A company making electric vehicles is helping to put milk floats back on Britain's streets.

Smiths Electric Vehicles (SEV) has signed a single- source supply agreement with a national dairy, which wishes to remain anonymous.

The value of the contract is also a secret, but industry insiders estimate it will be worth about £1.7m.

Roy Stanley, chief executive of SEV's parent company, the Tanfield Group, said: "This goes to show there is still life in the dairy sector in terms of our product."

Under the deal, SEV will refurbish about 200 milk floats and provide spares for another 1,000.

SEV has also won an export order to supply 19 electric baggage handling vehicles to Air Canada, in a £600,000 deal.

The overall market for electric vehicles on airport aprons in North America is worth more than $2bn a year.

Mr Stanley said: "This is important for us because it is a reference point so people can see what we do.

"It is all about gathering momentum and getting credibility."

Aerial Access, once part of SEV, has already broken through in the US and in January announced £3m of orders for its aerial access platforms, destined for North America, Eastern Europe and Australia.

Last Monday, SEV announced it was to produce a model with a top speed of 35mph and a range of more than 60 miles.

It will be launched in May.

This was followed by a £500,000 order for baggage handling cars for John Lennon Airport, in Liverpool.

The contract wins are also good news for Tanfield's engineering division, Tanfield Holdings, which supplies components to SEV.

The group bought SEV for £3.2m last October and is transferring operations to the Tanfield Lea Industrial Estate, in Stanley, County Durham, where the Tanfield Group is based.