Rudiger is in the final year of his contract at Chelsea and the club are keen to offer him a new deal to stay at Stamford Bridge.
But there is no agreement in place and there are suggestions that the centre-back’s wage demands have spooked the European champions.
McCoist conceded that Rudiger has been brilliant since he returned to the line-up under Thomas Tuchel last season and played a key role in Chelsea winning the Champions League.
But he believes Chelsea should walk away from the negotiations if they deem his demands to be excessive and stressed that they would not find it hard to replace him with another top-class centre-back given their appeal in Europe.
McCoist said on talkSPORT: “I think he has been absolutely tremendous since he got back into the side and I don’t think there is any doubt about that.
“But the club and Thomas Tuchel can’t be held to ransom.
“I am saying that not knowing the ins and outs of the potential deal that has been offered, but they will obviously have a budget and if he is not happy then sometimes you have got to say, ‘OK and good luck and will take what we can for you’.
“But that said, he will be a loss at this moment in time.
“There will be a queue, the length of the King’s Road of top-class defenders who want to go to Chelsea.”
Chelsea are claimed to have offered him a contract worth £140,000-a-week, which fell short of the defender’s expectations.
