proper usage of "used to" when designating a change in name

I'm currently entrenched in a grammar dispute with one of my coworkers. We are trying to determine which usage of "used to" properly describes the change we made in a naming convention used at work.

For example:

"Knickers are what we used to call pants"

or

"Pants are what we used to call knickers"

Which sentence properly states that knickers was the name previously used and that pants is the name currently in use?

Solution 1:

If they were called knickers in the past but are now called pants, then your second option is correct.

Let's swap in a synonymous—albeit awkward–phrase for used to to see:

Knickers are what we did in the past call pants.

Pants are what we did in the past call knickers.

I think you can see what's what more clearly now.