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Consulting Engineers - UK - September 2015

Consulting Engineers - UK - September 2015

“The reform of the Highway Agency, now known as Highways England, should give contractors and consultants the confidence to recruit and train the skilled workers required to deliver the increase in transport projects over the coming years. The reform should also result in quicker, more efficient delivery, as work will not need to deal with the threat of funding being removed, as was occasionally the case when annualised budgets were applied.”

– Claudia Preedy - B2B analyst

This report addresses the following key questions concerning the market for UK Consulting Engineers:

How has the market for UK consulting engineers performed over the last five years?
How strongly will the market develop over the next five years?
What is the impact of the legislative/regulative environment on individual sectors?
Which sectors will provide the strongest growth potential for consulting engineers over the next five years?
How have individual key companies active in the industry faired during the last five years?


EXECUTIVE SUMMARY
The market
UK consulting engineers’ fees income up by a modest 1% in 2014
Figure 1: Total fees rendered by UK Consulting Engineers. By Sector, 2010-14
Government’s renewed focus on infrastructure investment to provide a positive impetus for the sector
Road and rail most important areas for consulting engineers’ fees income
Power and energy sector has offered strong opportunities for consulting engineers in recent years
Market for UK consulting engineers anticipated to grow by 21% between 2015 and 2019
Private sector to drive infrastructure investment growth
Figure 2: Forecast Market for UK Consulting Engineers, 2015-19
Demand structure
Transport to remain largest sector for consulting engineers
Transition to low carbon economy drives demand in power/energy sector
Figure 3: Forecast Market for UK Consulting Engineers in the Power and Energy Sector, 2015-19
Shift in focus from capital investment towards asset maintenance in water and sewerage
Development of industrial construction output to remain above GDP growth over the next five years
Figure 4: Forecast Segmentation of the Fees Rendered by UK Consulting Engineers in the Building
Sector, 2015-19
Companies
What we think
KEY INSIGHTS
How are plummeting oil prices impacting investment in the North Sea oil and gas
infrastructure?
How will consultants and contractors benefit from the reform of the Highways Agency?
The energy sector is set to be a key driver for consulting engineering work over the coming
years, but have any uncertainties in the sector’s outlook started to emerge?
What is the outlook for consulting engineers in the water and waste water sector? What
are the key challenges in the sector?
INTRODUCTION
Definitions
Methodology
Abbreviations
Market positioning
Market factors
UK ECONOMY
Overview
Figure 5: UK GDP quarterly development, 2003-15
Figure 6: UK GDP in economic downturns and recoveries since 1979
Inflation
Interest rates
House prices
Consumer spending
Manufacturing
Business investment
Figure 7: UK GFCF 2003-15
Imports
Exports
MARKET OVERVIEW
Key points
Market size
Figure 8: Total Fees Rendered by UK Consulting Engineers, 2010-14
Figure 9: Total Fees rendered by UK Consulting Engineers, 2010-14
Market segmentation
Key sectors
Figure 10: Analysis of Fees Rendered by UK Consulting Engineers, by Industrial Sector, 2010-14
Figure 11: Proportional Importance of Key Sectors of Consulting Engineers’ Income, 2014
Market forecast
Figure 12: Forecast Market for UK Consulting Engineers, 2015-19
Figure 13: Analysis of Forecast Fees Rendered by UK Consulting Engineers, by Industrial Sector, 2015-
19
Figure 14: Forecast of Fees Rendered by UK Consulting Engineers, by Industrial Sector, 2015-19
BUILDING & CONSTRUCTION SECTOR
Key points
The market
Figure 15: Fees Rendered by UK Consulting Engineers in the Building Sector, 2010-14
Market segmentation
Figure 16: Segmentation of the Fees Rendered by UK Consulting Engineers in the Building Sector,
2010-14
BUILDING & CONSTRUCTION MARKET FACTORS
Key points
PFI sector
Industrial construction
Figure 17: Long term trend in private industrial construction output in Great Britain, 1970-2014
Figure 18: Analysis of private industrial new construction work in Great Britain, by sector 2010-14
Industrial construction forecast
Figure 19: Forecast private industrial construction output in Great Britain, 2015-19
