Korea's Hanwha Aerospace and Krafton develop AI-driven unmanned systems for space and aviation.
South Korea’s Hanwha Aerospace and game developer Krafton have signed a memorandum of understanding to jointly develop AI-based “physical AI” technology for unmanned systems, with plans to establish a joint venture to commercialize the research and to widen the collaboration into space and aviation sectors.
Physical AI refers to AI that directly controls robots, drones, and other unmanned equipment. In defense circles, its potential applications include unmanned combat systems, autonomous drones, and intelligent surveillance, among other uses.
Under the agreement, the two companies will pursue core research on physical AI, evaluate proof-of-concept scenarios, and build technology and operations frameworks in stages. In the long run, they aim to commercialize research成果 through a joint venture and expand the scope of their collaboration.
Hanwha Aerospace will bring defense and manufacturing infrastructure and unmanned-system know-how, while Krafton will contribute AI research capabilities, data management experience, and software development expertise, including virtual-environment simulation. The collaboration will emphasize testing in realistic environments to validate practicality and readiness for field deployment before expanding to space and aviation applications.
The two firms also plan to pursue investment cooperation. They will participate in a fund established by Hanwha Asset Management, targeting about $1 billion, focused on AI, robotics, and defense-sector companies to expand the physical AI ecosystem and strengthen the tech pipeline for future commercialization.
Krafton CEO Kim Chang-han said the partnership would fuse Krafton’s AI and software-operating capabilities with Hanwha’s field expertise to accelerate real-world technology development, with the goal of forming a joint venture that can scale up as a global defense-technology company. Hanwha Aerospace CEO Son Jae-il stressed that AI-driven physical AI is rapidly expanding beyond civilian industries into defense, and that the collaboration will “shape a new paradigm” in the field.
The move fits a broader, global push around autonomous, unmanned defense systems. As firms seek to sharpen competition in physical AI, other players such as Anduril and Shield AI are pursuing autonomous mission software and flight capabilities, while Lockheed Martin and Collins Aerospace are accelerating human-autonomy collaboration and related technologies. The trend is also mirrored by industry efforts to validate AI systems in digital environments before real-world deployment.
Industry observers note that broader adoption of physical AI could affect U.S. defense supply chains and information-technology collaboration, given the close ties between American defense contractors and international partners in AI, robotics, and secure communications, as nations seek to maintain advanced capabilities in a shifting geopolitical landscape. In parallel, comparative advancements in Korea’s defense-tech ecosystem could influence regional balance and international partnerships in emerging technologies.