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UPDATE 1-India's passenger vehicles sales sink for ninth month in July

Aditi Shah

(Adds details on sales declines, background and context)

NEW DELHI, Aug 13 (Reuters) - India's domestic passenger vehicle sales fell for the ninth straight month in July, an auto industry body said on Tuesday, amid a deepening crisis in the country's automobile sector that has triggered large-scale job losses.

Sales of passenger vehicles to car dealers fell 30.9% to 200,790 in July, data released by the Society of Indian Automobile Manufacturers (SIAM) showed. Commercial vehicles sales fell 25.7% to 56,866 units, SIAM said.

Motorcycle and scooters sales fell 16.8% to about 1.51 million units, while passenger car sales fell 36% to 122,956 units, the data showed.

The data also showed that domestic passenger vehicle production was down nearly 17% in the month.

"The data shows urgent need for a revival package from the government. The industry is doing everything possible to increase sales but it needs government support to prevent the crisis from worsening," Vishnu Mathur, director general of SIAM, told reporters in New Delhi.

India's S&P BSE auto sector index has fallen 23% this year, with the country's top automaker Maruti Suzuki's market valuation falling 18.3% since the beginning of this year.

The fall in car sales comes at a time when demand for consumer goods is falling and what is seen as a major sign of an economic slowdown in India, amid a liquidity crunch in the country's shadow banking sector that has impacted the availability of credit in the market.

India's auto sector is cutting tens of thousands of jobs citing slumping sales of cars and motorcycles, with many companies forced to shut down factories for days and axe shifts.

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

The domestic auto industry demanded tax cuts and easier access to finance for dealers and buyers at a meeting with Indian government officials last week to discuss the sector's woes, in an effort to revive sales that have slumped.

($1 = 71.0950 Indian rupees) (Reporting by Aditi Shah; Writing by Sudarshan Varadhan; Editing by Euan Rocha and Rashmi Aich)