TDK Corp. said Friday it is halting production of CD-R discs, videocassette tapes and floppy disks in the United States in the wake of slack demand, leading to a cut in its workforce to 250 from 580 at two U.S. plants.

The major Japanese electronics parts maker said it stopped production of CD-R discs at a plant in Georgia on March 31 and will terminate production of videocassette tapes there by the end of April.

TDK said it stopped production of audio cassette tapes and floppy disks at a plant in California on March 31.

The company has been losing money in its audio and video tape and CD-R business due to sagging market prices. To slash costs, TDK said it will outsource production of these products.

It will use the two U.S. plants as packaging and distribution centers for U.S. customers and for production of electronics parts.

While the company plans to transfer the production of audio cassettes to its plants in Germany and Thailand, procurement of other products will be outsourced, it said.

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