GE transport unit to cut or furlough 1,550 workers

The cutbacks affect about 14 percent of the 11,400 workers at GE Transportation, spokesman Stephan Koller said.

About 150 salaried and 200 hourly workers will lose their jobs. The layoffs may last from May to November, Koller said.

GE Transportation, which is based in Erie, Pennsylvania, said it expects locomotive production volume to decline more than 40 percent this year from 2008. It also said more than 50 percent of its backlog is slated for 2010 and 2011.

"The overall economic downturn is substantial and we at GE Transportation are not immune," Simonelli said in a statement.

GE is trying to reduce expenses and preserve its "triple-A" credit ratings after profit fell 44 percent in the fourth quarter, with particular weakness at its GE Capital finance unit.

Chief Executive Jeff Immelt has also said he plans to "evaluate" GE's dividend for the second half of 2009. The quarterly dividend is now 31 cents per share.

Shares of GE closed Tuesday down $1.02, or 8.1 percent, at $11.62 on the New York Stock Exchange. The company is based in Fairfield, Connecticut.

(Reporting by Jonathan Stempel; Editing by Christian Wiessner)