Cramer: Beginning of big dividend cycle?

GM: Mary Barra to succeed Dan Akerson as CEO

The loosening of government control over General Motors could position the company to offer shareholders big dividends as the storied U.S. car manufacturer transitions to new leadership, CNBC's Jim Cramer said on Tuesday.

"Remember GM used to have this huge dividend," Cramer said on "Squawk on the Street." "I remember my late grandfather had GM stock. Because that's what you owned. You owned utilities and you owned GM."

Cramer went a step further, saying GM was a better stock than Ford Motor.

(Read more: First female CEO shatters Detroit's glass ceiling)

A day after officially leaving government control, GM named 30-year veteran and product expert Mary Barra as its new chief executive. Barra will succeed current Chairman and CEO Dan Akerson on Jan. 15.

The news came a day after the Treasury Department announced it had sold back the last of its GM shares, left over from a $49.5 billion government takeover in the wake of the 2008 financial crisis. The exit from government control and emergence from bankruptcy frees up cash for stock buybacks and dividends for the first time since 2010.

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"This is the beginning of what could be a big dividend cycle," Cramer said. "GM has done so many right things. They have so much momentum around the globe and in the United States."

—By CNBC's Jeff Morganteen. Follow him on Twitter at @jmorganteen and get the latest stories from "Squawk on the Street." The Associated Press, Reuters and CNBC's Phil LaBeau contributed to this report.