Sirius XM   (SIRI - Get Report) is a solid bet, as long as car sales are robust, says TheStreet's Jim Cramer.

"People have to recognize this is a play on cars, both new and used," he says. "When you see a lot of cars being sold -- and we have a remarkable number of cars being sold -- you want to own Sirius."

Sirius relies heavily on contracts with car companies to install satellite radios in their cars. In Sirius' third-quarter earnings call on Oct. 22, the company said its penetration rate, the number of new cars sold with installed satellite radios, stood at 75%, suggesting Sirius may have to look for alternative sale channels.

In addition, Cramer cautioned that some bellwethers of auto sales are not promising. For example, shares of AutoNation, the largest car retailer in the United States, are down about 7% in the past month and nearly 30% year over year.

Nonetheless, he added, when auto sales are good, Sirius is good. 
The U.S. satellite radio provider has recently boosted its sports offerings, including expanded coverage of the NCAA Tournament and the Masters golf tournament. On Monday, Sirius announced it added 465,000 net new subscribers in the first quarter of 2016, yielding a record 30.1 million subscribers.  

Sirius has rebounded after narrowly avoiding Chapter 11 in 2008-2009. Still, its shares are about the same price as they were a year ago, and it is among the most highly shorted stocks on the Nasdaq.

Auto sales, meanwhile, dropped 2.1% in March, the largest increase in more than a year, after remaining unchanged in February, according to data from the Commerce Department released Wednesday. In contrast, Americans bought record numbers of cars in 2015. All told, retail sales declined 0.3% last month, despite the labor market continuing to grow stronger and wages finally starting to rise.

Excluding cars, gas, building materials and food services, retail sales edged up 0.1% in March following a 0.1% increase in February.