A NICHE firm providing dual control hire vehicles to driving schools is to create jobs after receiving a cash boost from a business development fund.

Car2U, is also expanding its fleet after receiving the £135,000 investment from the Finance for Business North East Accelerator Fund.

The £20m accelerator fund, managed by Northstar Ventures, is one of seven under the banner of the £125m Finance for Business North-East super fund, aimed at helping businesses at an early stage of their development.

The company, based in Washington, on Wearside, and established 18 months ago, supplies dual-control cars and 4x4s or commercial vehicles with tow bars, on a daily-hire basis, to driving schools and accident management companies.

End-users are mainly clients of accident management companies whose vehicles are off the road due to a traffic accident, or are in need of major mechanical repairs.

As well as buying new vehicles, the investment will create a number of back-office and sales jobs.

The remainder of the funding will be used to further develop computer software used by the firm, which sees handheld equipment carried by its delivery drivers updated in near real-time to ensure vehicle availability, minimise paperwork, improve efficiency and help to reduce CO2 emissions.

The company's managing director, Gillian Frary, said: "We have invested a lot of time and money in this software which helps us better manage the business and deliver a very high standard of service to customers by providing them with near real-time electronic information.

"In this sector, customer service is paramount - and this is reflected in the fact the business has already performed well since we started it in February last year.

"This new investment gives us the opportunity to broaden our fleet, offer new and existing customers a better range of vehicles and help us maintain our levels of customer service."

Rebecca Crawford, of Northstar Ventures said, "We are delighted to be working alongside Car2U.

"It is a very exciting, young company based in the NorthEast, and has a great opportunity for growth within the market. Our investment will help it to expand its fleet and workforce, enabling it to operate at its full potential."