Sqrl on 22 September 2007
I could be wrong but I thought car damage was confirmed.
edit:
Gran Turismo 5 Prologue To Feature Car Damage, Improved AI, Better Physics
I don't think the article explicitly states that its confirmed but I haven't read it yet, just searched on google right quick.
edit2: It does say there is a car damage system planned for the game but doesn't mention how in-depth or good it will be. So its a step in the right direction but not confirmation of a thorough system quite yet. To me it seems likely it will be good, since there is no reason to do a half-assed job on it when the fans clearly have made a point to request this feature.
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