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Cramer: Hertz has its ‘head in the sand’

Hertz shares fell more than 5 percent Monday after the company lowered its full-year revenue guidance, and CNBC's Jim Cramer said the news shows that rental car companies need to wake up.

"This is a challenged group not unlike the auto companies, which are all dealing with Uber. I think that their failure to acknowledge Uber shows me that their head is in the sand. There's obviously something wrong," Cramer said on "Squawk on the Street."

Hertz Global Holdings said it now expects car-rental revenues to range between flat and up 1.5 percent, down from a previous range of 1.5-to-2.5 percent growth.

"We are disappointed that the pricing pressure experienced late in 2015 further intensified in the first quarter of 2016," President and CEO John Tague said in a statement. "However, we believe that industry capacity will likely moderate as seasonal demand improves establishing the foundation for a relative improvement in pricing as we head into the peak summer season."

Hertz's stock has fallen over 55 percent in the last year.

"One of the reasons why it's this bad is because they talk about pricing pressure endlessly," Cramer said.

Hertz did not immediately respond to CNBC's request for comment.

Disclosure: Cramer's trust did not own Hertz stock when this article was published.