confirmed this back in July, but If you needed further confirmation that Gran Turismo PSP is actually in development, we've got you covered. Speaking at TGS, the head of Sony Worldwide Studios Shuhei Yoshida stated that Polyphony Digital is "working on" a Gran Turismo PSP.
Yoshida attributes the long delay to other titles Polyphohy Digital have been working on, namely Gran Turismo 5 Prologue and Gran Turismo 5 for PS3. He was also unable to provide a timeframe for when the game will be released. Yamauchi believes the game won't be out until after Gran Turismo 5 makes its debut, which means PSP owners will have to wait another two years. Sigh.