Hertz Global Holdings Inc., the Naples, Florida-based company specialized in auto rentals, has announced its 2014 results are expected to fall “well below” its initial assessment.
The company said the industrywide recalls – which have surpassed this year all previous records – as well as an accounting review were the main factors that made it reconsider its initial prediction. Data coming from the National Highway Traffic Safety Administration shows automakers in the US have so far recalled at least 44 million vehicles in just seven months.
“The company now expects to be well below the low end of its 2014 guidance,” Hertz said in a filing.
“People’s confidence is shaken,” said John Healy, an analyst with Northcoast Research. “The company has effectively guided down on the heels of weaker than expected 2013 results. Until they have true numbers, people are going to continue to have questions.”
Hertz said that its rental-car market was hit by higher-than-expected operating costs in US, while the equipment-rental business is battling softening demand. In addition, the company has failed to report earnings over the last two quarters after it discovered massive errors in the accounting department and reported it can no longer consider the past three years of financial statements as relevant.