Says the country that wants to build a wall to Mexico.
Not straying into politics though, how else would you make sure that the cars entering a country are road legal, apart from checking them at customs? And not everybody is stopped there for an inspection. Actually hardly anybody gets stopped when entering Germany (or Switzerland). As long as your car looks half decent and doesn't have any parts falling off (or the wheels catching on the body work, or no number plate!), you can pass freely from one country into the other. (ok you might get stopped for looking suspicious or belonging to a certain ethnicity, or crossing the border at a suspicious time, for instance when everybody from Switzerland goes shopping in Germany and doesn't feel like paying import tax on their way back. This usually happens every Saturday, very bad time to cross the border.)
The kind of cars that get stopped at customs regularly are mostly either very very old and in bad condition, or heavily (and visibly) modified. And since a badly maintained or shodily modified car can be a danger to other people on the road, I think it's reasonable to stop and turn them around.
Btw: that particular was also not road legal in Switzerland, and the driver got a fine for it (in Switzerland). I guess he never thought it necessary to register the modifications and have them checked. While the TUV-equivalent in Switzerland is a bit more relaxed, it still exists and people have to bring their cars in for mandatory inspections, although not quite as regularly as in Germany. You can't just lower your car to the ground clearance of an F1 car, put bigger tires on it (with the assistance of some washers) and call it a day. That shit needs to be inspected by a government official afterwards, and only if they deem the car still roadworthy, then you can drive around in it. At least that's the idea.