{"id":81123,"date":"2026-07-10T04:20:11","date_gmt":"2026-07-10T04:20:11","guid":{"rendered":"https:\/\/www.europesays.com\/korea\/81123\/"},"modified":"2026-07-10T04:20:11","modified_gmt":"2026-07-10T04:20:11","slug":"lg-bets-big-on-physical-ai-squares-off-with-nvidia-in-world-models-2","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/korea\/81123\/","title":{"rendered":"LG Bets Big on Physical AI, Squares Off With Nvidia in ‘World Models’"},"content":{"rendered":"

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\u25b2AI PRISM* Customized Economic Briefing<\/p>\n

*Editor’s Note: ‘AI PRISM’ (Personalized Report & Insight Summarizing Media) is an “AI-based customized news recommendation and summary service” developed with support from the Korea Press Foundation. It selects and provides six customized news items by reader type.<\/p>\n

\u25a0 Physical AI Brain Competition: The LG (003550) Group has fully entered the competition over core physical AI technologies\u2014artificial intelligence applied to the physical world\u2014that serve as the brains of robots and machines. Major affiliates including LG Electronics (066570), LG AI Research, and LG CNS have joined forces under a “One LG” cooperation framework, adopting a two-track strategy to simultaneously develop action models (technology controlling robot movements) and world models (technology that learns physical laws to simulate virtual worlds).<\/p>\n

\u25a0 AI Cost Optimization Accelerates: The global AI token (a unit of measurement for AI services) spending index plunged 22% in just over a month, as cost-efficiency trends spread rapidly among companies. On OpenRouter, the world’s largest AI model brokerage platform, the token share of Chinese AI models such as DeepSeek and Zhipu AI soared to 48% as of the last week of June, far surpassing U.S. models (20%).<\/p>\n

\u25a0 Global T+1 Transition: The United Kingdom, the European Union (EU), and Hong Kong are set to shorten their stock settlement cycles from the current T+2 to T+1 (settlement within one business day of purchase) in the second half of next year, and 90% of the world’s stock market capitalization is expected to be incorporated into the T+1 system. In contrast, Korea has yet to establish a concrete transition roadmap, raising growing concerns that it could miss out on opportunities for global fund inflows.<\/p>\n

[News of Interest to Corporate CEOs]<\/p>\n

1. Physical AI Brain Competition With Nvidia and Google\u2026 Autonomous Manufacturing Capabilities Make ‘Quantum Jump’<\/a><\/p>\n

– Key Summary: The LG Group has fully embarked on developing world models (technology that learns physical laws to simulate virtual worlds), the brain technology of physical AI (artificial intelligence applied to the physical world), forming a competitive structure with global big tech firms such as Nvidia and Google. LG Electronics’ Production Engineering Research Institute and LG AI Research are conducting a joint project to develop an industrial Robot Foundation Model (RFM, an action model that controls robot movements), while LG CNS has partnered with PhysicsX to begin developing an industry-specific world model. Meanwhile, LG Electronics is carrying out a Ministry of Science and ICT project to develop a domestic world model while also pursuing cooperation on using Nvidia’s Cosmos (Nvidia’s world model). Through participation in a mega project, the LG Group has decided to invest 9.4 trillion won in the robotics and physical AI sector in the Yeongnam region by 2030.<\/p>\n

2. Conserve Fable5, Use Chinese AI for Easy Tasks<\/a><\/p>\n

– Key Summary: According to overseas market research firm Silicon Data, the global AI token (a unit of AI measurement) spending index plunged 22% from a peak of $2.1 per million tokens on May 26 to $1.64 on the 7th of this month. This resulted from companies reducing their use of frontier (top-tier) AI models such as Anthropic and OpenAI, and increasing the share of simple tasks handled by Chinese lightweight AI models such as DeepSeek, Zhipu AI, and MiniMax, which are about 10 times cheaper. Alongside this, Nexon temporarily suspended internal use of Anthropic’s latest AI model, Claude Fable5, after its billing method switched from subscription to usage-based pricing, and is establishing a cost-optimization policy. In addition, KT has put forward a “Token Factory” that supports AI model selection and billing optimization as a new business, targeting corporate demand for cost efficiency in AI transformation (AX).<\/p>\n

3. 90% of Global Market Cap on T+1 Next Year\u2026 “Korea Must Keep Pace With the ‘New Normal’ to Be More Attractive”<\/a><\/p>\n

