ah, an ages old question that has been raised 482 times to date.
A search might be in order. But since you registered to the forums less than 24 hours ago, I'll do it for you this once. [Welcome to GTP btw 👍] Here's a couple threads I found searching 'automatic manual' in the GT4 Drifting forum:
Manual and Automatic. When my hand was broken I couldn't gear up nor down, so drifted with a automatic gearbox. Doesn't matter really, it's not like an automatic gear box just gears when reaching the red area. It's the same as a manual, only GT4 is gearing for you. So all the people that are saying manual, try out automatic, it's the same actually.. I still prefer manual, since that is more fun and realistic
Edit:
And, if you are entering a corner in gear 3, and want to go to gear 2, steer and go peddle to the metal, it'll switch to gear 2 just fine.