User blog comment:Rannulf Fritzwilliam/An Intro To Ship Customization/@comment-4791942-20111213233320/@comment-5582269-20111214004833

You upgrade from basic store bought version to rank 1 of streamline, cargo or reinforced hulls. Then once you have all the materials need and gold you can upgrade to rank 2 or downgrade to another hull type. Then you can upgrade to rank 3 after your at rank 2. After rank 3 is the rank 4 special broadside hulls.