VW has to 'bloody well sort it out': Dijsselbloem

The President of the Eurogroup has urged Volkswagen to deal with the emissions scandal urgently, or risk damaging Germany's reputation for producing high-quality products.

"What VW has done has been very damaging to VW and they need to sort that out," Jeroen Dijsselbloem, the man who played a key role in pulling Greece back from the brink of economic collapse this summer, told CNBC at the International Monetary Fund annual meeting in Lima, Peru.

"German goods have a high-quality standard. That is such a valuable asset to have, so VW has to sort this out very quickly."

But despite the alleged wrongdoing, Dijsselbloem stressed that the automaker shouldn't be fined out of existence.

The U.S. Environmental Protection Agency accused VW in September of cheating on its emission tests for it diesel powered cars. The German auto giant has since acknowledged that it installed software known as "defeat devices" in diesel vehicles issued between 2009 and 2015.

VW could face U.S. fines of $37,500 per vehicle, the U.S. Environmental Protection Agency told reporters last week. With around 482,000 of its diesel vehicles sold in the U.S. since 2008, this could mean a penalty of up to $18 billion - significantly more than fines imposed on GM and Toyota in recent years.

"A fine needs to be effective against those who broke rules, but also needs to be effective... in correcting behavior (and) the worst way to do that is to kill the company," Dijsselbloem said.

"(I) think there is a case for greater co-operation between the EU and U.S. Let's not go over the top."

Dijsselbloem, who is also the Dutch Finance Minister, also insisted that deception over emissions was not Europe-wide.

"This it is not a European problem, it is a VW problem and if other companies have done the same they should bloody well sort it out also. Let's not make it a very broad issue," he said.

His comments came as the Volkswagen's U.S. CEO, Michael Horn, apologized at a hearing on Capitol Hill and said the automaker was "determined to make things right."

-- Reem Nasr contributed to this report.

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