Newb question: Why when I upgrade a ship design does it start me at an unmodified hull?

I'm confused by the Upgrade button. I would assume that it would give me the exact ship that I had selected when I clicked Upgrade. Instead, I seem to always get the unmodified base model without any additions. After I've spent a bunch of time tweaking a ship design I would prefer to not re-work all of the components but for instance, just upgrade the guns. Is this possible or do I always have to start from scratch? Am I doing something wrong here?
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There is a setting in one of the configuration screens that controls this. Hit "Esc" in-game (or click "options" on the main menu) and select the "interface" tab along the top. Look under "Ship Designer" and uncheck the "Remove functional components..." check box. That should do it.

Cheers,

Alex