Making Interior Components for Trains: Testori Interiors

When Marco Lapegna and his father, Lindo, were given a tour last year of a then-vacant 100,000-square-foot facility on West Service Road in Champlain, they immediately knew it would be the newest location for their family-run business, Testori Interiors―a manufacturer of interior components for trains, including panels, flooring, and laminates.

“We saw the very attractive piece of real estate, and we were encouraged to be near Bombardier to better enhance our relationship with them and become a better supplier,” said Lapegna, the 24-year-old chief financial officer. “It was a one-of-kind building and the price was right.” The company will be able to focus on nurturing that relationship for years to come, as Testori decided to outright purchase the building and has no intentions of going anywhere.

Lapegna was born in Taranto, a coastal city in Italy’s Apulia region. After serving in the Italian navy, his father was hired by the original Testori company, which had been launched more than 100 years earlier as a textile business. Highly-respected after only three years with the company, he was selected to run the expansion into the Western Hemisphere and Testori Americas was established in 1993 in Canada.

“There was an opportunity to expand in Prince Edward Island and they asked him to run that company,” the younger Lapegna explained. The family moved to Prince Edward Island, where Lapegna spent his teenage years and his father helped to grow the company, eventually helping it win the prestigious Exporter of the Year Award for Prince Edward Island in 2002. “As he became more and more successful, he bought majority ownership.”

In 1998, the original Testori in Italy closed, leaving only the Testori Americas operation. “All that was left was Prince Edward Island, and then in 2001 we opened a facility in Hornell, New York,” Lapegna said. Testori Interiors, while launched as a subsidiary of Testori Americas, is now privately held. “Theoretically, it is its own company. My father owns 50 percent and the other 50 percent is owned by another group.”

The idea for Testori Interiors came when Lapegna’s father saw an opportunity. Interior parts suppliers for train, plane and bus manufacturers had become very specialized over the years, with one company emerging as the leading provider of aluminum and another focusing on lamination. This placed a great deal of cost on the customer, who was faced with combining many different components into a design that both fits the product and is aesthetically pleasing.

“Our main objective was to become a one-stop-shop for our customers,” Lapegna explained. “Our goal is to make it easy to just pick our part and put it on their train without having to do much assembly work. We want customers to come to us and let us handle the drawing and engineering phases, find the best price, and make the whole process as easy as possible for them.”

In addition to Bombardier, Testori does business with other well-known manufacturers. “We also do work for Kawasaki, Hyundai-Rotem, and AnsaldoBreda. In fact, those are our biggest customers,” Lapegna said. “They represent 90 to 95 percent of our business.”

Certainly there are inherent risks in having only a few customers. “You run the risk that your sales are not necessarily dependent on your own work, but on your customers,” Lapegna said. “If they are not doing great, it tends to come down the line and suppliers will start to get squeezed.”

However, there are some subtle, yet powerful, advantages to being the primary supplier to one or only a few manufacturers. “Rather than trying to appease many different customers, you can focus on being attentive to the ones you have. That is a plus and it makes it easier. Also, it is hard for a competitor to come in and establish a relationship like the one you already have with a customer.”

Testori also offers a diverse range of products, making it more difficult for competitors to attract customers. “We do have competitors but on a small scale,” he said. “They do much smaller components, so they are not as broad-based as we are.”

To make its products, Testori uses metal components, aluminum, extrusions, plywood, melamine skins for the panel faces, as well as a large amount of screws, nuts, bolts, rivets and other fastening hardware. The business employs state-of-the-art craftsmen and produces cost-effective parts for its customers.

More importantly, Testori must ensure that all of its interior panels are made to the exact quality specifications requested by the customer. Lapegna said, “Obviously these interiors have to be constructed precisely, and we have methods for achieving that.”

While the Champlain business is set up to cater to Bombardier, it is also paving the way for future growth opportunities and cost savings. The operation currently has room for nearly 50,000 feet of expansion, another reason to favor the location.

And there are advantages for Testori to be located so close to Canada. “We are close to Quebec, which has a lot of hardware manufacturers,” Lapegna said. “So that helps keep our transportation costs low. It’s also easier to work with brokers to negotiate better deals.”

Lepegna said the local employee pool was another important factor in its decision. “There are lots of people looking for work who are very talented.”

The company’s move from Hornell brought about a dozen employees from its Western New York location. The rest were hired locally. “There are some very good floor positions for machine operators and line leaders.”

Currently, Taranto employs more than 20 people on a full-time basis and Lapegna hopes to keep adding to the workforce. “We look for people who are good at reading blueprints,” Lapegna said. “We also look for people who can use quality control tools. We have a need for some very specialized people. Going into the future, we are in talks to secure more contracts, so we definitely expect to increase our staff before the year is over. We could be over 50 employees.”

While Lapegna is optimistic about the local talent, he is also moved by the outpouring of support from members of the community. “Everybody was very friendly and very eager for us to come over. Everyone I talked to has helped to make our move as easy as possible for us to be here and get set up.”

Lapegna, who has worked at the Champlain location since April 2008, admits that relocating a business and commencing operations in a short period of time was a daunting task. “The biggest challenge has been setting everything up and getting up and running,” he said. “We have a lot of contracts and we are looking to grow relatively quickly. The turnaround time was very short. Coordinating all of that was definitely the biggest challenge.”

Lepegna’s father continues to serve as the company’s president. “He works in Prince Edward Island, but he runs the overall strategy of the company.” Lapegna pointed out the positive and negative aspects of family business. “It is hard to distinguish between home and work. There are definitely times we don’t agree, and you might take that personally and bring it home.”

On the other hand, Lapegna said, it’s a pleasure to see his father frequently, sometimes on a daily basis, occasionally seeking his advice regarding work-related matters. “Most people have to get a job and move across the country and away from their families and see them only a couple times each year.”

It is the hard work of the father and son team that has helped guide Testori through the early make-or-break months of the business, and they are able to find pride every day in their accomplishments.

Lapegna also wanted to give credit to Greg Fox, sales manager, and Ottavio Angelico, production manager, for helping to bring the business to fruition so quickly. “We have a lot of good people here,” Lapegna said. “Greg and Ottavio are two of them. They make my job easy and they’ve really done most of the work. Between the two of them, they know the business.”

He concluded his comments, saying, “The business is coming together; it is nice when you see your hard work repaid.” But his experience in the community has been just as memorable as the early success of the company. “The most rewarding part,” he said, “has been just meeting the different people here in the area.”