Per Apple: Your AirTag sends out a secure Bluetooth signal that can be detected by nearby devices in the Find My network. These devices send the location of your AirTag to iCloud — then you can go to the Find My app and see it on a map. The whole process is anonymous and encrypted to protect your privacy. And itʼs efficient, so thereʼs no need to worry about battery life or data usage.
The range of Bluetooth is typically about ten meters, more or less, though AirTag range is not documented AFAIK.
This means that the periodic “here I am” messages emitted from an AirTag must reach a nearby Apple device, and relayed from there to Apple and the Find My network. No relay, no location.