South Korea's Krafton, Hanwha announce defense-tech JV on physical AI, modeled after Anduril
Krafton, the South Korean game developer behind PUBG, and Hanwha Aerospace announced a plan to form a joint venture focused on physical artificial intelligence, or AI. The companies said they would advance practical, real-world applications of physical AI and aim to grow the venture into a defense-tech firm modeled on the U.S. company Anduril Industries. The announcement was made on the 13th.
Under the collaboration, the partners will pursue joint research and development of core physical AI technologies, evaluate demonstration and deployment scenarios, and establish the technical and operational frameworks needed to bring solutions to market. The effort centers on turning AI systems that operate in physical environments into reliable, deployable tools.
Krafton stressed that its experience in data management and virtual-environment simulation will be a key asset in training, validating, and accelerating the learning cycles of physical AI. The companies plan to stage pilot tests in real-world settings to verify performance and readiness before broader deployment.
In addition to the JV, Krafton will participate as an investor in a fund launched by Hanwha Asset Management. The fund targets up to 1 billion dollars and concentrates on high-potential ventures in AI, robotics, and the defense sector. The two firms said the fund will help identify partner companies and connect development with commercialization through the joint venture.
Krafton chief executive Kim Chang-han said the collaboration would fuse Krafton’s AI and software-operating capabilities with Hanwha’s on-site, manufacturing-oriented strengths to speed up the deployment of technology in real-world environments. He added that establishing the JV and turning its results into commercial products would help grow the venture into a global defense-tech company akin to Anduril.
Hanwha Aerospace chief executive Seong Jae-il underscored that AI technologies are expanding from industry into defense through physical AI, and that the Krafton partnership could set a new standard for the future of defense technology.
Why this matters beyond Korea for U.S. readers: - The plan signals deeper cross-border collaboration in advanced AI, robotics, and defense tech, with a South Korean game developer contributing data, simulation, and software-operating know-how to a defense-focused business model. This could affect tech supply chains, hardware-software integration, and international partnerships tied to U.S. defense priorities. - Anduril, cited as the archetype for the envisioned company, is a prominent U.S. defense tech firm. A joint venture of this scale could create new pathways for U.S.-Korea collaboration on autonomous systems, surveillance, and sensor networks, potentially influencing future procurement and partnerships with U.S. defense agencies and allied customers. - The involvement of Hanwha Asset Management highlights how large Korean conglomerates are financing and structuring AI and defense ventures, which has implications for global investment trends, risk sharing, and export-control considerations in high-technology sectors. - For U.S. readers, the development could shape competitive dynamics in AI-enabled defense tools, affect related markets (robotics, simulation software, data analytics), and influence policymakers’ considerations on international cooperation, technology transfer, and governance of emerging military AI.