Switzerland was neutral, but was still armed to the teeth. When Germany invaded neutral Belgium in World War II to attack France in a better position, the Swiss are very fear (rightly). They made a plan entitled “National Redoubt” basically designed so that any enemy would look into Switzerland on a map and decide it was not worth it to annex Switzerland. They began compulsory military draft for men and were able to mobilize an army of 400,000 men in two days that men were (and they still do) keep their guns at home.
It is noteworthy that these people were trained to fight in the mountainous Swiss terrain. antitank guns were disguised as barns. There’s stuff like that all over the country, especially in the South of France. For example, in the photo below, the building on the left is a machine gun nest and one on the right is an anti-tank gun. They are connected by an underground tunnel.
Each road track railway tunnel and emerging in the country can be blown from a remote location (there are over 3,000 of these points). This would have invaded a logistical nightmare for the Germans. The Swiss have so many bunkers that the Germans could not use their Blitzkrieg tactics in its full extent. In addition, Switzerland has held a lot of gold from Nazi Germany, valued at $ 400 million. If Germany invaded Switzerland, the Swiss have kept the gold for themselves.
Although the Germans annexed Switzerland, they would probably not get back all of their gold. Moreover, Germany already fighting on many fronts; it was illogical to open another difficult useless. Perhaps in Hitler’s mind when they had won the war, only then they might even try an invasion of Switzerland. The Swiss strategy has always been to give up the big population and retreat centers in the Southern Alps, where more than 26,000 bunkers were built and the enemies are not used to fighting in such terrain. In 1938, the League of Nations granted freedom Switzerland international sanctions because of its neutrality.
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Germany needed Switzerland to launder their money without penalties. Only Swiss banks do because they had to keep the name of the anonymous bank account owner in accordance with Swiss law. This is an invasion would be very costly and that Nazi Germany probably have been able to conquer Switzerland, they would have suffered heavy losses. Thus, while the cost-benefit analysis, Germany probably realized that it was a very stupid idea.