Air France-KLM’s electronic bag tag and baggage tracker will not be available to its customers by end of this year, the airline group’s general manager for Korea said.

“I don’t think we will be able to launch the digital tag technology service in Korea and elsewhere within this year,” Celine Balmelle, head of the Franco-Dutch group’s Korean operation said on Sept. 2 in an interview with The Korea Herald.

It has been widely expected that the Europe’s second-largest carrier will unveil the permanent bag tag and baggage tracking device that allow travelers to track their luggage via their smartphone by the end of 2015 as the airline group has been working on it for years.

“We are currently working on the prototypes which will have to be tested,” Balmelle said.

Recently, the Wall Street Journal reported that Air France-KLM plans to release the so-called eTag and eTrack later this year.

The company already started promoting the gadgets in a video on its YouTube page in April 2014, saying it’s “aiming to go live with the first customer groups at the end of 2014.”

No reasons have been given for the delay, but it is clear that the traditional European carrier is accelerating cost-cutting measures and curbing investment after reporting widening losses.

In February, Air France-KLM said it would reduce planned investments in new aircraft and services by more than $680 million over the next two years in the face of stiff competition.

Air France-KLM said the permanent bag tag will enable passengers to tag their luggage at home before their flight and drop off their bags at a designated station at the airport. Qantas Airways is the only airline that uses the digital tag.

The GPS tracker called the eTrack will allow passengers to track the location of their bags anywhere in the world.

Balmelle added that the exact timeline and countries to introduce the new system first will be decided after analyzing reliability and defining distribution policy.

By Park Han-na (hnpark@heraldcorp.com)