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ACCIONA Engineering reinvents itself for growth

07/01/2016

Over the past five years, ACCIONA Engineering has undertaken projects in 60 countries and become one of the most prestigious companies in its sector. Now it plans to develop new activities — beyond the definition of classical engineering — and enter other markets to continue growing in future.

Luis Baz, , Director of ACCIONA Engineering, is especially proud of the commitment of his team to their company when it needs them to go to some of the remotest and most inaccessible places on the planet. He remarks upon the great effort they make to be where the contract is. “Our people have an outstanding capacity to travel and move around to develop projects wherever they arise.” And the sacrifice is worth it, too. ACCIONA Engineering has undertaken projects in 60 countries in the past five years alone.

ACCIONA Engineering invoiced 35 million euros in 2015, which it says will rise to 38 million in 2016, and expects sustained growth for several further years

The company’s domestic and international experience has made it one of the sector leaders thanks to its presence in every region and specialization in certain areas — mainly transport infrastructure, maritime works and land engineering, among others — and expertise with multilateral credit organizations, indispensable for financing many projects. It has also garnered prestige as an excellent travel companion! The company is the ideal partner for taking on any engineering contract in the world. “These two elements — local presence and our expertise in several areas — allows us to work on a level with companies much bigger than ourselves and we have fostered the culture of working in consortia abroad and with international companies,” Mr Baz explained. He also highlights the excellent relations the company has developed with high-level French, British and Italian companies it works with regularly abroad.

 

NORWAY MILESTONE

One of the company’s biggest achievements in recent months was to win a contract with the Follo Line engineering project in Norway, most of which it has been awarded alone. “We have the sub-contract from a big Danish company, Cowi, but 95% of the contract exclusively concerns ACCIONA Engineering, working for a construction consortium of which the Group’s construction arm is part,” Mr Baz pointed out. ACCIONA Engineering has also developed a strategy here he believes should be reproduced in future. “It is a good template for the participation of ACCIONA Engineering in Group projects: present in the early stages, including business development and detecting opportunities, and from thereon in the preparation of the offer, resulting in the award of important projects,” he added.

This has to be done “without losing sight of two concepts that are our essence in offering our services to third parties or the Group: quality and always being price competitive, and flexibility in providing the service…”The Norwegian project has had a big impact over the past year; on the one hand, because it has increased the amount of business provided to the rest of the Group, and, on the other, for increasing volume in Europe. ”Traditionally, between 15 and 20% of ACCIONA Engineering sales are services provided to the rest of the Group and around 80 to 85% for third parties. We want to maintain that,” stated Mr Baz. The moment has also arrived for the company to reinvent itself. ACCIONA Engineering invoiced 35 million euros in 2015, which it says will rise to 38 million in 2016, and expects sustained growth for several further years. How? By exploiting new business lines and markets.

“We need to find and develop new activities, new business lines, with the aim of growing,” said the ACCIONA Engineering Director. Consulting, project management, railway installation specialization, hydroelectric projects, social and environmental impact studies and the introduction of Building Information Modeling (BIM), will all be important new activities, among others. “Classical engineering or, as I would call it, ‘from the catalogue’, is increasingly price-driven, so we have to develop new activities that aggregate value. As such, we are reinventing ourselves every day,” he concludes.

 

EXPLORING NEW MARKETS

As well as developing new businesses, ACCIONA Engineering wants to explore markets for development. Forty percent of sales currently come from Latin America and 10-12% from Spain. “The aim this year is to reverse the trend and reduce our dependence on Latin America, increasing our percentage of business in Africa and Europe,” Mr Baz explained. The company now has an important presence in its regional centers in the world — Gabon, Romania and Qatar — and in specific countries such as Bolivia. In Costa Rica, inconsortium with Ineco, it has just signed one of its most important recent contracts: the management of the Infrastructure Plan for the country, which will see it providing consulting services for the administrative, technical, legal and environmental management of the Transport Infrastructure Program (PIT) commissioned by the Costa Rican Government.

As well as developing new businesses, ACCIONA Engineering wants to explore markets for development

The objective is to modernize the road and port infrastructure of the country, as well as improving the project administration, auditing and assessment processes. Several years ago, ACCIONA’s engineering area won El Salvador’s Territorial Development and Management Plan. “It was basically developing a national plan, not only for infrastructure, but on the legal level and for local and regional administration… and this had a 20-year horizon, which signified an very important level of planning for the country,” Mr Baz recalled.

 

THE ROADS AREA

This positive experience helped ACCIONA Engineering win another important contract in El Salvador recently, for its special characteristics if not the value. It consists of a road for the Public Works Ministry, financed by the Millennium Challenge Corporation (MCC), the US cooperation and development agency. The project will “incorporate a focus on road design”, said Mr Baz, “not an easy thing to establish”.

Clients increasingly ask us for things that are not strictly linked to engineering and ‘the calculation of a beam’… We need the capacity to adapt to these requirements. We have been able to adapt to this necessity and have responded brilliantly. One challenge was to determine whether the needs of a road, in a country like El Salvador, are any different for men than they are for women!” Another important recent contract concerns the social and environmental impact study for a new desalination plant in Gaza (Palestine), with financing from the European Union. The company will also soon be bidding for several hydroelectric projects — either from

the viewpoint of classical engineering or the performance of social and environmental impact studies — in countries as diverse as Tanzania and Nepal. “Being in many countries can be seen in two ways: we are widely dispersed, or we have a great capacity for travel. I prefer to think in terms of the latter,” enthused Mr Baz, a vocational traveler who wants to take ACCIONA Engineering to where the business is — without worrying about the miles it has to cover.

 

TACKLING CLIMATE CHANGE IN THE HORN OF AFRICA

ACCIONA Engineering recently led an international team of experts in preparing a Regional Climate Change Strategy for the IGAD (InterGovernmental Authority on Development) region — formed by several African countries including Djibouti, Eritrea, Ethiopia, Kenya, Somalia, South Sudan and Uganda — which is being financed by the European Union for the 2016-2030 period. The initiative to develop a regional strategy in the Horn of Africa is framed in the context of global concern over climate change, with the aim of uniting efforts to promote low carbon emissions and lasting development despite global warming in the region.

With this contract, ACCIONA Engineering has strengthened its international activity as a company that develops initiatives against climate change. The contract was performed by experts from the company and Prospect C&S, part of the Suez Lot6 Consortium working under the European Union Framework Agreement.

 

Luis Baz, Director, ACCIONA Engineering 

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