Figure 20: Forecast of private industrial new construction work in Great Britain, by sector 2015-19
Commercial construction
Figure 21: Long term trend in private commercial construction output in Great Britain, 1970-2014
Figure 22: Analysis of private commercial construction in Great Britain, by type, 2010-14
Commercial construction forecast
Figure 23: Forecast private commercial construction output in Great Britain, 2015-19
Figure 24: Forecast of private commercial construction in Great Britain, by sector, 2015-19
Public non-residential construction
Figure 25: Long term trend in public non-residential construction activity in Great Britain, 1970-2014
Figure 26: Analysis of public sector non-residential construction output in Great Britain, 2010-14
Figure 27: Analysis of public sector non-residential construction in Great Britain, by type, 2010-14
Health
Education
“Other” sector
Public non-residential construction forecast
Figure 28: Forecast public non-residential construction output in Great Britain, 2015-19
Figure 29: Forecast of public non-residential construction in Great Britain, by type, 2015-19
BUILDING & CONSTRUCTION SECTOR FORECAST
Key points
Market forecast
Figure 30: Forecast of Fees rendered by UK Consulting Engineers in the Building Sector, 2015-19
Figure 31: Forecast of Fees rendered by UK Consulting Engineers in the Building Sector, 2015-19
Figure 32: Forecast Segmentation of the Fees Rendered by UK Consulting Engineers in the Building
Sector, 2015-19
TRANSPORT SECTOR
Key points
The market
Figure 33: Fees Rendered by UK Consulting Engineers in the Transport Sector, 2010-14
Figure 34: Fees Rendered by UK Consulting Engineers in the Transport Sector, 2010-14
Market segmentation
Figure 35: Segmentation of the Fees Rendered by UK Consulting Engineers in the Transportation
Sector, 2010-14
TRANSPORT MARKET FACTORS
Key points
The National Infrastructure Plan
Roads
Figure 36: Road Network in Great Britain, by Type, 2014
Figure 37: Road Network Expenditure in England, by Activity and Road Type, 2010/11-2012/13
Figure 38: New Construction and Improvements of Roads, Motorways and All Purpose Trunk Roads, in
England, 2009/10-2013/14
Figure 39: Civil engineering new road construction output in Great Britain, 2010-14
Figure 40: Civil Engineering New Road Construction Output in Great Britain, 2010-14
Road sector forecast
Reform of Highways Agency
Figure 41: Forecast Civil Engineering Construction Output for the Roads Sector, 2015-19
Rail
Figure 42: Rail infrastructure in Great Britain, 2010-14
Figure 43: Rail infrastructure in Great Britain, 2010-14
Figure 44: Rail industry infrastructure activity, 2009-14
Figure 45: Major rail infrastructure projects delivered during CP4, 2009-14
Figure 46: Rail infrastructure renewals, enhancements & maintenance expenditure in Great Britain,
2010-14
Figure 47: Renewal expenditure by asset, 2010-14
Figure 48: Private sector investment in track and signalling, 2010-14
Figure 49: Private sector investment in stations, 2010-14
Figure 50: Analysis of enhancement expenditure in England and Wales, by type, 2010-14
Figure 51: Analysis of Enhancement Expenditure in Scotland, by Type, 2010-2014
Figure 52: Analysis of enhancement expenditure on non-PR08 funded schemes by type, 2010-14
Rail Civil Engineering Construction Output
Figure 53: Civil Engineering Construction Output for the Rail Transport Sector in Great Britain, 2010-14
Rail sector forecast
Figure 54: Rail infrastructure projects pipeline, as of December 2014
High speed rail network (HS2)
Proposed new rail lines
Maintenance expenditure in CP5
Figure 55: Forecast rail maintenance expenditure for CP5, 2014/15-2018/19
Figure 56: Forecast rail maintenance expenditure for CP5, 2013/14-2018/19
Figure 57: Forecast rail maintenance expenditure for CP5, by Activity, 2014/15-2018/19
Capital expenditure in CP5
Figure 58: Forecast capital expenditure for CP5, by type, 2014/15-2018/19
Figure 59: Forecast capital expenditure for CP5, by type, 2014/15-2018/19
Renewals expenditure in CP5
Figure 60: Forecast rail renewals expenditure for CP5, by activity, 2014/15-2018/19
Figure 61: Forecast rail track renewal activity for CP5, by activity, 2014/15-2018/19 and CP5 total
Figure 62: Forecast rail structures renewal for CP5, by activity, 2014/15-2018/19
Figure 63: Forecast rail electrification & plant renewal for CP5, by activity, 2014/15-2018/19
Figure 64: Forecast building renewal for CP5, by activity, 2014/15-2018/19
