 1 million people could be laid off,” said Ram Venkataramani, president of ACMA.

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