Melbourne Airport will transition to a track and trace baggage system for international flights, with passengers warned to expect disruptions during a $500 million upgrade.

Under the new system, checked bags will be moved around the airport in trackable trays rather than through a series of conveyor belts.

Melbourne Airport chief executive Lorie Argus said the state of the art system, which is used in Toronto and San Francisco, will take about three years to build and cost $500m.

“We will have disruption while we build that,” she told reporters on Friday.

“We have to build that while we still operate the airport at the same time.

“So (it’s) not without challenges but a very exciting project for us.”

Early bag storage rooms will also be a feature of the new system, allowing international passengers to check in at any time before their flight.

The system will directly dispatch the bags closer to a flight taking off.

There were widespread reports of bags missing flights or being lost after the global aviation industry ramped up following the worst of the COVID-19 pandemic.

Ms Argus acknowledged human error was often a factor in airlines losing or misplacing bags but said the incoming system would minimise mistakes at Melbourne Airport.

“With 100,000 passengers a day and roughly one and a half bags per passenger, that’s a lot of baggage through the system,” she said.

“So anything we can do upgrade and enhance the systems … will certainly improve the customer journey, and we’re confident that the mishandled baggage will be reduced dramatically.”

Melbourne Airport has sent teams to Toronto and San Francisco to study the technology in a bid to aid its implementation.

But Ms Argus doesn’t believe the upgraded system will prompt airlines to slash baggage handler and front-facing staff jobs.

“It will make their job easier but I don’t anticipate that it would reduce the need for airlines to still have people handling that baggage,” she said.

– AAP