Why do major international universities still have courses in languages other than English?
ETH and all other universities in Switzerland are funded by the government and offer college education for minimal tuition. While foreign students are welcome to attend, the primary purpose (at least at the undergraduate level) is to provide education to the locals. Nonetheless, that doesn't seem to be a limiting factor, especially at the graduate/research level since ETH has been recently ranked one of the most international institutions by Times Higher Education.
There is a wealth of excellent textbooks in German, and many fields still have original research published in German. Also, the majority of students don't pursue academic or research careers and thus might very well spend their entire career speaking almost only German.
Plus there are practical considerations too: asking non-natively English speakers to teach in English is most certainly going to decrease the average teaching quality. Now if it's to give lectures to a class that is almost entirely German speaking, it borderlines the absurd.
The question seems to be more: why would some universities switch their teaching language to English?
While original research is dominated by English, good textbooks are available in most languages. Needless to say, having learning material in your native language helps a lot, even if you master English.
The level of English required to read technical literature is much lower than the level required to express yourself freely and understand fast-paced speech. Having all courses in English would eliminate students which are good at their discipline but mediocre in foreign languages.
There are some excellent answers out there, but let's add this:
Not all undergraduate programs lead to graduate studies. In fact, most undergraduates go on to work. We can speculate that the work environment will be in the language of the country. Actually, there's even a place where this is the law. In Québec (Canada), most companies are required to have French as the working language.
Also, how are we to keep the connection between public and science if scientists cannot explain their work in the language of the public?