Speaking last week with Kikizo, Microsoft's Shane Kim has been asked about the future of the Project Gotham Racing series, now that creator Bizarre have up and left. His response should help out any 360 racing fans who are yet to put 2+2 together:
...you know, we have a great internal racing studio in Turn 10, the creators of Forza Motorsport. And our goal is to roll the studio so that they can do more creative execution within the racing space. So you can imagine a future where they would develop a new version of Project Gotham Racing.
Think by this stage we've all stopped imagining it, and are just assuming it's already happening.
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Shane Kim Interview [Kikizo]