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Germany's Continental to end Mayfield tyre making

FRANKFURT, June 30 (Reuters) - Germany's Continental AG will stop making tyres at its Mayfield, Kentucky, plant by the end of this year to cut losses at its U.S. operations, the tyre maker said late on Tuesday.

The shutdown will affect about 827 jobs. It follows April's news of an output cut at the factory that is due to become effective in July and involved 200 job cuts.

Mixing and some warehousing operations will continue in Mayfield, Continental said in Tuesday's statement.

"We have been weighing our options at Mayfield for some time. We must remain cost-competitive in the market and our industry," said Martien de Louw, chief executive of Continental's U.S. tyre-making unit, in the statement.

"Unfortunately this was our only option, as Mayfield remains the highest cost plant for Continental," he added.

Continental said earlier this year its 2004 profits could be hit by the cost of restructuring its loss-making U.S. operations. It did not say what charges would arise from the Mayfield production stop.

Continental's tyremaking unit has almost 6,500 employees and operates six plants in North America. Production at the other sites will continue, it said.