Most users disappear during MySQL Upgrade 5.6.44 → 5.7.27

I'm trying to upgrade from

+-------------------------+------------------------------+
| Variable_name           | Value                        |
+-------------------------+------------------------------+
| innodb_version          | 5.6.44                       |
| protocol_version        | 10                           |
| slave_type_conversions  |                              |
| version                 | 5.6.44-log                   |
| version_comment         | MySQL Community Server (GPL) |
| version_compile_machine | x86_64                       |
| version_compile_os      | Linux                        |
+-------------------------+------------------------------+

to

+-------------------------+------------------------------+
| Variable_name           | Value                        |
+-------------------------+------------------------------+
| innodb_version          | 5.7.27                       |
| protocol_version        | 10                           |
| slave_type_conversions  |                              |
| tls_version             | TLSv1,TLSv1.1                |
| version                 | 5.7.27-log                   |
| version_comment         | MySQL Community Server (GPL) |
| version_compile_machine | x86_64                       |
| version_compile_os      | Linux                        |
+-------------------------+------------------------------+

in place.

mysql_upgrade does not report any problems and runs without problems. The data in my databases and tables is ok after upgrading.

The problem is that user accounts disappear. The 5.6 system has 35 users and after conversion there are 6 users of which only one (root) exists in the 5.6 system. The other 5 users are new:

+---------------+------------------------+
| user          | host                   |
+---------------+------------------------+
| root          | 127.0.0.1              |
| root          | ::1                    |
| root          | xxxx.xxxx.xxx          |
| mysql.session | localhost              |
| mysql.sys     | localhost              |
| root          | localhost              |
+---------------+------------------------+

I thought that the reason might be a problem with changes in allowed authentication but the old users (5.6) all have plugin = mysql_native_password which should be ok?

Any ideas whats going on?