Enhancements expenditure in CP5
Figure 65: Cost of enhancement projects during CP5
Figure 66: Forecast Civil Engineering Construction Output for the Rail Sector, 2015-19
Ports, airports, harbours & canals
Recent port expansion projects
Figure 67: Civil engineering construction output for the harbours and waterways sectors in Great Britain,
2010-14
Figure 68: 10 largest airports in the UK, 2009-14
Figure 69: Civil engineering construction output for the air transport industry in Great Britain, 2010-14
Figure 70: Civil Engineering Construction Output for the Air Transport Industry in Great Britain, 2010-14
Ports, Airports, Harbours & Canals Sector Forecast
Growth in off-shore wind farm developments offers opportunities to UK ports
Figure 71: Forecast civil engineering construction output for the harbours sector, 2015-19
Figure 72: Forecast civil engineering output for the airport transport sector, 2015-19
TRANSPORT SECTOR FORECAST
Key points
Market forecast
Figure 73: Forecast UK Market for Consulting Engineers in the Transport Sector, 2015-19
Figure 74: Forecast Segmentation of the Fees Rendered by UK Consulting Engineers in the Transport
Sector, 2015-19
Figure 75: Forecast Segmentation of the Fees Rendered by UK Consulting Engineers in the Transport
Sector, 2015-19
ENVIRONMENT, WATER, WASTE WATER AND WASTE
Key points
The market
Figure 76: Fees Rendered by UK Consulting Engineers in the Environment, Water, Waste Water,
Waste, Flooding and Coastal Sector, 2010-14
Figure 77: Fees Rendered by UK Consulting Engineers in the Environment, Water, Waste Water,
Waste, Flooding and Coastal Sector, 2010-14
Market segmentation
Figure 78: Segmentation of the Fees Rendered by UK Consulting Engineers in the Environment, Water
& Waste Water and Waste Sector, 2010-14
ENVIRONMENT, WATER, WASTE WATER AND WASTE MARKET FACTORS
Key points
Market factors
Potable Water & Sewerage Industry
European Water Framework Directive (WFD)
Urban Waste Water Treatment Directive (UWWTD)
The Drinking Water Directive
Revised Bathing Water Directive
The Flood and Water Management Act 2010
Move towards total expenditure in current planning period AMP6
Move towards long-term alliances and frameworks across industry
Water & sewerage capital expenditure
Figure 79: Actual UK capital expenditure on water and sewerage services, 2009/10-2014/15
Figure 80: UK capital expenditure on water and sewerage services, 2009/10-2014/15
Figure 81: UK Capital Expenditure on Water and Sewerage Services, 2009/10-2013/14
Sewerage-related capital expenditure
Figure 82: Analysis of sewerage-related capital expenditure in England and Wales, by company,
2008/09-2013/14
Figure 83: Analysis of sewerage-related capital expenditure, by water and sewerage companies in
England and Wales, 2008/09-2013/14
Water-related capital expenditure
Figure 84: Analysis of water related capital expenditure, by water and sewerage companies in England
and Wales, 2008/09-2013/14
Figure 85: Analysis of water-related capital expenditure, by water and sewerage companies in England
and Wales, 2008/09-2013/14
Figure 86: Analysis of Scottish Water capital expenditure on water and sewerage services, 2009/10-
2013/14
Figure 87: Progress of Scottish Water to Date in the Five Year Investment Programme 2010/15
Figure 88: Analysis of Northern Ireland Water capital expenditure on water and sewerage services,
2009/10-2013/14
Investment plans by water and sewerage companies in England and Wales
Figure 89: Forecast capital expenditure for AMP6 in England & Wales, by water & sewerage company,
2015/16-2019/20
Figure 90: Forecast capital expenditure for AMP6 in England & Wales, by water & sewerage company,
2015/16-2019/20
Figure 91: Forecast capital expenditure for AMP6 in England & Wales, by water only company, 2015/16-
2019/20
Thames Tideway Tunnel
Scotland Investment Programme 2015-2021
Figure 92: Forecast Capital Expenditure for Scottish Water, 2015/16-2020/21
Northern Ireland Investment Programme 2015/16-2020/21
Waste management
Figure 93: Waste Arisings in the UK, by Source, 2010-2014, (Million Tonnes)
Flood defences
ENVIRONMENT, WATER, WASTE WATER AND WASTE FORECAST
Key points
Market forecast
Figure 94: Forecast Market for UK Consulting Engineers in the Environmental Sector, 2015-19
Figure 95: Forecast Market for UK Consulting Engineers in the Environmental Sector, 2015-19
Figure 96: Forecast Segmentation of the Fees Rendered by UK Consulting Engineers in the
Environmental Sector, 2015-19
