South Korea's leading defense systems company Hanwha Aerospace and game publishing giant Krafton have agreed to jointly develop physical artificial intelligence (AI) technologies and establish a joint venture for commercialization. The partnership combines Hanwha's defense and manufacturing infrastructure with Krafton's AI research and software expertise to build a mid- to long-term cooperation framework. The collaboration is expected to expand into space and aviation sectors over time.
On March 13, 2026, Hanwha Aerospace and Krafton signed a memorandum of understanding (MOU) to jointly develop physical artificial intelligence (AI) technologies and establish a joint venture for their commercialization. Under the MOU, the companies will conduct joint research and development (R&D) of core physical AI technologies, review verification and application scenarios, and establish technical and operational systems.
The collaboration merges Hanwha Aerospace's defense and manufacturing infrastructure along with unmanned system technologies with Krafton's AI research capabilities and software development expertise. The firms plan to commercialize the joint development outcomes through the venture and create a mid- to long-term cooperation framework. In the long term, they aim to extend their partnership into space and aviation sectors.
Additionally, the companies will invest in a $1 billion fund set up by Hanwha Asset Management, focused on AI, robotics, and defense.
"AI technology is rapidly expanding beyond industries, with new physical AI applications emerging in the defense sector," said Son Jae-il, chief executive officer of Hanwha Aerospace. "Our partnership with Krafton will offer a new paradigm standard for physical AI and future defense."
Krafton CEO Kim Chang-han stated that the joint venture could evolve into a global defense technology firm like Anduril Industries Inc., based on "physical innovation by combining the company's AI technology and software expertise with Hanwha's industrial strengths."
This partnership highlights the growing integration of AI in the defense industry.