– Key Summary: The United Kingdom, the European Union (EU), and Switzerland plan to shorten their stock settlement cycles from T+2 to T+1 (settlement within one business day of purchase) on October 11 next year, and Hong Kong in the fourth quarter of next year, so 90% of the world’s stock market capitalization is expected to transition to the T+1 system. A London Stock Exchange Group (LSEG) official said the introduction of T+1 in October next year is proceeding without setbacks, and Andrew Douglas, chair of the U.K. settlement cycle reduction task force (TF), stressed that 90% of the companies involved will finalize their scope of work and budgets by the end of this year. Chris Elms, CEO of Euroclear UK & International (EUI), explained, “Companies that automated their post-trade operations reaped the benefits of the transition faster,” adding that they would focus on automation and operational readiness before implementation in October next year. In contrast, Korea has no roadmap for introducing T+1, and the Korea Exchange’s launch of a 7 a.m. pre-market has been postponed from September this year to the end of next year, prompting criticism that Korea could miss opportunities for global fund inflows.<\/p>\n

[Reference News for Corporate CEOs]<\/p>\n

4. China Says “Delete Claude Code” as U.S.-China ‘AI Standoff’ Spreads<\/a><\/p>\n

– Key Summary: The China National Vulnerability Database (CNVDB), under the Chinese government, recommended deleting or updating to the latest version of some versions of U.S. AI firm Anthropic’s coding tool “Claude Code,” saying it contained a monitoring mechanism that transmits location and identity information to remote servers without user consent. Accordingly, Chinese big tech firm Alibaba also instructed its employees to stop using Claude Code for work starting on the 10th, and an Anthropic employee explained via social media X (formerly Twitter) that “the code was an experiment to prevent unauthorized access from China and AI model distillation.” Experts interpret this issue not as a simple cybersecurity matter but as an extension of the U.S.-China technology competition. Ben Hu, a member of the Hong Kong and China Cyber Security Association, said, “Chinese companies will need to evaluate AI firms as part of a strategic supply chain affected by geopolitical variables and national security.”<\/p>\n

5. Hyundai Motor (005380) U.S. Unit Tests Payments With Tether\u2026 Transfer Done in Just 7 Minutes<\/a><\/p>\n

– Key Summary: Hyundai Card and Hyundai Motor completed a proof-of-concept for international transfers between Hyundai Motor’s U.S. unit (HMA) and its Mexico unit (HMM) using the dollar stablecoin Tether (USDT, a digital asset pegged to the dollar’s value). The entire process, in which the U.S. unit converted $20,000 into USDT, sent it to the Mexico unit, and then converted it back into dollars, was completed in just 7 minutes, sharply reducing the more than 3 to 4 hours required for conventional inter-bank international transfers. The blockchain platform Avalanche and blockchain payment infrastructure firm Axim participated in this proof-of-concept, and Hyundai Card will launch a second proof-of-concept based on local currencies for Hyundai Motor’s units in Europe, together with Circle and Visa, at the end of this month. In the industry, there are voices saying that the introduction of a Basic Digital Asset Act should be hastened, as won-based stablecoins could lose their footing if major companies’ use of dollar stablecoins expands rapidly.<\/p>\n

6. ‘Volkswagen Law’ That Built Germany’s National Car Now Hampers Restructuring of 100,000<\/a><\/p>\n

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– Key Summary: German automaker Volkswagen held a supervisory board meeting and formalized a plan to restructure up to 100,000 jobs, equivalent to one-sixth of its global workforce. Alongside this, it will also discuss closing four plants in Germany\u2014Hanover, Emden, Zwickau, and Neckarsulm\u2014and reducing the number of vehicle models from the current 150 to fewer than 100. However, with worker representatives holding 10 of the 20 supervisory board seats, and with the “Volkswagen Law” enacted during the 1960 privatization requiring more than two-thirds board approval for agenda items related to production facilities, the restructuring drive is expected to face considerable difficulties. In the first quarter of this year, Volkswagen’s revenue and operating profit fell 6.3% and 34.8%, respectively, from a year earlier, and in Europe, sales of five Chinese automakers such as BYD and SAIC surged 65% year-on-year in May to a 12% market share, surpassing Japanese automakers (11%) for the first time, intensifying competitive pressure.<\/p>\n

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