Japanese tech blog Macotakara is reporting (Google translation) that the iPhone 5 has already entered production, and are being produced without firmware due to iOS 5 not yet being ready.
Although Macotakara’s track record for Apple rumors isn’t the best, the report is unsurprising and actually rather likely. If the widely anticipated early October release of the iPhone 5 is accurate, it only makes sense that Apple would already have begun producing the devices.
Further, considering that iOS 5 may not be finished, it makes sense to proceed with assembling the hardware, and then simply flashing iOS 5 onto the devices as a last step before the units are shipped to Apple and retail stores.