M&A Trends in the Engineering & New Technologies Sector : 2024 Market Overview

A Year of Contrasts for the Engineering Sector

The year 2024 extended several trends observed in recent years, while also marking key inflections across engineering sub-sectors. While technology consulting and industrial process engineering benefited from favorable dynamics—driven by digital transformation and energy transition—construction engineering experienced a marked slowdown amid challenging market conditions.

At the same time, 2024 confirmed the strong momentum of environmental engineering, with rising demand for expertise in areas such as soil, water, and air pollution, biodiversity, and environmental remediation.

Construction Engineering Confronts a Difficult Environment

In 2024, the construction market stagnated, particularly impacting new residential and commercial building projects. Rising interest rates and ongoing economic pressures continued to weigh heavily on both residential and non-residential real estate. New housing starts dropped by 14.2%, directly affecting the activity levels of engineering firms and design consultancies specializing in construction.

Nonetheless, several factors helped offset this decline:

• The energy renovation market remained dynamic, fueled by stricter environmental regulations and government incentive programs.
• Public infrastructure rehabilitation projects gained momentum, particularly under the Ecological Transition Plan and requirements linked to the Tertiary Sector Decree.
• Growing demand for high-performance, low-carbon buildings pushed engineering firms to develop specialized expertise in sustainable design.

Despite a significant contraction in new construction, the building and infrastructure engineering segment found growth levers in renovation and retrofitting, aligned with tightening environmental standards.

Industrial Process Engineering: A Core Growth Driver

In contrast, industrial process engineering continued its strong growth in 2024, supported by several strategic trends:

• Acceleration of industrial decarbonization, with investments in energy efficiency, green hydrogen, carbon capture and storage, electrification, and automation of processes.
• Industrial sovereignty and reshoring strategies, as geopolitical tensions and reindustrialization policies drove efforts to secure supply chains and reinforce strategic autonomy.
• Growth in the pharmaceutical and agri-food sectors, where technological innovation is essential to meet increasing demands for quality, traceability, and sustainability.
• Process automation and optimization, with emerging technologies boosting productivity and enhancing competitiveness.

Artificial intelligence and digital simulation played an increasingly central role, boosting demand for specialized skills and advanced optimization solutions across industrial operations.

The Energy Transition as a Sector Catalyst

The energy transition remained a major catalyst shaping the priorities of engineering firms in 2024. Companies launched numerous projects to comply with evolving regulations and ambitious carbon reduction targets. Three key trends stood out:

• Renewable energy infrastructure development (solar, wind, green hydrogen), requiring strong capabilities in grid engineering and energy storage.
• Positive-energy buildings and smart infrastructure, incorporating advanced energy management systems (GTB/GTC, IoT, BIM).
• Low-carbon mobility, with large-scale investment in EV charging infrastructure and electrified transportation networks.

These shifts prompted engineering firms to broaden their skill sets and diversify service offerings to better align with evolving client and regulatory expectations.

M&A as a Strategic Lever in Engineering Transformation

In this rapidly evolving environment, 2024 saw a high number of M&A transactions across the engineering value chain. These deals were motivated by several key objectives: overcoming recruitment challenges, accelerating entry into high-growth markets, and deepening technical capabilities.

Emerging M&A trends included:

• Strengthening electrical, thermal, and energy engineering expertise, with strategic acquisitions in electrical systems, HVAC, and energy optimization. In December 2024, Groupe Ortec acquired Groupe Weetec, a regional leader in electrical and HVAC engineering in Île-de-France, to support its environmental and energy transition services, particularly in building retrofits. At year-end, Groupe Fauché announced the acquisition of Groupe Sylpa, expanding its expertise in innovative energy solutions.
• Integration of digital and automation capabilities, in response to growing demand for AI and simulation tools in industrial process engineering. The acquisition of IESA by GCC’s Energy division exemplifies this trend, enabling the group to expand its industrial IT and automation portfolio.
• Consolidation of specialized engineering firms, as major players pursued external growth to secure their market positions amid ecological and digital transitions. Groupe ALTYN made three acquisitions in 2024 to strengthen its positioning in energy, environmental, and digital transformation of buildings and urban territories.
• Diversification into renewable energy and low-carbon engineering, with accelerated investment in sustainable infrastructure markets. For example, SPIE Group acquired 85% of Correll Group, a major provider of engineering, installation, and maintenance services in offshore wind. This strategic move supports SPIE’s ambitions in the renewable energy space.

These strategic acquisitions allowed firms to enhance their expertise and position themselves competitively in fast-growing market segments.

Outlook for 2025

2025 is expected to present a mixed outlook across engineering sub-sectors. While the construction market remains under pressure, building renovation, energy transition, and sustainable infrastructure are likely to sustain sector activity. In industry, projects related to decarbonization and automation should continue driving growth.

However, engineering firms will face key challenges in recruiting and developing talent to support these major transformations and meet rising demand from both corporate and public sector clients. Access to technical expertise and innovation capacity will be critical success factors in navigating the road ahead.