POWER AND ENERGY SECTOR
Key points
The market
Figure 97: Fees Rendered by UK Consulting Engineers in the Power and Energy Sector, 2010-14
POWER & ENERGY MARKET FACTORS
Key points
Oil & gas
Further reforms to encourage investment introduced in 2015
Oil & gas reserves
Capital expenditure in oil & gas industry
Figure 98: UK Total Capital Expenditure in the Oil and Gas Industry, by Type, 2009-13
Figure 99: UKCS Oil and Gas Production Platforms and Floating Installations, 2014
Future Investment in Oil & Gas Industry
Slump in oil price proves highly detrimental to North Sea oil industry
Electricity
Electricity market reform
The UK Electricity Generation Mix
Figure 100: Analysis of electricity supplied in the UK, by type of fuel used in generation, 2010-14
Figure 101: Composition of electricity supplied in the UK, by type of fuel used in generation, 2014
Renewables generation
Government subsidy cuts are raising uncertainties for renewables industry
Offshore wind
Figure 102: Renewable electricity generation in the UK, 2010-14
Figure 103: Renewable Energy Projects in Pipeline, by Technology, as of July 2015
Coal generation
Nuclear generation
Figure 104: UK Nuclear Sites Planned Closure Dates, as of September 2015
CCGT
Distributed generation
Interconnectors
Figure 105: Existing and planned interconnectors, as of November 2014
Gas supply
The UK’s increased reliance on gas imports
Potential for shale gas extraction
Wholesale gas prices
Figure 106: Average wholesales gas prices, 2002-14
Gas transmission and distribution capital expenditure
Figure 107: Total gas transmission and distribution capital expenditure, 2009/10-2013/14
Figure 108: Total gas transmission capital expenditure, 2009/10-13/14
Figure 109: Total gas distribution capital expenditure, 2009/10-2013/14
Figure 110: Cumulative capital expenditure during GDPRC1 2008-13, by GDN and type
Forecast capital expenditure
Transmission network
Figure 111: Capital Expenditure Plans by National Grid Gas Under RIIO-T1, by Category, 2014-2021
Figure 112: Annual capital expenditure plans by National Grid Gas Under RIIO-T1, by Category, 2014-
2021
Distribution Network
Figure 113: Controllable Cost Allowances for Gas Distribution Companies Under (RIIO-GD1), 2014-2021
Figure 114: Annual capex plans under RIIO-GD1, by GDN, 2014-2021
POWER & ENERGY SECTOR FORECAST
Key points
Market forecast
Figure 115: Forecast Market for UK Consulting Engineers in the Power and Energy Sector, 2015-19
Figure 116: Forecast Market for UK Consulting Engineers in the Power and Energy Sector, 2015-19
INDUSTRY STRUCTURE
Key points
Company profiles
ARUP GROUP
Company strategy and outlook
Figure 117: Financial Analysis of Arup Group, 2010-14
WS ATKINS
Company strategy and outlook
Figure 118: Financial analysis of WS Atkins, 2011-15
JACOBS UK
Company strategy and outlook
Figure 119: Financial Analysis of Jacobs U.K., 2010-14
AMEC FOSTER WHEELER ENVIRONMENT & INFRASTRUCTURE UK
Company outlook
Figure 120: Financial Analysis of AMEC Foster Wheeler Environment & Infrastructure UK, 2010-13
AMEY UK
Company strategy and outlook
Figure 121: Financial analysis of Amey UK, 2010-14
AECOM
Company outlook
Figure 122: Financial Analysis of AECOM, 2010-14
AECOM INFRASTRUCTURE & ENVIRONMENT (FORMERLY URS INFRASTRUCTURE & ENVIRONMENT)
Figure 123: Financial Analysis of AECOM Infrastructure & Environment UK, 2010-14
Figure 124: Turnover Analysis of AECOM Infrastructure & Environment UK, by Business Segment, 2013-
14
MACE
Company performance and outlook
Figure 125: Financial Analysis of Mace, 2010-14
Figure 126: Turnover Analysis of Mace, by Business Segment, 2013-14
MOTT MACDONALD GROUP
Company performance and outlook
Figure 127: Financial Analysis of Mott MacDonald Group, 2010-14
MOUCHEL
Figure 128: Financial Analysis of Mouchel, 2010-14
PELL FRISCHMANN GROUP
Company strategy
Figure 129: Financial Analysis of Pell Frischmann Group, 2009-13
PARSONS BRINCKERHOFF
Figure 130: Financial Analysis of Parsons Brinckerhoff, 2009-13
R P S GROUP
Company strategy
Figure 131: Financial Analysis of R P S Group, 2010-14
Figure 132: Turnover Analysis of R P S Group, by Business Segment, 2013-14
WSP GROUP
Figure 133: Financial Analysis of WSP UK, 2010-14
FURTHER SOURCES & CONTACTS
Trade magazines
Trade exhibitions
UK B2B
Trade research
Informal
Formal
Desk research
Consumer research
Sampling and weighting
Definitions
Qualitative Research
Further Analysis
Statistical forecasting

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