"Freight Train" by Donald Crews is a great, simple first book. Besides being about trains, which my 2 year old boy loves, it goes through primary colors also, using simple words and phrases he can understand. He likes to sit and "read" this one to himself. The English/Spanish version is actually enjoyable as well. The pictures are simple and bright. We love it! It's one of those Caldecott books that truly deserves the award.
Donald Crews also has several other books similar in style that are really enjoyable. They all have simple illustrations and language. We've enjoyed "Truck", "School Bus", "Harbor", "Parade", and "Bicycle Race" as well.