The upgrade system is basic. But it does allow you to improve your suit or weapon in certain ways. As an example if you go for the Seva it has a bulletproof level of 40 in Vanilla with upgrades it reaches 60. And it is a noticable difference. You can also get repair kits to use yourself but they seem rare. I only got 1 so far as a reward. In Jupiter Cardan and Grey both do repairs. For Cardan you need to find him tools again.