Elon Musk comes up with some great ideas. But as this forum has highlighted in the past, too many of them involve taxpayer subsidies. A Fortune magazine feature focuses on Musk’s latest successful effort to extract corporate welfare from gullible politicians.

Since the start of 2013, Tesla’s stock has soared 614%, producing a market cap of $30 billion—more than half the value of GM, which is expected to sell 10 million vehicles in 2014, compared with Tesla’s 33,000. The company has produced a stellar sedan—Consumer Reports scored it higher than any other car it has ever tested—and Musk’s achievements justify accolades: He co-founded PayPal and has made billions; SpaceX has made multiple missions to the International Space Station. (All of this was enough to make him Fortune’s Businessperson of the Year in 2013 and he’s on this year’s list, too.)

Yet Tesla offers only a single model, and it has yet to record an annual profit. The company’s future—and its giddy stock price—hinge on a seemingly paradoxical strategy: Tesla isn’t profitable selling cars for $70,000 and up, but it’s planning to sell a model for half that price starting in 2017. In theory, sales will jump more than 10-fold, to 500,000, by 2020.

That brings us to the key to the whole strategy, a decision that would raise the stakes for the company and ripple through multiple states: Tesla’s plans to build a gigantic factory to manufacture batteries. To make his new model affordable, Musk decided he needs a plant that can produce 500,000 lithium-ion battery packs per year—equal to the world’s current production. He expects the Pentagon-size facility to cost about $5 billion and begin turning them out by the end of 2016.

Some see this as a bet-the-company move, requiring near-perfect execution and a wholesale public embrace of electric cars, which today account for less than 1% of the auto market. To make the challenge even harder, every big carmaker is racing to develop its own electric models. The factory also means an outlay by Tesla of $2 billion or more—a hefty sum for a company with $3.7 billion in projected 2014 revenues.

The plan is “a tremendous risk,” says Cosmin Laslau, a technology analyst for Lux Research. He thinks Tesla will meet less than half of its 2020 sales target, which will saddle it with cash-draining overcapacity. “Tesla’s grand designs,” Laslau concludes, “are dangerously ambitious.”

But “Do the impossible” is one of Tesla’s slogans, and Musk set out to make it happen. He looked to spread the costs, seeking a mammoth package of incentives from states for the right to be the factory’s home. He succeeded—and then some. Musk landed a stunning $1.4 billion in tax breaks, free land, and other beneficence from Nevada to build the factory outside Reno. It’s one of the biggest gift baskets in history.